SUPPLY CHAIN MANAGEMENT

A supply chain is a network of interconnected organizations involved in the ultimate provision of product and services required by customers and end users A supply chain exists for the purpose of replenishment, production, and order fulfillment.

Components of SCM

A typical supply chain is very complex and involves a variety of stages (see the linear supply chain): Upstream suppliers, Enterprises internal functions and processes, and Downstream customers

LINEAR SUPPLY CHAIN

A system concept !

Value

Customer/Stakeholder Satisfaction

Value

Suppliers

Enterprise
System-Wide Quality and Operational Efficiency

Customers

Value

Value

Thus emphases is on two areas1.

Value added activities are critical to achieving system-wide quality and operational efficiency The ultimate aim of a supply chain is customer satisfaction. How to measure
these?

2.

In real life, these emphases become more complex! Reasons:--

In more realistic cases, a linear supply chain will continue to grow and expand to customers customers and suppliers suppliers, and become a complex network.
Support Processes Design and Redesign Marketing

Suppliers of Materials and Equipment

Production

Customer Stakeholder Satisfaction

Distribution

Customers

Suppliers Suppliers

Supply Chain Network

Thus Essential Focuses of SCM are

Supply Chain Management (SCM) is a holistic and a strategic approach to demand, operations, procurement, and logistics process management. Specifically, it involves planning supply and demand, sourcing raw materials and components, making products and parts, tracking inventory and order fulfillment, and delivery to the customer and end user.

ERP & SCM

In other word, it involves activities such as:

SC Strategy and Channel Design SC Flow Path Design and Optimization Physical Network Configuration Transaction Processing Planning and Scheduling with ERP and Other Mission Critical Systems

How do we then manage them systematically?