A supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier A vendor, or a supplier, is a supply chain management term meaning anyone who provides goods or services to a company. A vendor often manufactures inventoriable items, and sells those items to a customer to customer A customer, also called client, buyer, or purchaser, is usually used to refer to a current or potential buyer or user of the products of an individual or organization, called the supplier, seller, or vendor. This is typically through purchasing or renting goods or services. However, in certain contexts, the term customer also includes by extension. Supply chain activities transform natural resources, raw materials A raw material is something that is acted upon or used by or by human labor or industry, for use as a building material to create some product or structure.[citation needed] Often the term is used to denote material that came from nature and is in an unprocessed or minimally processed state. Iron ore, logs, and crude oil, would be examples. A non- and components into a finished product that is delivered to the end customer. In sophisticated supply chain systems, used products may re-enter the supply chain at any point where residual value is recyclable. Supply chains link value chains The value chain, also known as value chain analysis, is a concept from business management that was first described and popularized by Michael Porter in his 1985 best-seller, Competitive Advantage: Creating and Sustaining Superior Performance.[2]
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Overview
The Council of Supply Chain Management Professionals (CSCMP) defines Supply Chain Management as follows: “Supply Chain Management encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In essence, supply chain management integrates supply and demand management within and across companies. Supply Chain Management is an integrating function with primary responsibility for linking major business functions and business processes within and across companies into a cohesive and high-performing business model. It includes all of the logistics management activities noted above, as well as manufacturing operations, and it drives coordination of processes and activities with and across marketing, sales, product design, finance and information technology.”
A typical supply chain begins with ecological and biological regulation of natural resources, followed by the human extraction of raw material, and includes several production links (e.g., component construction, assembly, and merging) before moving on to several layers of storage facilities of ever-decreasing size and ever more remote geographical locations, and finally reaching the consumer.
Many of the exchanges encountered in the supply chain will therefore be between different companies that will seek to maximize their revenue within their sphere of interest, but may have little or no knowledge or interest in the remaining players in the supply chain. More recently, the loosely coupled, self-organizing network of businesses that cooperates to provide product and service offerings has been called the Extended Enterprise An Extended Enterprise is a loosely coupled, self-organizing network of firms that combine their economic output to provide products and services offerings to the market. Firms in the extended enterprise may operate independently, for example, through market mechanisms, or cooperatively through agreements and contracts.[citation needed]
Supply chain modeling
A diagram of a supply chain. The black arrow represents the flow of materials and information and the gray arrow represents the flow of information and backhauls. The elements are (a) the initial supplier, (b) a supplier, (c) a manufacturer, (d) a customer, (e) the final customer.There are a variety of supply chain models, which address both the upstream and downstream sides. However the SCOR model is most common.
The SCOR Supply-Chain Operations Reference model, developed by the Supply Chain Council, measures total supply chain performance. It is a process reference model for supply-chain management, spanning from the supplier's supplier to the customer's customer.[3] It includes delivery and order fulfillment performance, production flexibility, warranty and returns processing costs, inventory and asset turns, and other factors in evaluating the overall effective performance of a supply chain.
The Global Supply Chain Forum (GSCF) introduced another Supply Chain Model. This framework[4] is built on eight key business processes that are both cross-functional and cross-firm in nature. Each process is managed by a cross-functional team, including representatives from logistics, production, purchasing, finance, marketing and research and development. While each process will interface with key customers and suppliers, the customer relationship management and supplier relationship management processes form the critical linkages in the supply chain.
The American Productivity & Quality Center (APQC) Process Classification Framework (PCF) SM is a high-level, industry-neutral enterprise process model that allows organizations to see their business processes from a cross-industry viewpoint. The PCF was developed by APQC and its member companies as an open standard to facilitate improvement through process management and benchmarking, regardless of industry, size, or geography. The PCF organizes operating and management processes into 12 enterprise level categories, including process groups and over 1,000 processes and associated activities.
