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Unit_1

1. Q What is meant by supply chain management? Discuss the important objectives of supply chain Management. OR 2. Q Explain briefly the concept of SCM. What are the functions of SCM? Or 3. Q What is meant customer service strategy? Evaluate the process involved in the development of customer service strategy?

Supply Chain Management:


A Supply chain is the process of moving goods from the customer order through the raw materials stage, production and distribution of products to the customer. All organizations have supply chain varying degrees, depending upon the size of the organization and the type of product manufactured. These networks obtain supplies and components, change these materials into finished products and then distribute them to the customer. Managing the chain of events in this process is what is know as supply chain management. Effective management must take into account coordinating all the different pieces of this chain as quickly as possible without losing any of the quality or customer satisfaction, while still keeping cost down.

Other definitions are as follows:


Thomas and Griffin: Management of material and information flows both in and between facilities such as vendors, manufacturing and assembly plants and distribution centers.

Harland: Managing business activities and relationships.


Internally with the organization, With immediate suppliers, With first and second-tier suppliers and customers along the supply chain, and with the entire supply chain.

Christopher: SCM is the management of upstream and downstream


relationship s with the suppliers and customers to deliver superior customer value at lesser cost to chain as a whole.

Stevens: The objective of managing the supply is to synchronize the


requirements of the customer with flow of materials from suppliers in order to affect a balance between what are seen as conflicting goals of high customer service, low inventory management and low unit cost.

Cooper at al: Supply chain management is an integrative philosophy to


manage the total flow of distribution channel from supplier to ultimate user.

Stock & Lambert: Suggest Supply chain management is the management


of eight key business processes: customer relationship management, customer service management, demand management, order fulfillment, manufacturing flow management, procurement, product development and commercialization and returns. These processes subsume or include much of logistics, purchasing, marketing and operations management.

Ellram & Cooper: SCM is an integrative philosophy to manage the flow of


distribution channel from supplier to ultimate user.

According to Mentzer et al. all the traditional between functions should


be included in the process of SCM. In their model of SCM, these traditional business functions are marketing, sales, research and development, forecasting, production, purchasing, logistics, information systems, finance and customer service. The institute for Supply Chain Management (ISM), founded in 1915 n USA, serves about 50,000 member professionals. Its mission is to educate, develop and advance the purchasing and supply management profession.

Why SCM?
Companies across the world are looking forward to value innovation as the strategic logic for high growth. World-class value adding performance outputs are as follows; Quality: the quality of products and services should be virtually defect-free line. In some cases, 10 or fewer defective parts per million (PPM). At many firms, over 50 percent of all quality defects can be traced back to purchased materials. Cost: The Supply Chain Management function must focus on strategic cost management, the process of reducing the total cost of acquiring, moving, holding, converting and supporting products containing purchased materials and services throughout the supply chain. Time: Total cycle time requires the examination of every aspect of the firms operations, meticulously eliminating all redundant of non-value added, but timeconsuming activities from the process. Technology: The Supply Chain Management function has two key responsibilities in the area of technology. It must ensure that the firms supply base provides appropriate technology in a timely manner, and it must ensure that technology which affects the firms core competencies (the thing that gives the firm its unique reason for being) is carefully controlled when dealing with outside suppliers and customers.

Continuity of supply: Monitoring the trends, developing appropriate supplier alliances and taking such other actions as required the risk of supply disruptions.

Objectives and functions of SCM


The objectives of supply chain integration are to supply quality good faster, with efficient processes and in essence be more responsive to the perceptions of the marketplace and be able to change directions at will. Some of the consequences of supply chain integration result in. Reduced inventory at all sites of supply chain. Reduced of costs Faster processing speeds. Reduced lead times. Reduced warehouse costs. Reduced obsolescence. Greater responsiveness to customer changes. Electronic links to suppliers and customers. Continuous flow of products and information. Speeding up the development cycle.

