Introduction to Supply chain management (SCM)
Supply chain management (SCM) means to run supply chains in the most effective and efficient methods possible.
Understanding Supply Chain Management
SCM tries to control production, shipment, and distribution of a product. Companies can cut excess costs and produce products to the consumer faster by having tighter control of internal inventories, distribution, sales, internal production and the inventories of company vendors. SCM is based on the belief that each product that comes to market results from the efforts of several organizations that build up a supply chain. Although supply chains have endured for ages, most companies have only recently given attention to them as a value-add to their operations.
Five Elements Of Supply Chain Management
In SCM, the supply chain manager organizes the logistics of all aspects of the supply chain, which includes five parts:
- The plan or the strategy
- The source of raw materials or the services
- Manufacturing which is focused on productivity and efficiency
- Delivery as well as logistics
- The return system for defective and unwanted products
The supply chain manager attempts to minimize shortages and keep costs low. The job is not only about the logistics and acquiring inventory.
Improvements in productivity and efficiency go right to the bottom line of a company and have a real and lasting impact. Good supply chain management keeps companies out of the headlines and away from expensive recalls and lawsuits.
Key Features For Effective And Efficient Supply Chain Management
Connected: Being able to reach the unstructured data from social media, structured data from the Internet of Things and more traditional data sets available by conventional ERP and B2B integration tools.
Collaborative: Improving collaboration with suppliers frequently means the use of cloud-based commerce networks to allow multi-enterprise collaboration and engagement.
Cyber-aware: The supply chain must strengthen its systems and protect them from cyber-intrusions and hacks, an enterprise-wide concern.
Cognitively enabled: The AI platform grows into the modern supply chain's control tower through collating, coordinating and conducting decisions across the chain. Most of the supply chain is automated.
Comprehensive: Analytics capabilities has to be scaled with data in real-time. Insights will be thorough and fast.
