The activities involved with supply chain management are related to good's flow and transformation through various stages. These stages can be the flow of raw material, partial finished goods and parts to be assembled or finished product supplied to end users. Apart from these goods and materials, Supply Chain Management also includes flow of related information and funds for these products.
The Supply Chain Management is also divided in four main stages that are:
1. The supply network
2. The internal supply chain (which are manufacturing plants)
3. Distribution systems
4. The end users
On the basis of flow type, these stages can also be classified as:
1. Material flow
2. Service flow
3. Information flow
4. Funds flow
There are also various links to connect these stages with each other such as the supply network and manufacturing plant which are linked by e-procurement. Similarly manufacturing plant and distribution network are connected by e-distribution and to connect end users with the distribution network, e-commerce is employed.
Supply Chain Management is also regarded as a collection of various activities and decisions. These activities need to be in synchronization for the effective integration of suppliers, manufacturers, warehouses, transporters, retailers and customers. This synchronization is very important for the appropriate distribution of product and services in correct amount at a given time. Supply Chain Management aims at the satisfaction of the customers with the minimization of cost induced in various stages of supply chain. SCM also gives an edge in competition over the other suppliers or providers of the same product or service. In today's E- Business environment, supply chain becomes quite complicated for large organizations as there are a number of suppliers and customers at the same time.
The main focus of supply chain members is to implement the supply chain in a way such that it can compete on the basis of cost, quality, flexibility and availability.
The main cause of the failure of the Supply Chain is the incorrect understanding of the demand of market which leads to wrong design of the supply chain. To design an appropriate supply chain we need to combine both efficient supply chain and responsive supply chain. The responsive supply chain aims at the quick identification of the market demands. Such supply chain models are required in environments where new products come into the market frequently; prediction of demands is low and has high forecast errors. It helps to introduce new products by identifying the demands, changes in market and end user response. With responsive supply chain, the future of a certain product is also decided with which inventory of a certain product to be supplied. On the other hand, efficient supply chain is used in environments where prediction errors are low and new products come after long gaps in the market. It helps in co-ordination of service and material flow so inventory levels can be minimized and quality of service can be achieved.
Supply chain management has become an integral part of every product or service provider. Organizations employ custom application development companies to develop SCM solutions as it helps them to compete with other competitors.
Author Resource:
Author’s bio:
Christa Joe is the author of this article. She has been demonstrating her writing skills by writing the articles for software development in gurgaon companies like Q3 technologies since last two years. She is also used to write good articles for cloud computing platforms .
For more details, feel free to visit http://www.q3tech.com
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