Supply Chain Management Concepts

Components of Supply Chain

A supply chain is a network of manufacturers, suppliers, distributors, transporters, storage facilities and retailers that perform functions like procurement and acquisition of material, processing and transformation of the material into intermediate and finished tangible goods, and finally, the physical distribution of the finished goods to intermediate or final customers.

Major Components of Supply Chain

A supply chain may consist of variety of components depending on the business model selected by a firm. A typical supply chain consists of the following components:

  1. Customers: The customer forms the focus of any supply chain. A customer activates the processes in a supply chain by placing an order with the retailer.
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Supply Chain Management Processes

Although there are many views of supply chain management (SCM), at present, many practitioners look upon SCM as the management of key business processes across the network of organizations that form the supply chain. A supply chain is a network of manufacturers, suppliers, distributors, transporters, storage facilities and retailers that perform functions like procurement and acquisition of material, processing and transformation of the material into intermediate and finished tangible goods, and finally, the physical distribution of the finished goods to intermediate or final customers.

According to the definition given by the Global Supply Chain Forum, supply chain management is the integration of key business processes from end-user,to original suppliers that provides products, services, and information that add value for customers and other stakeholders.… Read the rest

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Supply Chain Performance Measurement

The main objective of performance measurement is to provide valuable information which allows firms to improve the fulfillment of customers’ requirements and to meet firm’s strategic goals. It is therefore important to measure how effectively the customers’ requirements are met and how resources are efficiently used to reach a certain level of customer satisfaction. Supply chain performance measurement is used to evaluate the effectiveness and efficiency of organizational structures, processes and resources not only for one firm but also for the entire supply chain. It provides some basis for understanding the whole system, influence the behavior and supply information about the performance of the supply chain participants and stakeholders.… Read the rest

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Case Study: Supply Chain Management of Walmart

The world’s largest retailer Wal-Mart was founded by Sam Walton in the year 1962. He opened his first store in Rogers, Ark. On 31st October 1969, the company was incorporated as Wal-Mart Stores. Key success factor was the guidance of Sam. Presently they are operating in fifteen countries with more than 8,000 stores with 2.1 million employees (2009). Major features of Wal-Mart stores are its store area, cleanliness and its shelves which is filled with varieties of quality items that includes health care products, family apparels, electronic items, automotive products, hardware items, jewelry etc.

Wal-Mart is giving more emphasis for customer needs and tried to reduce cost through the effective usage of supply chain management system.… Read the rest

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Introduction to Supply Chain Management (SCM)

Definitions of  Supply Chain Management

Supply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers (Harland, 1996). Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption (supply chain).

Another definition is provided by the APICS (The Association for Operations Management) Dictionary when it defines Supply Chain Management  as the “design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand, and measuring performance globally.”… Read the rest

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