supply chain management is the systemic, strategic coordination of the traditional business functions and tactics across these business functions - both within a particular company and across businesses within the supply chain- all coordinated to improve the long-term performance of the individual companies and the supply chain as a whole.

in a traditional manufacturing environment, supply chain management meant managing movement and storage of raw materials, work-in-progress inventory, and finished goods from point of origin to point of consumption.

it involves managing the network of interconnected smaller business units, networks of channels that take part in producing a merchandise of a service package required by the end users or customers.

with businesses crossing the barriers of local markets and reaching out to a global scenario, scm is now defined as −

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.

scm consists of −

operations management
logistics
procurement
information technology
integrated business operations

objectives of scm

to decrease inventory cost by more accurately predicting demand and scheduling production to match it.
to reduce overall production cost by streamlining production and by improving information flow.
to improve customer satisfaction.

features of scm

scope of scm

scm processes

customer relationship management
customer service management
demand management
customer order fulfillment
manufacturing flow management
procurement management
product development and commercialization
returns management

advantages of scm

scm have multi-dimensional advantages −

to the suppliers −

help in giving clear-cut instruction
online data transfer reduce paper work

inventory economy −

low cost of handling inventory
low cost of stock outage by deciding optimum size of replenishment orders
achieve excellent logistical performance such as just in time

distribution point −

satisfied distributor and whole seller ensure that the right products reach the right place at right time
clear business processes subject to fewer errors
easy accounting of stock and cost of stock

channel management −

reduce total number of transactions required to provide product assortment
organization is logically capable of performing customization requirements

financial management −
- low cost
- realistic analysis
operational performance −

it involves delivery speed and consistency.

external customer −

conformance of product and services to their requirements
competitive prices
quality and reliability
delivery
after sales services

to employees and internal customers −

teamwork and cooperation
efficient structure and system
quality work
delivery

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