Supply chain management
A German paper factory A paper mill is a factory devoted to making paper from vegetable fibres such as wood pulp, old rags and other ingredients using a Fourdrinier machine or similar apparatus receives its daily supply of 75 tons of recyclable paper Paper recycling is the process of recovering waste paper and remaking it into new paper products. There are three categories of paper that can be used as feedstocks for making recycled paper: mill broke, pre-consumer waste, and post-consumer waste. Mill broke is paper trimmings and other paper scrap from the manufacture of paper, and is recycled as its raw materialIn the 1980s, the term Supply Chain Management Supply chain management is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers (Harland, 1996). Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of (SCM) was developed[5] to express the need to integrate the key business processes, from end user through original suppliers. Original suppliers being those that provide products, services and information that add value for customers and other stakeholders. The basic idea behind the SCM is that companies and corporations involve themselves in a supply chain by exchanging information regarding market fluctuations and production capabilities.
If all relevant information is accessible to any relevant company, every company in the supply chain has the possibility to and can seek to help optimizing the entire supply chain rather than sub optimize based on a local interest. This will lead to better planned overall production and distribution which can cut costs and give a more attractive final product leading to better sales and better overall results for the companies involved.
Incorporating SCM successfully leads to a new kind of competition on the global market where competition is no longer of the company versus company form but rather takes on a supply chain versus supply chain form.
Many electronics manufacturers of Guangdong Guangdong is a province on the southern coast of People's Republic of China. The province was previously often written with the alternative English name Kwangtung Province. It surpassed Henan and Sichuan to become the most populous province in China in January 2005, registering 79 million permanent residents and 31 million migrants who lived in rely on supply of parts from numerous component shops in Guangzhou Guangzhou (simplified Chinese: 广The primary objective of supply chain management Supply chain management is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers (Harland, 1996). Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of is to fulfill customer demands through the most efficient use of resources, including distribution capacity, inventory Inventory is a list for goods and materials, or those goods and materials themselves, held available in stock by a business. It is also used for a list of the contents of a household and for a list for testamentary purposes of the possessions of someone who has died. In accounting inventory is considered an asset and labor. In theory, a supply chain seeks to match demand with supply and do so with the minimal inventory. Various aspects of optimizing the supply chain include liaising with suppliers to eliminate bottlenecks; sourcing strategically to strike a balance between lowest material cost and transportation, implementing JIT (Just In Time) techniques to optimize manufacturing flow; maintaining the right mix and location of factories and warehouses to serve customer markets, and using location/allocation, vehicle routing analysis, dynamic programming In mathematics and computer science, dynamic programming is a method of solving complex problems by breaking them down into simpler steps. It is applicable to problems that exhibit the properties of overlapping subproblems which are only slightly smaller and optimal substructure . When applicable, the method takes much less time than naive methods and, of course, traditional logistics Logistics is the management of the flow of goods, information and other resources between the point of origin and the point of consumption in order to meet the requirements of consumers . Logistics involves the integration of information, transportation, inventory, warehousing, material handling, and packaging, and occasionally security. Logistics optimization to maximize the efficiency of the distribution side.
There is often confusion over the terms supply chain and logistics. It is now generally accepted that the term Logistics applies to activities within one company/organization involving distribution of product whereas the term supply chain also encompasses manufacturing and procurement and therefore has a much broader focus as it involves multiple enterprises, including suppliers, manufacturers and retailers, working together to meet a customer need for a product or service.[citation needed]
Starting in the 1990s several companies chose to outsource the logistics aspect of supply chain management by partnering with a 3PL, Third-party logistics provider A third-party logistics provider is a firm that provides outsourced or "third party" logistics services to companies for part, or sometimes all of their supply chain management function. Third party logistics providers typically specialize in integrated operation, warehousing and transportation services that can be scaled and customized. Companies also outsource production to contract manufacturers.[6]
There are actually four common Supply Chain Models. Besides the two mentioned above, there are the American Productivity & Quality Center's (APQC) Process Classification Framework and the Supply Chain Best Practices Framework.
