i these flows both within supply chain mgmt Management of Material and informatio degrée of customer satisfaction at ee cere the commitment of Supply chain partners to work neers extended enter etalon, order taking, and order futiiment. They thereby = ~ STIGTPNSE Spreading far beyond the producer's location. Supply chain mana is t ar Sune ‘Sement (SCM) ig the oversight of FeterialsThformation, and in a process from Supplier to may wlaguce to whe from si jolesaler to retailer to consumer. Supply chain managementinvolvesCoordinating and infegrating Rese flows bo vd the lowes Nn flow inva supply chain to provide the highest = = . and among companies. supply chain managements the streamlining of a business’ supply-side activities to a a TESS Supply-side activities to, maximize customer value and to gain a competitive advantage in the marketplace. In commerce, supply chain mana of goods and services,” involves tI igement (SCM), the management of the flow he movement and storage of raw materials, of work- ~ -IProcess inventory, and of finished goods from point of origin to point of consumption Interconnected or interlinked Networks, channels and node businesses combine in the provision of products and services required by end customers in a supply chain RSS ESS ‘eduired by end customers Supply. e 7 in Management has been defined as the "design, planning, &¥écution, ‘control, and monitoring of supply chain activities with the objective of creating Wet value, ~~ building a competitive infrastructure-féveraging worldwide logistics “Synchronizing supply with demand and measuring performance globally." SCM practice draws heavily from the areas of fadustrial enaineering, Systems “engineering, operations management Togistics, yrocurement fSrmation technology, and'Ynarketing © and strives for an integrated approach ‘alea2ee) Marketing channels play an important'ole in supply chain management & + Acustomer-focused definition is given by Hines (2004:p76): "Supply chain strategies require a total systems view of the links in the chain that work fogether efficiently to create customer satisfaction at the end point of delivery {o the consume. consequence, costs must be fowered throughout the chain by driving out ~Wainnecessary expenses¥frovements, afthanding, The main focus isturhed fo ‘efficiency and added value, or the end-users perception of value. Efficiency must be increased, and bottlenecks remaved. The measurement of prformancg focuses. on. (otal system efficiency ang the equitable monelary reward distribution to these wi ee TT ey chain system must be responsive fo customer Tequirements."17) piled Scanned with CamScannerImportance Supply Chain Management, Supply chain Management _operations to maximize both Speeq and ciency. g; eed customers value fast service, Increasi involves 9 supply chain plg A plan for selecting partners, Capacity, location and modes of transportation for the supply chain of Products. Functions _ Supply chain management is a cross-functional aj oach that includes Managing the movement of raw materials info an organization¥€ertain aspects of the internal | processing of material finished goods, and the* lovement of finished goods out of the org: rz ¢ consumer. As organizations strive to focus on core competencies and become more flexible, they réduce their ownership of raw materials ” Sources and diSifibution channels, These fun tions are increasingly bein ther firms that can perform the activities better or more cost effectiveh crease the number of organizations involved in salisfyi “reducing managerial control of daily logistics operations. chain partners lead to the creation of the concept of suppiy chain maheesn on oY ~ purpose. of supply -chain management ist improve Tus ans alabonee es 9 Supely.chain pariners, thus improving inventory visibi movement eee Importance rs Organizations increasingly fing that they must rely on ffective supply chains, or Networks, to compete in the global market and networked economy." In Peter Dasicksi's (7998) new Management paradigm this concept of business relatioriships £xtends beyond traditional enterprise boundaties and seeks to organize entire businesé Processes throughout a value chain of multiple Coinpanies. ee + In recent decades, ‘globalization, outsourcing, and information technology have enabled many organizations, such as Dell and Hewlett Packard, to-successfully operate collaborative supply networks in which each specialized business partner focuses on Scanned with CamScannery / v / only a few Key strategioactivities (Scot, 1993), This M20 } can be acknowledged as a new form of organi this inter. Nnisational su 7 pI -blsactons mons Me lave, eral ss hen Non: Hewes win sept "hierarchy" categories (Powell, 1990) is net gus atket" nor differe ent su ply net V ork structures COUT Nae ea RR of pero SGotdination Conditions and trade-offs that may exist sony te pet systems perspective, a complex network sructure can be docs Component firms (Zhang anid Dilts, 2004). Traditionally, ‘companies in a conicentrate on the inputs and outputs of the processes, with little concer for the fernal management working of other individual players. Therefore, the ghee ofan. ernal management control structure is known to im act | i Se nfrol strycture is k nown £0 fa pact local firm performance Tor \(Minizberg, 1979). SOA AA century, changes in the business environment have contributed to the it of supply chain networks. First, as-an-outcome of globalization and the proliferation of multinational companies, joint ventures, strategic alliances, and business partn ips, significant success factors were identified, conti entinptne center yjust- in-time") lean manufacturing, and,agile manufacturing practices.