Key Takeaways
- Supply chain management (SCM) is the centralized management of the flow of goods and services and includes all processes that transform raw materials into final products.
- By managing the supply chain, companies can cut excess costs and deliver products to the consumer faster and more efficiently.
What are the key processes in supply chain management?
What is Supply Chain Management Process?
- Strategic Planning Process. Strategic Planning Process involves the strategic supply chain design and strategic sourcing. ...
- Demand Planning Process. Demand Planning process involves Forecasting, Lifecycle Planning , Promotion Planning and Consensus Demand Planning.
- Supply Planning Process. ...
- Procurement Process. ...
- Manufacturing Process. ...
- Warehousing Process. ...
What are the steps in supply chain management?
What are the 5 basic steps of supply chain management?
- Planning. Planning is paramount. ...
- Sourcing. Sourcing revolves around the picking process of the suppliers who can produce the goods and services to meet the specific demand.
- Making. ...
- Delivering. ...
- Returning. ...
- Verdict. ...
What are the macro processes of Supply Chain Management?
he supply chain macro processes can be classified into three main processes. They are described briefly below: CRM consists of all those processes that take place at the interface between the concerned firm and its customers. This macro process helps to generate customer demand and helps for p lacing and tracking orders from various customers.
What you can do in supply chain management?
What is a supplier management process flow?
- Qualification. The first stage in the supplier management process is to qualify the supplier. ...
- Onboarding. As a component of the onboarding process, the relevant information about the chosen providers is acquired.
- Classification. The categorisation of suppliers is a crucial step in the supplier life-cycle management process. ...
- Collaboration. ...
- Evaluation. ...
What are the 5 main supply chain processes?
The Top-level of this model has five different processes which are also known as components of Supply Chain Management – Plan, Source, Make, Deliver and Return. Let's deep dive into each component: Plan: Planning is imperative to control inventory and manufacturing processes.
What are the four supply chain processes?
Integration, operations, purchasing and distribution are the four elements of the supply chain that work together to establish a path to competition that is both cost-effective and competitive.
What are the six categories of supply chain processes?
The Six Models of Supply Chain ManagementContinuous flow.Fast chain.Efficient chain.Agile.Custom-configured.Flexible.
What are the 8 supply chain processes?
The Supply Chain Management Process includes the building blocks of Supply Chain Management are Strategic Planning, Demand Planning, Supply Planning, Procurement, Manufacturing, Warehousing, Order Fulfillment and Transportation business processes.
What are the 7 principles of SCM?
Adapt Supply Chain to Customer's Needs. ... Customize Logistics Network. ... Align Demand Planning Across Supply Chain. ... Differentiate Products Close to Customer. ... Outsource Strategically. ... Develop IT that Support Multi-Level Decision Making. ... Adopt Both Service and Financial Metrics.
What are the example of supply chain management processes?
Supply chain management is the practice of coordinating the various activities necessary to produce and deliver goods and services to a business's customers. Examples of supply chain activities can include designing, farming, manufacturing, packaging, or transporting.
What are the 3 types of supply chain?
The 3 Levels of Supply Chain Management: Strategic, tactical and operational. The three levels of supply chain management are strategic, tactical and operational.
What are the two main types of supply chain?
The 2 Types of Supply ChainsReactive Supply Chain StrategyData-Driven Supply Chain StrategyOperational improvements based on guesswork or imitating competitorsA data-driven approach helps even best-in-class manufacturing operations find new ways to improve efficiency[iii]5 more rows
What are the 4 components of supply chain management Mcq?
The major decision areas in supply chain management arelocation, production, distribution, inventory.planning, production, distribution, inventory.location, production, scheduling, inventory.location, production, distribution, marketing.
What are the four characteristics of service supply chain management?
The characteristics of a good supply chain are visibility, optimization, having the lowest cost possible, timeliness, and consistency.
What are the 3 types of supply chain?
The 3 Levels of Supply Chain Management: Strategic, tactical and operational. The three levels of supply chain management are strategic, tactical and operational.
What are types of supply chain?
The three responsive supply chain models are the agile model, the flexible model, and the custom configured model. These models are ideal for “on demand” situations. They are ideal when there is a level of uncertainty in the product manufacturing.
How many levels of supply chain management are there?
The Supply Chain Management strategy of a company can be at three levels:
How many key supply chain processes are there?
The Global Supply Chain Forum has listed eight key supply chain management processes. This supply chain management process is cross-functional and needs to be streamlined and integrated into the value chain.
How to outsource supply chain?
Outsourcing the Supply Chain function: Some of the SMEs outsource their supply chain function mainly by purchasing the Supply Chain Management software and implementing Vendor Managed Inventory or reduced finished goods inventories by obtaining more accurate forecasts. This saves a lot of money, and they can leverage the use of technology. However, it is a double-edged sword. Relying completely on the demand forecasts could spell disaster. Hence a balanced approach should be undertaken.
Why is it important for SMEs to have a supply chain strategy?
This is because SMEs are small in size and many in number; they lack adequate resources in terms of people, finance and technology to implement the best supply chain practices. It has become increasingly important for SMEs to have a supply chain strategy to enable them to be competitive in the marketplace.
What is global supply chain forum?
