How Supply Chain Management Is Important For The Survival

1200 Words5 Pages
Supply Chain Management is important for the survival as well as growth of an Industry. SCM helps in eradication of the communication barrier there is and allows the information to flow in an organized way. It also helps reduce the prolixity by coordinating, monitoring & controlling processes. As a Process, SCM covers the point of origin to point of consumption which means that SCM will take care of the production to sales to make sure the demands of the customer are met and the customer is satisfied. To have a successful SCM, coordinated efforts & cooperation between the organization’s business operations is required. When this criterion is met and the organization’s business operations are in sync then the demand of the customer can be met without overstocking which could save a lot of capital for the company. [1] In the above figure, we can see that from acquiring raw materials to delivering the products to a consumer forms a chain. If any one of the aspect is not functioning as it should, then it can effect the whole supply chain itself. If the raw materials do not reach the supplier on time then that would cause a delay in production and distribution which will effect the sales and will effect the customer satisfaction also. To ensure that everything works smoothly, there are certain strategies and framework for SCM that all the organizations follow. The strategies involve collaboration with business partners and also utilization of IT and Web services. [1] Some strategies for SCM are: • Sourcing strategy • Inventory strategy • Warehousing strategy • Transport strategy • Customer satisfaction strategy • Relationship strategy, etc. The strategic decisions play a crucial role for the organization. I have emphasized on some of ... ... middle of paper ... are related to an organization’s need to acquire the required goods and services for manufacturing a product, transforming inputs to outputs or indirectly operating the organization. These processes include activities like product and service sourcing, pricing and term negotiation, supplier selection, transaction and contract management. Strategic Sourcing: Strategic sourcing examines the whole supply network, its linkages and how they affect procurement and purchasing decisions. Production Scheduling: Production scheduling is nothing but a timetable for the utilization of resources and processes needed by a business to produce goods or services. Organizations modify their schedule according to the demands in the current market so that an organization can use its resources efficiently, to reduce cost and also to increase the overall production efficiency. [5]
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