Functions
Supply uncertainty can be addressed through a number of initiatives such as vendor development and certification, sharing of production we identify 15 key thrust areas of SCM which would lead to specific decision areas. Minimizing uncertainty: Supply Uncertainty due to unreliability of vendors, process planning information and joint attention to transport arrangements. Process uncertainty is due to machine breakdowns, uncertain yields and absenteeism, which can be addressed through good maintenance practices, better technology. Etc. Demand uncertainty can be reduced to some extent by forecasting techniques and by better communication with customers. Reducing lead times: Lead time, at the stages of procurement, conversion and distribution can be cut down by faster modes of transport, better planning practices and process technologies. Minimizing the number of stages: In general, the number of stages that goods and servces flow through adds to the complexity of SCM. Unification of tasks and reducing the number of stages make the coordination of decisions

easier. This is the essence of another management concept, namely Business Process Reengineering. Improving flexibility: Reducing set up or change overtimes in various processes and the use of flexible manufacturing assembly techniques improves the flexibility of response. In transport, the use of smaller vehicles provides flexibility in making dispatches at short notice without being constrained by batching economies. As an extended principle, wherever possible, batch process should be made continuous process. Improving process quality: A prerequisite to effective SCM in the light of reducing inventories and wastage is to do things right, the first time. This is deal for improving process quality. The techniques for this include statistical process control, root cause analysis of poor quality and improvement of process capability. Making Variety: Variety is one of the major causes for inventory in the downstream part of supply chains. One response appropriate promotion and branding. This will enable a better control of the supply chain, right from demand generation. Delaying Differentiation: The value addition through product differentiation should be postponed as far as possible, so that precise customer needs can be met wit out holding committed stocks in the entire chain. There are numerous examples of how this can be done, such as shipping of component level goods level goods to examples of how this can be done, such as shipping of component level goods to major points and assembling according to customer needs, postponing, finishing operations the grinding and mixing of additives to cement till near the final point of consumption, etc. Kitting of supplies: In assembly systems, a major source of delay is the staging delay where some components for assembly have to wait since matching components are not available. Vendors or internal facilities that supply components can be arranged so that all components required for an assembly (or major sub assembly) are manufactured or supplied to one stage where they are kitted into sets of matching components, ready for assembly and further operations. This could involve some restructuring of vendors of internal activities and some vertical integration. Focusing on A Category: This is a well-known idea from classical economies and inventory theory where items that account for a large part of the value, or which are critical, and / or customers who significant, and / or territories that are important, receive special attention. Planning for Multiple Supply Chains: Doing better SCM would often require different supply chains for different customer segments based on response requirements. The tendency to club supply chains in the interest of efficiency can be counter product ivy for effectiveness.

Modifying Performance Measures: These need to move from being single actor focused to multi actor focused in the supply chain. For example, in the context of a warehouse, instead of warehouse space utilization as the primary measure of warehouse performance the retrieval time would be more in tune with SCM, since this focuses on both the warehouse and the downstream actor. Similarly, a transporter like the railways would focus more on time taken for delivering a wagon/ rake to a customer from the time the indent is placed, rather than wagon utilization/ turn around. Comparing on service: The big opportunity in SCM for long-term competitive advantage is on the service aspects of value delivery to the customer. Product quality and features can only be short term advantages. Moving from functions to processes: Improving supply chain practices will require integrated process orientation rather than functional organization. Job rotation, flatter and lean organizations will help. Taking Initiatives at an Industry Level: This is very essential, especially in dealing with poor infrastructure. Industry level (rather than firm level) initiatives in specific product categories can focus on say transport and / or warehousing inadequacies and help to develop opportunity for third party logistics services here. 4. Q what do you understand by logistics management? Examine the relationship between logistics Management and SCM?

Introduction
Logistics is one of the most important segments of the phenomenon of marketing in business. It is a subset of SCM. In the business functioning, the trader gets the order for supply of his good or services through marketing executives or directly from customers and then to execute the order to the satisfaction of the customer, the trader or his supplier company prepares the logistics i.e., procures the product or services, puts labels on them, or gives some identification trademarks name to them, makes necessary packing and packing so as to save them from damage of any kind during loading, unloading, handling, transportation etc., Till is supplied to the end customer. More simply, it is bundle of goods finally supplied to the customer. Logistics management includes the design and administration of system to control the flow of material, work-in-process, and finished inventory to support business unit strategy.

