Supply Chain Management

A supply chain, logistics network, or supply networkpartners and consumers is established ensuring mutual
is a coordinated system of organizations, people,success.
activities, information and resources involved inSupply chain management must address the
moving a product or service in physical or virtualproblems regarding distribution network
manner from supplier to customer. Its managementconfiguration—number and location of
deals with the process of planning, implementing, andsuppliers, production facilities, distribution centers,
controlling its operations with the purpose ofwarehouses and customers; distribution
satisfying customer requirements as efficiently asstrategy—centralized versus decentralized,
possible.direct shipment, cross docking, pull or push strategies,
Supply chain management spans all movement andthird party logistics; information—integration
storage of raw materials, work-in-process inventory,of systems and processes through the supply chain
and finished goods from point-of-origin toto share valuable information, including demand
point-of-consumption. It integrates supply andsignals, forecasts, inventory and transportation; and
demand management within and across companiesinventory management—quantity and
If a supply chain management system is properlylocation of inventory including raw materials,
implemented, strategic and competitive areas can bework-in-process and finished goods.
used to their full advantage. Fulfillment is enabledSupply chain management is a cross-functional
through efficient communication, ensuring that ordersapproach to managing the movement of raw
are placed with the appropriate amount of timematerials into an organization and the movement of
available to be filled. The supply chain managementfinished goods out of the organization toward the
system also allows a company to constantly seeend-consumer. Its success relies on the
what is on stock and making sure that the rightcorporations’ focus on core competencies
quantities are ordered to replace stock.and being flexible. In some circumstances, operations
Logistics is enhanced, keeping the cost ofshould be outsourced to other corporations that can
transporting materials as low as possible consistentperform the activities better or more cost
with safe and reliable delivery. Production can runeffectively.
smoothly as a result of fulfillment and logistics beingIn effect, the number of companies involved in
implemented correctly without delays due to orderingsatisfying consumer demand would increase, while
and transportation. The company’sreducing management control of daily logistics
flexibility to respond to unforeseen changes inoperations. Less control and more supply chain
demand and supply is improved.partners would lead to the creation of supply chain
Because of this, a company has the ability tomanagement concepts. The purpose of supply chain
produce goods at lower prices and distribute them tomanagement is to improve trust and collaboration
consumers quicker than companies without supplyamong supply chain partners, thus improving
chain management thus increasing the overall profit.inventory visibility and improving inventory velocity.
And most especially, cooperation among supply chain