The Global Supply Chain Forum of Ohio State University is a team of academicians who meet and improve the theories and practices of the supply chain management process.
Why is the supplier important?
Just like the customer, the supplier is a very important part of the supply chain. The company identifies its key suppliers, negotiates and enters into an agreement with them. It tries to forge good relations with its main suppliers resulting in a win-win situation.
Why is it important to have an efficient supply chain?
The purpose of an efficient supply chain system is to minimize lead time and provide the best quality products at the best possible cost by eliminating all possible waste in the value chain.
What is Supply Chain Management?
Supply chain management is used to describe a number of different approaches that are used to integrate the flow of materials, finances and information efficiently. These items are usually outsourced from any number of places. These sources include suppliers, manufacturers, wholesalers, distributors and retailers. Items can pass through several hands until they reach the customer.
What makes supply chain management a challenge?
However difficult that goal might be to achieve, the rewards in customer satisfaction and bottom-line savings are more than enough motivation to seek a cohesive whole, making the journey from raw materials to final goods efficient for the organization and satisfying for the customer.
What is SCM in business?
SCM coordinates and integrates this back and forth, within and outside the organization. Its objective is improving service for the customer but not at the expense of the organization, which is seeking at the same time to reduce its supply chain costs.
How does SCM help a company?
But it’s not just the customer who benefits. As noted, SCM is instrumental in cutting operation costs. When smartly applied it can decrease purchasing, production and total supply change costs. This improves a company’s financial position by adding to profit leverage, reducing fixed assets and increasing cash flow.
How does product development and commercialization help the company?
Product Development and Commercialization: To reduce time to market, customers and suppliers are integrated into product vision and the product development process. Shortening the product life cycle keeps the company competitive. This process includes coordinating with customer relationship management to know customer needs, selecting materials and suppliers with procurement and developing a production technology in the flow of manufacturing to integrate the best supply chain flow for the product and market. When successful, this has a positive impact on cost, quality, delivery and market share.
What is the mission of SCM?
The mission of any SCM methodology is to coordinate all the varied parts into a cohesive whole, from supplying raw materials to delivering final goods or services. The goal is to reduce costs in achieving this objective. The issue is that there are often many conflicts among supply chain partners.
How to get the most out of SCM?
To get the most out of SCM requires looking at the big picture in terms of an organization’s management. No longer is managing an individual company function enough. The integration of all activities involved in the supply chain is necessary: that means integration between different departments, such as purchasing and marketing.
What is supply chain management?
Supply chain management is defined as 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.
What is strategic supply chain?
Strategic Supply Chain Design Process: Strategic Supply Chain Design is the design, evaluation, and optimization of the supply chain model used in the planning applications. Every part of the supply chain such as locations, transportation lanes, resources and products are modeled to execute planning based on this network. This helps to respond immediately and accurately to the new developments by tracking alert situations in the supply network.
What is strategic sourcing?
Strategic Sourcing Process: Strategic Sourcing Process helps to identify a minimized set of core suppliers with whom to establish strategic relationships, and also define the parameters that drive procurement execution. Vendor analysis and purchasing statistics are used to evaluate potential suppliers. Performance management through spend and contract compliance analytics are also done for enabling the strategic sourcing process.
What is purchase order processing?
Purchase Order Processing : Purchase Order Processing fulfills the direct procurement requirements through the sourcing, issuance, and confirmation of purchase orders.
What is life cycle planning?
Lifecycle Planning Process : Life cycle planning involves planning the product life cycle. Lifecycle Planning simulates based on the forecasting data the launch, growth, maturity and discontinuation phases of different products.
What is manufacturing execution?
Manufacturing Execution: Manufacturing Execution process supports the process of capturing actual production information from the shop floor to support production control and costing processes.
What is supply network planning?
Supply Network Planning Process: Supply Network Planning process calculates quantities to be delivered to the locations to match customer demand and maintain desired service level.
What is the supply chain?
Supply chain captures the entire flow that brings a product or service to market
What is supply chain planning?
But, it’s important to remember that the goal here isn’t just to understand your supply chain—it’s to make sure it’s in tip-top shape. You’ll only reap the benefits if your supply chain is optimized.
Why do logistics and supply chain management go hand in hand?
But, that also means that the two terms are often confused—when, in reality, they represent two different things. Here’s the rub on supply chain vs . logistics: Supply chain captures the entire flow that brings a product or service to market.
What is the difference between supply chain and logistics?
Here’s the rub on supply chain vs. logistics: 1 Supply chain captures the entire flow that brings a product or service to market 2 Logistics is a small segment of the supply chain, focused on the movement and transportation of the products
What is the role of Marrisa in the supply chain?
In Marrisa’s supply chain, she would function as both the manufacturer and the distributor, since she’s the one producing the soaps and delivering them to their retail locations.
Why is supply chain analysis important?
Using supply chain analysis empowers you to maintain more ideal amounts of inventory because you understand exactly how long it takes to move from raw materials to a finished product.
What are some examples of supply chain?
Example of supply chain: How raw materials turn into handmade soaps. The very concept of a supply chain strategy can seem daunting. But, once you dip your toe in and gain more familiarity, you’ll realize that things actually move in a pretty sensical order.