An unusual food supply chain operated by illiterate Dabbawalas in Mumbai Mumbai (Marathi: मुंबई, Mumbaī, IPA: [ˈmʊm.bəi] ), formerly called Bombay, is the capital of the Indian state of Maharashtra. It is the most populous city in India, and the second most populous city in the world, with a population of approximately 14 million. Along with the neighbouring urban areas, including the cities of Navi is noted for being extremely reliable without using any computers or modern technology. It has been verified to be a six sigma Six Sigma is a business management strategy originally developed by Motorola, USA in 1981. As of 2010[update], it enjoys widespread application in many sectors of industry, although its application is not without controversy supply chain, meaning they make less than 1 mistake in 3.4 million deliveries.[7]
Standardization
Nomeclature, classification and codification
| This section requires expansion. |
See also
- American Production and Inventory Control Society APICS The Association for Operations Management, is a not-for-profit international education organization, offering certification programs, training tools and networking opportunities to increase workplace performance. It was founded in 1957 as the American Production and Inventory Control Society, and currently has more than 43,000 individual and
- Cold chain A cold chain is a temperature-controlled supply chain. An unbroken cold chain is an uninterrupted series of storage and distribution activities which maintain a given temperature range. It is used help extend and ensure the shelf life of products such as fresh agricultural produce, processed foods, photographic film, chemicals and pharmaceutical
- Council of Supply Chain Management Professionals
- C-VARWIP
- Demand chain Analysing the firm's activities as a linked chain is tried and tested way of revealing value creation opportunities. The business economist Michael Porter of Harvard Business School pioneered this value chain approach: "the value chain disaggregates the firm into its strategically relevant activities in order to understand the costs and
- Demand chain management Demand chain management is the management of upstream and downstream relationships between suppliers and customers to deliver the best value to the customer at the least cost to the demand chain as a whole. The term demand chain management is used to denote the concept commonly referred to as supply chain management, however with special regard to
- Demand optimization
- Distribution Physical distribution is one of the four elements of the marketing mix. An organization or set of organizations (go-betweens) involved in the process of making a product or service available for use or consumption by a consumer or business user
- Distribution resource planning Distribution Resource Planning is a method used in business administration for planning orders within a supply chain. DRP enables the user to set certain inventory control parameters (like a safety stock) and calculate the time-phased inventory requirements
- Factory Physics Factory Physics is a book written by Wallace Hopp and Mark Spearman, which introduces a framework for manufacturing management. According to the book's preface, Factory Physics is "a systematic description of the underlying behavior of manufacturing systems. Understanding it enables managers and engineers to work with the natural tendencies
- Extended Enterprise An Extended Enterprise is a loosely coupled, self-organizing network of firms that combine their economic output to provide products and services offerings to the market. Firms in the extended enterprise may operate independently, for example, through market mechanisms, or cooperatively through agreements and contracts
- Industrial engineering Industrial Engineering is a branch of engineering dealing with optimizing complex processes or systems. It is concerned with the development, improvement, implementation and evaluation of integrated systems of people, money, knowledge, information, equipment, energy, materials and/or processes. It also deals with designing new product prototypes
- Inventory control Categories: Supply chain management | Inventory | Distribution, retailing, and wholesaling | Commercial item transport and distribution | Production and manufacturing | Manufacturing | Marketing | Industry | Operations research | National accounts | Lean concepts | Supply chain management terms
- Liquid logistics Liquid Logistics is a special category of logistics that relates to liquid products, and is used extensively in the "Supply Chain for Liquids" discipline
- Logistics Logistics is the management of the flow of goods, information and other resources between the point of origin and the point of consumption in order to meet the requirements of consumers . Logistics involves the integration of information, transportation, inventory, warehousing, material handling, and packaging, and occasionally security. Logistics
- Military supply chain management Military supply chain management is a cross-functional approach to procuring, producing and delivering products and services. The broad management scope includes sub-suppliers, suppliers, internal information and funds flow
- Nomenclature Nomenclature is a term that applies to either a list of names and/or terms, or to the system of principles, procedures and terms related to naming - which is the assigning of a word or phrase to a particular object or property.[clarification needed] The principles of naming vary from the relatively informal conventions of everyday speech to the
- Reverse logistics Reverse logistics stands for all operations related to the reuse of products and materials. It is "the process of planning, implementing, and controlling the efficient, cost effective flow of raw materials, in-process inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of
- Supply network A supply network is a pattern of temporal and spatial processes carried out at facility nodes and over distribution links, which adds value for customers through the manufacturing and delivery of products. It comprises the general state of business affairs in which all kinds of material are transformed and moved between various value-add points to
- Supply chain management Supply chain management is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers (Harland, 1996). Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of
- Supply chain network Due to the rapid advancement of technology such as pervasive or ubiquitous wireless and internet networks, connective product marking technologies like RFID and emerging standards for the use of these defining specific locations using Global Location Number, the basic supply chain is rapidly evolving into what is known as a Supply Chain Network
- Supply-Chain Operations Reference Model
- Supply chain optimization
- Supply Chain Risk Management Supply Chain Risk Management is a discipline of Risk Management which attempts to identify potential disruptions to continued manufacturing production and thereby commercial financial exposure.
