What is Supply Chain Management? Supply Chain Management is the long term plan management of activities that involves acquisition and conversion of finished material products and delivered to customers. It is the system that makes and delivers the products based on market demand. The supply chain includes information flows, material flows, and financial flows. Facilitation of Supply Chain Management: Supply Chain Management is facilitated by:
- Process, and
Functions of Supply Chain Management: Supply Chain Management serves two important functions such as:
- Market Mediation, and
The objective of supply chain system differs from situation to situation. The cost efficiency plays the critical factor for functional products. The important factor for innovative products is responsiveness. The combination of Leanness and Agility develops Leagility. Elements of Supply Chain Management: There are three types of supply chain elements, namely:
i. Supply chain design, ii. Long term planning, and iii. Resource acquisition.
i. Production and Distribution planning, ii. Medium term planning, and iii. Resource allocation.
i. Shipment scheduling, ii. Short term planning, and iii. Resource scheduling. Steps involved in Supply Chain Management: There are several steps involved in Supply Chain Management such as: Step: 1 – Design of supply chain. Step: 2 – Optimization of supply chain. Step: 3 – Planning of material flow. Step: 4 – Short Term Scheduling and transaction process. Goal
of Supply Chain Management: The most effective supply chain management will definitely result in business improvement. Therefore supply chain management is focused on several activities like:
- Effective growth in income,
- Reduction of cost, and
- Best Asset Utilization.
There are several important points to be noted in supply chain management. Some of them are: The customers should be segmented, according to their service needs. Make some partial changes in the supply chain to meet high profits. Modify the logistic network. The product differentiation must be delayed until the last moment. Always have a good relationship with the suppliers. The efficient supply chain system should be done by technology strategy. Overall Supply Chain Management is the best one if it is handled in the right way.