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DEFINITION
Supply chain is the system by which
organizations source, make and deliver
their products or services according to
market demand.
Supply chain management operations
and decisions are ultimately triggered by
demand signals at the ultimate
consumer level.
Supply chain as defined by experienced
practitioners extends from ‘suppliers to
customers’.
Supply chain objectives may differ
from situation to situation.
Transportation Transportation
Costs Costs
Material Costs Transportation
Manufacturing Costs Inventory Costs Costs
5
The Supply Chain – Another View
Plan
Plan Source
Source Make
Make Deliver
Deliver Buy
Buy
6
SCM
8
SUPPLY CHAIN INCLUDES
MATERIAL FLOWS
INFORMATION FLOWS
FINANCIAL FLOWS
SUPPLY CHAIN DRIVERS
– Demanding customers
– Shrinking product life cycles
– Product offerings
– Growing retailer power in some cases
– Core competency
– Emergence of specialized logistics providers
– Globalization
– Information technology
THE STEPS INVOLVED
Revenue growth
Cost reduction.
Supply Chain
Management
Compression (Planning/Manufacturing/Supply)
Conformance (Forecasts/Plans/Distribution)
Co-operation (Cross -Functional)
Communication (Real Time Data)
SUPPLY CHAIN ELEMENTS
• Supply Chain Design
Strategic • Resource Acquisition
• Long Term Planning (1 Year ++)
• Shipment Scheduling
Operational • Resource Scheduling
• Short Term Planning (Weekly,Daily)
Global supply chain
management
Global supply chains pose challenges regarding both quantity and
value:
•Globalization
Travel times