The concept of logistics


Logistics

Logistics is the part of the supply same process that plans, implies and control the effect forward and reverse flow and strong of goods, services, and related information between the point of origin and point of consumption, in order to meet the customers requirements. Logistics activities: Customer service Demand forecasting Distribution communication Inventory control Material handling Order processing Part and service support Plant and warehouse side selection Procurement Packaging Return goods handling Salvage and scrape disposal Traffic and transportation Warehousing and storage Logistics is designing and managing of a system n order to control the flow of material throughout a corporation. This is a very important part of an international company because of zoological barriers. Logistics of an international co., includes movements of raw materials, coordinating flows into and out of different countries, choice of transportation, and cost of transportation, packaging the product for shipment, storing the product, and managing the entire process.

Objectives and functions of SCM


The objectives of supply chain integration are to supply quality good faster, with efficient processes and in essence be more responsive to the perceptions of the marketplace and be able to change directions at will. Some of the consequences of supply chain integration result in. Reduced inventory at all sites of supply chain. Reduced of costs

Faster processing speeds. Reduced lead times. Reduced warehouse costs. Reduced obsolescence. Greater responsiveness to customer changes. Electronic links to suppliers and customers. Continuous flow of products and information. Speeding up the development cycle.

Functions
Supply uncertainty can be addressed through a number of initiatives such as vendor development and certification, sharing of production we identify 15 key thrust areas of SCM which would lead to specific decision areas. Minimizing uncertainty: Supply Uncertainty due to unreliability of vendors, process planning information and joint attention to transport arrangements. Process uncertainty is due to machine breakdowns, uncertain yields and absenteeism, which can be addressed through good maintenance practices, better technology. Etc. Demand uncertainty can be reduced to some extent by forecasting techniques and by better communication with customers. Reducing lead times: Lead time, at the stages of procurement, conversion and distribution can be cut down by faster modes of transport, better planning practices and process technologies. Minimizing the number of stages: In general, the number of stages that goods and servces flow through adds to the complexity of SCM. Unification of tasks and reducing the number of stages make the coordination of decisions easier. This is the essence of another management concept, namely Business Process Reengineering. Improving flexibility: Reducing set up or change overtimes in various processes and the use of flexible manufacturing assembly techniques improves the flexibility of response. In transport, the use of smaller vehicles provides flexibility in making dispatches at short notice without being constrained by batching economies. As an extended principle, wherever possible, batch process should be made continuous process. Improving process quality: A prerequisite to effective SCM in the light of reducing inventories and wastage is to do things right, the first time. This is deal for improving process quality. The techniques for this include statistical process control, root cause analysis of poor quality and improvement of process capability.

Making Variety: Variety is one of the major causes for inventory in the downstream part of supply chains. One response appropriate promotion and branding. This will enable a better control of the supply chain, right from demand generation. Delaying Differentiation: The value addition through product differentiation should be postponed as far as possible, so that precise customer needs can be met wit out holding committed stocks in the entire chain. There are numerous examples of how this can be done, such as shipping of component level goods level goods to examples of how this can be done, such as shipping of component level goods to major points and assembling according to customer needs, postponing, finishing operations the grinding and mixing of additives to cement till near the final point of consumption, etc. Kitting of supplies: In assembly systems, a major source of delay is the staging delay where some components for assembly have to wait since matching components are not available. Vendors or internal facilities that supply components can be arranged so that all components required for an assembly (or major sub assembly) are manufactured or supplied to one stage where they are kitted into sets of matching components, ready for assembly and further operations. This could involve some restructuring of vendors of internal activities and some vertical integration. Focusing on A Category: This is a well-known idea from classical economies and inventory theory where items that account for a large part of the value, or which are critical, and / or customers who significant, and / or territories that are important, receive special attention. Planning for Multiple Supply Chains: Doing better SCM would often require different supply chains for different customer segments based on response requirements. The tendency to club supply chains in the interest of efficiency can be counter product ivy for effectiveness. Modifying Performance Measures: These need to move from being single actor focused to multi actor focused in the supply chain. For example, in the context of a warehouse, instead of warehouse space utilization as the primary measure of warehouse performance the retrieval time would be more in tune with SCM, since this focuses on both the warehouse and the downstream actor. Similarly, a transporter like the railways would focus more on time taken for delivering a wagon/ rake to a customer from the time the indent is placed, rather than wagon utilization/ turn around. Comparing on service: The big opportunity in SCM for long-term competitive advantage is on the service aspects of value delivery to the customer. Product quality and features can only be short term advantages. Moving from functions to processes: Improving supply chain practices will require integrated process orientation rather than functional organization. Job rotation, flatter and lean organizations will help.

