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INTRODUCTION
Supply Chain Management
• From logistics to materials
management to SCM, the evolution
has been slow & steady.
Historical Perspective: -
• Following the World War, production
outstripped demand, resulting in
more marketing or selling problems
than buying problems.
• Also, the World War emphasized the
importance of reaching the right
products at the right time in the right
amount & of the right quality. If the
soldiers could not get whatever they
wanted at the right time, the
consequences could be disastrous.
• These requirements & the criticalities
associated with them made the
defense forces seriously analyze the
supply system.
• The supply system includes the
process of planning, implementing
& controlling the efficient,
effective flow & storage of goods
or services from the organization
from its place of production to the
place where it is required.
• This supply system was referred
to as ‘Logistics Management’.
LOGISITCS MANAGEMENT
• However, the focus was always
more on outbound logistics, i.e.
the flow of finished goods from
the manufacturing unit to the
distributors, to the retailers &
finally to the customers. Inbound
logistics, i.e. flow of basic
materials, components etc. into
the organization was ignored.
• One of the reasons was that
traditionally, purchasing has been
an isolated function in an
organization & hence rarely
attracted the desired attention.
• Hence, inbound logistics never got
the same treatment as outbound
logistics.
• Also, the belief that profits came
from the finished goods market &
that the more finished goods sold.
• CUSTOMER REVOLUTION
• The manufacturer was the king &
pushed his products to the customer.
Quality was a non-issue. Nobody even
talked about it. Customers had to
wait for as long as 8-10yrs to buy a
two wheeler or 4-5yrs for a four-
wheeler.
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Information
Flow
• SCM Network: -
• The level 0 supplier is the basic
materials supplier. They supply to
level 1 supplier.
• The second set of nodes (suppliers’
supplier), represents the second tier
of suppliers. They add value to the
basic materials procured from the
first tier of suppliers & pass them on
to the next node who is the key
suppliers.
• These key suppliers add more
value to the materials procured by
them & supply it to the
manufacturer. He procures the
different types of raw materials,
components & manufactures the
finished product that he is known
for.
• He then supplies (he is also a supplier to the
next set of nodes) the finished product to
the next tier of supplier who is more
popularly known as the distributor.
P re s id e n t a n d C E O
V ic e P re s id e n t V ic e P re s id e n t V ic e P re s id e n t
S a le s a n d M a rk e tin g S u p p ly C h a in F in a n c e
G e n e ra l M a n a g e r G e n e ra l M a n a g e r G e n e ra l M a n a g e r
M a te ria ls L o g is itic s M a n u fa c tu rin g
Implementing Supply Chain
1. Crafting project vision
2. Managing organizational change
3. Choosing the right implementation
approach
4. Managing technical challenges
Managing technical challenges:
• Technology architecture:
• Interfacing multiple systems:
• Data accuracy & integrity:
CONCLUSION