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Consists of all parties involved, directly or indirectly, in fulfilling a customer request, include not only manufacturers & suppliers, but also transporters, warehouses, retailers & even customers.
Example
Supply chain management involves planning, design,& control of flow of material, information and finance along the supply chain to deliver superior value to the end customer in an effective & efficient manner Keys to effective SCM
Contd..
Objective is to be able to have the right products in the right quantities (at the right place) at the right moment at minimal cost.
Supply Chain Design Resource Acquisition Long Term Planning (1 Year ++)
Production/ Distribution Planning Resource Allocation Medium Term Planning (Qtrly,Monthly)
Tactical
Operational
Efficient supply chain management must result in tangible business improvements. It is characterized by a sharp focus on
Logistics
Science of managing (controlling) the movement and storage of goods (or people) from acquisition to consumption.
Goods: Raw Materials to Final products, and
everything in between.
Movement = Transportation (between locations).
Storage
Logistics Mission
the right product in the right quantity in the right condition to the right place at the right time for the right customer at the right cost
Logistics Functions
The major logistics functions are:
1. 2. 3.
4.
5. 6. 7.
Order processing Inventory management Warehousing Transportation Material handling & storage system Logistical Packaging Information
The major difference between the concept of logistic management and supply chain management is the level of information gathered, processes, analyzed and used for decision making
If we exclude this information part out of
supply chain model then we can see the logistic management part of the business.
Conclusion
Logistics typically refers to activities that occur within the boundaries of a single organization and supply chain refers to networks of companies that work together and coordinate their actions to deliver a product to market. Logistics focuses its attention on activities such as procurement, distribution, maintenance & inventory management. Supply chain management acknowledges all of traditional logistics and also includes activities such as marketing, new product development, finance and customer services.