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Supply Chain Management (SCM)

Started by arif, April 21, 2017, 12:56:39 PM

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arif

Supply Chain Management (SCM)

Supply Chain Management (SCM) involves managing of goods and services. It includes different stages like storage of goods, logistics and supply of goods to the customer after manufacturing.

It can also be referred as the combination of materials management and product distribution of an enterprise.

Advantages of SCM
Supply chain management increases the flexibility and efficiency for the logistics of a product. The following are the advantages of supply chain management −

#It increases the efficiency to deliver on time by approximately 20 %.

#It reduces inventory requirement by approximately 50 %.

#It increases the sales of product from 3 to 6 %.

#It provides integrated controlling for the function of logistics at the front and back end of business.

Disadvantages of SCM
The following are the disadvantages of supply chain management −

It considers material management important and customer requirement for logistics as superfluous for the supply cycle.

Consequently, customer requirement for logistics is not executed with high importance.

Thus, supply chain management has both advantages and disadvantages and both have to be considered for implementation in an organization.



Source: https://www.tutorialspoint.com/marketing_management/marketing_management_physical_distribution.htm

Monirul Islam

Supply chain management (SCM) is the active management of supply chain activities to maximize customer value and achieve a sustainable competitive advantage. It represents a conscious effort by the supply chain firms to develop and run supply chains in the most effective & efficient ways possible. Supply chain activities cover everything from product development, sourcing, production, and logistics, as well as the information systems needed to coordinate these activities.

The concept of Supply Chain Management (SCM) is based on two core ideas:

The first is that practically every product that reaches an end user represents the cumulative effort of multiple organizations. These organizations are referred to collectively as the supply chain.
The second idea is that while supply chains have existed for a long time, most organizations have only paid attention to what was happening within their "four walls." Few businesses understood, much less managed, the entire chain of activities that ultimately delivered products to the final customer. The result was disjointed and often ineffective supply chains.
The organizations that make up the supply chain are "linked" together through physical flows and information flows.

Physical Flows
Physical flows involve the transformation, movement, and storage of goods and materials. They are the most visible piece of the supply chain. But just as important are information flows.

Information Flows
Information flows allow the various supply chain partners to coordinate their long-term plans, and to control the day-to-day flow of goods and materials up and down the supply chain.

Source: https://scm.ncsu.edu/scm-articles/article/what-is-supply-chain-management-scm