- Supply chain security Supply chain security refers to efforts to enhance the security of the supply chain: the transport and logistics system for the world's cargo. It combines traditional practices of supply chain management with the security requirements of the system, which are driven by threats such as terrorism, piracy, and theft. Typical supply chain security
- Value chain The value chain, also known as value chain analysis, is a concept from business management that was first described and popularized by Michael Porter in his 1985 best-seller, Competitive Advantage: Creating and Sustaining Superior Performance
- Value network A value network is a business analysis perspective that describes social and technical resources within and between businesses. The nodes in a value network represent people . The nodes are connected by interactions that represent tangible and intangible deliverables. These deliverables take the form of knowledge or other intangibles and/or
- Vertical integration In microeconomics and management, the term vertical integration describes a style of management control. Vertically integrated companies in a supply chain are united through a common owner. Usually each member of the supply chain produces a different product or service, and the products combine to satisfy a common need. It is contrasted with
References
- ^ Chen, I. J., Paulraj, A. (2004): Towards a theory of supply chain management: the constructs and measurements. In: Journal of Operations Management, 22/2: 119-150
- ^ Anna Nagurney: Supply Chain Network Economics: Dynamics of Prices, Flows, and Profits, Edward Elgar Publishing, 2006, ISBN 1-84542-916-8
- ^ SCC Supply Chain Council, SCOR Model
- ^ the Supply Chain Management Institute - framework
- ^ Oliver, R.K., Webber, M.D., 1982, “Supply-chain management: logistics catches up with strategy”, Outlook, Booz, Allen and Hamilton Inc. Reprinted 1992, in Logistics: The Strategic Issues, ed. M Christopher, Chapman Hall, London, pp. 63-75.
- ^ Selecting a Third Party Logisitcs (3PL) Provider Martin Marray, about.com
- ^ [1]
External links
| Wikimedia Commons has media related to: Supply chain |
Categories: Commercial item transport and distribution This category comprises the transport and distribution of cargo, goods, and other items of commerce. Although many of the articles within this category also deal with transporting people, passenger transportation is outside the scope of this category | Distribution, retailing, and wholesaling Categories: Marketing | Supply chain management | Economics of service industries | Supply chain management Categories: Management | Production and manufacturing | Production and manufacturing See either manufacturing or production for an overview of this topic, and also Enterprise resource planning for computer management of it | Management Categories: Business | Business economics | Applied sciences | Accountability | Supply chain management terms Categories: Supply chain management | Commercial item transport and distribution
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Q. Masters in supply chain management/Pg diploma in supply chain management? Any good institutes offering fast track in one year? What is the scope of the course? Masters in supply chain management/Pg diploma in supply chain management in India in distance mode? Any good institutes offering fast track in one year? What is the scope of the course?
Asked by Vithra Vaishnav in the making - Sun Sep 6 10:14:56 2009 - - 1 Answers - 0 Comments
A. Do not get trapped into semantics. Years ago, an organization named "National Institute of Purchasing management" (NAPM) changed its identity to "The institute of Supply Management". They deal with most of the problems related to purchasing. At the Federal Government Level, "purchasing" has become an obsolete term, replaced by "acquisition" and "procurement" . While some scoff at the ability of government to accomplish things, often overlooked is the fact that, for the most part, what is not recognized is the fact that the big G buys almost everything and is a huge customer. Hence the have to maintain "the best" methods of supply chain management. There are many courses conducted by Federal Agencies in coordination with Universities and… [cont.]
Answered by Cary C - Sun Sep 6 10:36:54 2009