“\ge ‘technological changes, particularly thédfamatic fall in communication costs (a significant component of transaction costs), have led to changes in coordination among _the members of the supply chain network (Coase, 1998). Many researchers have recognized supply network-structures as a new organisational form, using terms such as "Keiretsu", "Extended Enterprise", "Virtual Corporation", “Global Production Network’, and "Next Generation Manufacturing Syste" 29 In general, such a structure : ine roup of semi-indepenc‘ent ~ saiisng, each with apabiniss, yhisn colabo-ale in ever-changing constellations {o"Serve_oné or more markets inorder to schisve some business goal specific to that Sollaboration" (Akkermans, 2001). Supply chain management is also important for organizational learning. Firms with geographically more extensive supply chairis consecting diverse trading cliques tend to SST Te Ea at SSS acing Cliques tend to become more innovative and productive:! — The-security management system for supply chains is described in ISO/IEC 28000 and ISO/IEC 28001 and related standards published j jointly by the ISO and the IEC. Supply draws-heavilyfrom thé areas.of operations management, logistics, procurement, and information.technology, and strives forarrintegrated approach ——— “w ere ppt Why SCM strategy is important for an Organization ‘Supply Chiain Strategies are the critical backbone to Business Organizations today Effective Market coverage, Availability of Products at jocations that fiald the key to revenue recognition depends upon the effective of Supply Chain Strategy rolled out. Very simply stated, when i iced in tl tand advertised, the and need. to.have-the-product where the customer-can-buy-and:take-delivery. Any Scanned with CamScannerroe te roduct not bein available at the 5; nt time can res Arop in 'Stom rest ata 1 Me can result j tomer in tan Mand which can be disasi rous the id Managemen: "support sales and'iarketing strategy, " assume importance Vinv pean eee ter ga 88 Moc emnin lines on the balance sheet de ee ee ou aa eet: Inventory Means value and is an asset fo thee pany. S a standard forinventory-turnaround that is . Inventory turnaround Tefers to the number of times the 'nventory is sold and-replaced over a peri ‘Period of twelve months, The healt the i i the health of the 'nventory turn relates to the health of business. ‘Da global scenario, the finished goods inventory is held at man: locations and distribution centers, maraped ya eo, a an cto ditriboen tte Pili in transportation . ipeli aneporiation, besa ni, inventory with ~ distributors an etail ‘stocking points. Since any-loss of inventory anywhere in the supply chain would result in loss of value, effective control of inventory and visibility of inventory gains importance as a key factor of Supply Chain Management function. ly Chain Management encompasses, planning, design, Control 1 implementation of all busi SSeS related to‘procurement, e manufacturing, ‘distribution and Sales order fulfillment functions of a business. ——_ All these activities involve multi le networks of Vendors and Service Providers which are integrated and co-c d by the Supply Chain thi ation fo move raw mat tials arid finished goods from: Experts of the organiz and to all distant locations across the globe. information, data and documentation between two entities or points, Logistics plays important role in Post procurement function of delivery of faw material from the supplier to the point of production and Finished Goods Supply chain Management from the point of dispatch from factory to the point of delivery to the customer, The flow of goods flows through a network of transportation by Toad, rail, air or ship and intermediary warehouses to hold inventories before moving to the forward locations. The entire activity involves multi-tier suppliers, Scanned with CamScanneragents, and agencies including frei 5 gen ight forward department, distributors and Logistics series proves am Logistics therefore is an integral com onent of Su i Management. . Pely Chain Origin of Logistics as a recognized discipline is attributed to military and defense organizations. Defense departments make use of detailed and extensive planning to gather supplies and move men and materials to various locations and bases. The success uf any military exercise depends upon the ability of the establishment to be able to gather information, analyze, assimilate and take appropriate logistical measures to support their units continuously. Similarly in any business organization, the successful operations depend upon visibility and control over the logistics process managed through and with excellent logistics service provider backbone and network. Scanned with CamScannereipeline stock (Goods still in transit or in the process of distributi left the factory but not arrived at the customer yet ution - have Safety.stock_J a From Wikipedia, the iree encyclopedia Safety stock (aiso called buffer stock) is a term used by logisticians to describe a level of extra stock that is maintained to mitigate risk of stockouts (shortfall in raw material or packaging) due to uncertainties in supply and demand. Adequate safety stock levels permit business operations tc proceed according to their plans." Safety stock is held when there is uncertainiy in the demand ievel or lead time for the product; it serves as an insurance against stockouts Scanned with CamScanner