SUPPL Y- CH AIN

MAN AG EM EN T
by Group 5
 01. DEFINITION

CONTENT The importance of supply chains

02. FUNCTIONS
Why does information in the supply
chain flow in both directions?
03. MAIN PURPOSE/ GOALS
Why do decisions about the supply
chain have such a big impact on
how successful companies are?
04. DECISION MAKING PHASES OF SCM
05. MAKING DECISION ABOUT SUPPLY
CHAIN STRATEGY
 Retail

Distribution

01 DEFINITION Customers

MANUFACTURER
Raw Material

Supplier
01 DEFINITION Distribution
Retail

A supply chain is an entire system of

producing and delivering a product or Customers
service, from the very beginning stage
of sourcing the raw materials to the
final delivery of the product or service MANUFACTURER
Raw Material
to end-users.

Supplier
 SUPPLY CHAIN MANAGEMENT
is the handling of the entire production flow of goods or services—
starting from the raw components to delivering the final product to
consumers.

Suppliers Manufacturers Distributors Customers

WHY IS SCM IMPORTANT?
01 Identifying potential problems:
SCM helps us to anticipate issues such as
shortages before they occur, allowing proactive
solutions to be implemented

02 Enhanced Efficiency:
By streamlining processes and minimizing
waste, SCM helps organizations operate more
efficiently and ensures timely delivery of
products or services to customers.
03 Improved Customer Satisfaction:
A well-managed supply chain enables
companies to respond quickly to
customer demands, providing the right
products, in the right quantity, at the
right time, and at the right place.
II. Functions of
a supply chain
07 functions
1. Order fulfillment Process of accepting
orders from customers

Ensuring orders are processed

accurately and delivered to the
customers
Order fulfillment process

1 2 3 4 5

Receiving Storing Order Item Delivery of

Inventory Processing Packing Products
Receive the Organization is key Receiving through Picking items for each Shipping labels are
inventory from as it plays a vital role various channels, order. affixed to package
suppliers. in speed and confirming the Items are packed with Arranging for delivery
efficiency. details and then the appropriate materials Ensuring orders reach
orders are processed for safe shipping. the customers in a
timely manner.
2. New product
development

Refers to the process in a company where

new products are conceptualized, designed,
tested, and brought to market.

New product development is a crucial part of

ensuring the competitiveness and growth of
a business.
 1. Market segmentation

2. Branding

3. Marketing 3. Advertising

includes a range of activities

aimed at promoting products and 4. Pricing strategies
services to target customers.

5. Promotional campaigns

6. Customers feedback
1 of the key functions Contribute to the overall flow
of materials, products, and
information
5. Distribution 01 Getting finished products from where
they're made to where they need to go

02 Products move smoothly and efficiently

through the supply chain to reach
customers.
 6. Finance
( about managing the financial aspects of the supply chain )

Cost Financial
Budgeting analysis
management

2 3 4 5 6
1

Pricing
Forecasting Risk management
strategies
7. Customer services
Focus on delivering a Essential for building
positive customer customer loyalty and
experience throughout the satisfaction.
buying process
Each stage is connected
through the flow of materials,
the products, information and
funds.
These flows often occur in
both directions.
 Helps different parties work together
efficiently, improve processes, and provide
better customer service.
For e.g: You're planning a birthday party and
need to order a cake from a bakery:

Information flow

product flow product flow

III. What is the main purpose of
supply chain?
To maximize the overall value created by the chain by satisfying
customer requirements through efficient utilization of resources,
including distribution capabilities, inventory management, labor, and
storage, simultaneously keeping the cost of the supply chain at a
minimum.
What are the goals of supply chain?
1st 2nd 3rd 4th 5th

Achieve Drive Enhance Build Facilitate

Efficient Customer Organizational Network Financial
Fulfillment Value Responsiveness Resiliency Success
Reduction of Based on clearly To increase the intensity To encounter To drive
supply chain understood of competition from new sudden and competitive
expenses customer market entrants severe supply advantage and
requirements chain disruptions shareholder value
Why do decisions about the
supply chain have such a big
impact on how successfull
companies are?
Here are seven impact on the
success of companies
 See what are impacts

Customer Cost Efficiency Competitive

Sastisfaction Advantage
To cost reductions through
Companies with agile and
optimized processes, reduced
responsive supply chains can
inventory levels, and streamlined
better meet customer needs,
operations, ultimately improving
outperform competitors, and
profitability.
capture market share.
 Find the successful influence
Operational Efficiency Risk Managament
By optimizing resource utilization, Proactive risk management strategies, such
reducing lead times, and improving as diversifying suppliers, building
process flow, companies can achieve redundancy, and implementing contingency
operational excellence and maximize plans, can minimize the impact of disruptions
output with minimal resources and ensure business continuity.
Innovation and
Collaboration
Collaboration with supply chain partners and
leveraging technological advancements can drive
innovation in product development, process
improvement, and customer service.

