Fierce competition in today?s global markets, the introduction of products with shorter and shorter life cycles, and the heightened expectations of customers have forced business enterprise to invest in, and focus attention on, their supply chains. This, together with continuing advances in communications and transportation technologies (e.g., mobile communication, Internet, and overnight delivery), has motivated the continuous evolution of the supply chain and of the techniques to manage it.
? If a company makes a product from parts purchased from suppliers, and those products are sold to customers, then you have a ?supply chain?. The supply chain, which is also referred as the logistics network, consist of suppliers, manufacturing centers, warehouses, distribution centers, and retail outlets, as well as raw material, work in process inventory, and finished product that flow between the facilities.
As supply chain Management involves procuring the right inputs (raw materials, components and capital equipments); converting them efficiently into finished products and dispatching them to the final destinations; there is a need to study as to how the company's suppliers obtain their inputs. The supply chain perspective can help the retailers identify superior suppliers and distributors and help them improve productivity, which ultimately brings down the customers costs. At the same time, Market logistics helps planning the infrastructure to meet demand, then implementing and controlling the physical flows of material and final goods from point of origin to points of use, to meet customer requirements at a profit.
To ensure that the supply chain is operating as efficient as possible and generating the highest level of customer satisfaction at lowest cost, company have to adopt supply chain management processes and associated technology.
?This presentation provides a conceptual understanding of what a supply chain is, and the various issues while designing, planning, operating a supply chain.
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1.1 Supply chain-
A supply chain consists of all parties involved, directly or indirectly, in fulfilling a customer request. As the supply chain starts and ends with the customer a simple supply chain is made up of several elements that are linked by movement of product along it.
Such elements are-
1.Customer:The customer starts the chain of events when they decide to purchase a product that has been offered for sale by a company. The customer contacts to the retailer.
2.Manufacturers: Manufacturer manufacture the product as per the customer requirement. Company purchase the raw material as per the requirement of the product from the vendors that are placed in local market.
3.Purchase:Components of the product are purchase from market by asking the tenders from venders. And by this process venders are decided.
4.Wholesalers /Distributors: Distributors are fixed by the manufacturer to distribute the product to retailers.
5.Transportation: Transportation is the key factor of the supply chain it transports the material and product from company to distributor to retailer and also brings the marerial to manufacturing unit from suppliers and vendors.
6. Retailers: Retailer is only factor that is connected with directly with customer. That?s why retailers role is much more important in supply chain.
Consider a customer walking into a Big Bazaar store to purchase noodles. The supply chain begins with a customer and his need for noodles. The next stage of the supply chain is the big bazaar retail store that the customer visits. Big Bazaar stocks its shelves using inventory that may have been supplied from finished goods warehouse or a distributor using trucks supplied by third party. The distributor in turn is stocked by manufacturer (say nestle, India). The nestle India plant receives raw material from a variety of suppliers, who may have been supplied by lower tier suppliers. This suppliers receives grains from farmers. Then the company manufacturer decide to make the noodles by customers requirement to satisfy his needs. ?
2. 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. 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 SCM is 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."
More common and accepted definitions of Supply Chain Management are:
A supply chain, as opposed to supply chain management, is a set of organizations directly linked by one or more of the upstream and downstream flows of products, services, finances, and information from a source to a customer. Managing a supply chain is 'supply chain management'.
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2.2 SUPPLY CHAIN MANAGEMENT PROBLEMS
Supply chain management must address the following problems:
Supply chain execution means managing and coordinating the movement of materials, information and funds across the supply chain. The flow is bi-directional.
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