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SCM Basics

Effective supply chain management can help companies reduce total cost, improve quality, reduce time-to-market, increase customer service, better utilize internal, supplier and customer capabilities, and minimize new capital investment. The key to success is the development of human resources, arming people with a new set of skills that enables them to:

  • Make decisions in the face of uncertainty;
  • Adapt quickly to different job requirements;
  • Lead a diverse set of team members;
  • Recognize and deploy new technologies;
  • Create collaborative solutions with customers and suppliers;
  • And continuously learn from others


The SCRC is in the process of gathering and creating self-paced learning materials to help the SCM beginner as well as the seasoned professional develop and update those skills.

 

  
What is Supply Chain Management?

 

In response to intense global competition, organizations now find they must be involved in the management of (or at least take a serious interest in) all upstream firms (suppliers) that provide direct and indirect inputs. They must also be concerned with the network of downstream firms responsible for delivery and after-market service of the product to the end customer. From this realization emerged the concept of the supply chain:

The supply chain encompasses all activities associated with the flow and transformation of goods from the raw materials stage (extraction), through to end users, as well as the associated information flows. Material and information flows both up and down the supply chain. The supply chain includes new product development, systems management, operations and assembly, purchasing, production scheduling, order processing, inventory management, transportation, warehousing, and customer service. Supply chains are essentially a series of linked suppliers and customers; every customer is in turn a supplier to the next downstream organization until a finished product reaches the ultimate end user.

Supply chain management is the integration of these activities through improved supply chain relationships to achieve a sustainable competitive advantage.

The supplier network consists of all organizations that provide inputs, either directly or indirectly, to the focal firm (i.e., the purchaser). The distributive network consists of all downstream organizations that ensure that the right quantity of goods is delivered to the appropriate customer location in a timely manner.