Sustainability
Supply chain decisions influence environmental and
social sustainability aspects. Companies that prioritize
sustainability in their supply chain operations can
enhance their reputation, meet regulatory
requirements, and appeal to environmentally and
socially conscious consumers.
 Effective supply chain management
Figure out how SCM can drive overall business success
decisions affect and long-term growth.

successfully In conclusion, decisions about the supply chain are critical

because they impact various aspects of a company's
performance, including customer satisfaction, cost efficiency,
competitive advantage, risk management, innovation,
operational efficiency, and sustainability
 IV. DECISION MAKING PHASE OF SUPPLY CHAIN
MANAGEMENT

Supply Chain Supply Chain Supply Chain

Strategy Planning Operations
1. Supply Chain Strategy

Definition: Defines the long-term direction and

scope of the supply chain network to gain a
competitive edge and support overall business
goals

Objectives: Aligns supply chain strategy with

overall business strategy to drive growth,
efficiency, cost reduction, risk management,
and customer satisfaction
Key Elements: Technology Integration: Uses
technology solutions like ERP
systems and SCM software to
improve visibility and decision-
making.

Network Design: Determines how the supply

chain network is structured, including
facilities, distribution channels, and
partnerships.
Customer Segmentation: Identifies and prioritizes customer
groups based on their needs, preferences, and profitability.
2. Supply Chain Planning:

Definition: Involves forecasting, resource

allocation, and decision-making to optimize
the flow of goods, information, and finances
across the network.

Objectives: Improves forecast accuracy,

optimizes inventory management, reduces
lead times, and enhances overall supply chain
efficiency and responsiveness.
Key Elements: Production Planning: Schedules
production to efficiently meet
customer demand while managing
capacity and resources.

Demand Planning: Forecasts future demand

using historical data, market trends, and other
factors.
Key Elements: Logistics Planning: Plans
transportation routes, modes, and
distribution networks to ensure
timely product delivery.

Inventory Planning: Determines the right

inventory levels and replenishment strategies
to balance supply and demand while
minimizing costs.
3. Supply Chain Operations:

Definition: involve the daily tasks and

processes within the supply chain, such as
purchasing materials, manufacturing products,
managing inventory, and delivering goods to
customers.

Objectives: Ensure smooth and effective

execution of supply chain processes, resulting
in on-time delivery of products to customers
and maintaining high standards of service.
Key Elements: Resource Allocation: Raw materials,
labor, and machinery, are allocated
optimally to meet the requirements
of each order.

Order Processing: Incoming customer orders

are processed promptly and accurately,
initiating the fulfillment process.
Key Elements:

Order Fulfillment: Orders are scheduled for fulfillment based

on priority and delivery deadlines, ensuring timely shipment
to customers.
V. Making decisions
about supply chain
strategy
 Cost Reduction: Streamlining
operations, optimizing inventory levels,
and negotiating better deals with
suppliers can all help people save

01 money.

Improved Customer Service: Faster

WHAT ARE THE GOALS? delivery times, accurate orders, and
responsiveness to changes can give a
competitive edge.

Increased Agility: Being able to adapt to

disruptions, changing customer
demands, and new technologies is
crucial in today's dynamic business
environment.
 Map the supply chain, identifying all
stages from raw materials to finished

02
product delivery.

Evaluate the current operations'

strengths, weaknesses, opportunities,
ANALYZING YOUR SUPPLY CHAIN
and threats (SWOT analysis).

Consider factors like lead times,

inventory levels, supplier reliability, and
transportation costs.
Cost Leadership: Prioritizes efficiency
and minimizing expenses.

03
Customer Responsiveness: Focuses on
agility and meeting fluctuating
customer demands.
CONSIDERING DIFFERENT
Risk Mitigation: Aim to minimize
disruptions and ensure supply chain SUPPLY CHAIN STRATEGIES
continuity. Strategies include
diversification of suppliers, safety stock
management, and building
redundancy into the network.
 04
Gather and analyze relevant data on
costs, lead times, customer demand,
and supplier performance.

Utilize data to model different scenarios

DATA-DRIVEN DECISION MAKING
and assess the potential outcomes of
each strategic decision.
 05
Involve key stakeholders across your
organization (e.g., purchasing, logistics,
sales) in decision-making.

Communicate the chosen strategy

COLLABORATION
clearly to all parties, ensuring alignment & COMMUNICATION
and buy-in.
Sugarcane supply chain diagram

Sugarcane
farms
Planting & Care Harvesting Weighing
-
Sugarcane Mill
+ Milling Delivery to Mill Transportation
Juice Processing

Sugar Production
+ Distribution + Packaging + Refiners Retailer
Molasses Production

Consumer