Saturday, September 19, 2015

Chapter 10 : Extending the Organization Supply Chain Management

Basics of Supply Chain :
  • Supply chain => consists of all parties involved, directly or indirectly, in the procurement of a product or raw material.
  • Supply chain management (SCM)  => involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability.
  • The supply chain has three main links :                                                                                           => materials flow from the suppliers and their upstream suppliers at all level.                              => transformation of materials into semi-finished and finished products, or the organization's own production processes.                                                                                                               => distribution of products to customer and their downstream customers at all levels.

  • Visibility - the ability to view all areas up and down the supply chain.
  • Consumer behavior - the behavior of customers has changed the way businesses compete.
  • Competition - 1. supply chain planning (SCP) software => uses advanced mathematical                                        algorithms to improve the flow and efficiency of the supply chain while                                      reducing the inventory.                                                                                                                 2. supply chain execution (SCE) software => automates the different steps and                                stages of the supply chain.
  • Speed - the company's ability to satisfy continually changing customer requirements efficiently, accurately, and quickly. 

Supply Chain Management Success Factors :

  • The following are the keys to SCM success :
  1. make the sale to suppliers.
  2. wean employees off traditional business practices.
  3. ensure the SCM system supports the organizational goals.
  4. deploy in incremental phases and measure and communicate success. 
  5. be future oriented.

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