Supply Chain Management has dominated our lives, our thinking and our actions for almost half a decade now. From logistics to materials management to supply chain management, the evolution has been slow and stead. The decade of the 90's has been the most turbulent leading to large-scale adoption of the concept of supply chain management. Implementing supply chain management is a long drawn process that necessitates restructuring of not only internal organizational activities but also demand relook at the relationships the company shares with its suppliers, distributors and all others who participate in the value creation process. The starting point is a thorough understanding of what a supply chain is all about, the background, the thinking and the various bricks that the supply chain is made of.
Supply chain is understood as a bridge between demand and supply. It conveys the demand to the supply point and delivers the supply to the demand point. It is a network of facilities and distribution options that perform the functions of procurement of materials, transformation of materials into intermediate and finished products to customers.
According to APICS (American Production and Inventory Control Society) Dictionary, supply is understood as the quantity of goods available for use for the actual replenishment of a product. Supply chain management means planning, organizing and controlling of supply chain activities. In a nutshell it means "from the customer to the customer."
[...] It is used for speedy delivery Roll-on roll-off: High cost of lifting a container from the truck and loading on to a ship made supply chain to look for a new idea. Concept of RORO is driving the truck loaded with the container directly on to the deck or a ship and driving off the deck on reaching the destination. Truck loaded with container uses the ship as a mobile bridge; it can be clearly understand by the picture given below, Fig 4.10 Roll-on Roll-Off 5. [...]
[...] The set of partners may change according to a given market, region, or channel, resulting in a proliferation of trading partner environments, each with its own unique characteristics and demands Specialization Era Phase Two Supply Chain Management as a Service: Specialization within the supply chain began in the 1980s with the inception of transportation brokerages, warehouse management, and non asset based carriers and has matured beyond transportation and logistics into aspects of supply planning, collaboration, execution and performance management. Supply chain specialization enables companies to improve their overall competencies in the same way that outsourced manufacturing and distribution has done; it allows them to focus on their core competencies and assemble networks of best in class domain specific partners to contribute to the overall value chain itself thus increasing overall performance and efficiency. [...]
[...] Organizational structure : The organizational structure of a firm and the structure of its supply chain as a whole determine how effectively the firm or supply chain can provide service to the customers. The firm has to evaluate whether appropriate systems are in place to deal with the customer service process. For example if a company specifies that the product will be delivered to the customer within 5 days, the suppliers, the manufacturing department, the warehousing facility and the logistics provider have to collaborate to deliver the product within 5days. [...]
[...] Inventory is spread throughout the supply chain from raw materials and semi- finished goods that suppliers, manufacturers, wholesalers and retailers hold inventory constitutes a significant portion of the assets of any firm. Since inventory costs constitutes a major portion of the cost of a firm, a reduction in inventory levels by even a few percentage points, can lead to a remarkable improvement in the profitability of the firm. Thus inventory management offers substantial opportunities for improving the profitability of firms. [...]
[...] The firm's supply chain strategy can be built around its core competencies like customer service, product quality, technology leadership, product attributes, and process attributes, etc. for example, Wal-Mart's core competency is offering products to customers at a low price. Therefore, its facility network design needs to be in line with the low pricing strategy. For this, Wal-Mart has to set up cost –effective facilities so that costs can be kept minimal and it can offer product to customers at low prices. [...]
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