Taking Initiatives at an Industry Level: This is very essential, especially in dealing with poor infrastructure. Industry level (rather than firm level) initiatives in specific product categories can focus on say transport and / or warehousing inadequacies and help to develop opportunity for third party logistics services here.

5. Q what is logistics Management? Examine the concept and importance of logistics management. (Or) 6. Q. How is logistics used for gaining competitive advantage and delivering superior customer service? . (Or) 7. Q. What is the role of logistics in making strategic decisions?

Introduction
Logistics is one of the most important segments of the phenomenon of marketing in business. It is a subset of SCM. In the business functioning, the trader gets the order for supply of his good or services through marketing executives or directly from customers and then to execute the order to the satisfaction of the customer, the trader or his supplier company prepares the logistics i.e., procures the product or services, puts labels on them, or gives some identification trademarks name to them, makes necessary packing and packing so as to save them from damage of any kind during loading, unloading, handling, transportation etc., Till is supplied to the end customer. More simply, it is bundle of goods finally supplied to the customer.

Definition The logistics is derived from French word loger, which means art of war pertaining to movement and supply of armys. 1. A military concept 2. Fighting a war requires: i) Setting an objective ii) Meticulous to achieve the objective iii) Proper development to troops iv) Supply lines consisting of weaponry, food, etc., 3 A logistics plan should be such that there s minimum loss of men and material. Similar to fighting a war in battlefield, marketing managers also prepare a suitable logistics plan that is capable of fulfilling the company objective of meeting the demand of targeted customers in a profitable way.

Inbound logistics + Material management + physical distributions = logistics. 1. Inbound logistics means the movement of materials received from suppliers. 2. Material management means the movement of material & components inside a firm. 3. Physical distribution refers to movement of goods outward from the end of the assembly line to the customer. 4. Supply-chain management is larger than logistics and it links logistics more directly within the users communication network and with the firm engineering staff. It not only includes manufacturer and suppliers but also transports warehouses, retailers and customers themselves. 5. According to Council of Logistics Management logistics is the process of planning, implementing and controlling the efficient, effective flow and storage of goods, services and related information from the point of origin to the point of consumption for the purpose of confirming the customer requirement. Logistics management includes the design and administration of systems to control the flow of material, work-in-process, and finished inventory to support business unit strategy. The concept of logistics
Logistics Logistics is the part of the supply same process that plans, implies and control the effect forward and reverse flow and strong of goods, services, and related information between the point of origin and point of consumption, in order to meet the customers requirements. Logistics activities: Customer service Demand forecasting Distribution communication Inventory control Material handling Order processing Part and service support

Plant and warehouse side selection Procurement Packaging Return goods handling Salvage and scrape disposal Traffic and transportation Warehousing and storage Logistics is designing and managing of a system n order to control the flow of material throughout a corporation. This is a very important part of an international company because of zoological barriers. Logistics of an international co., includes movements of raw materials, coordinating flows into and out of different countries, choice of transportation, and cost of transportation, packaging the product for shipment, storing the product, and managing the entire process.

Importance of logistics
Logistics has gained importance due to the following trends: 1. 2. 3. 4. 5. 6. 7. Transportation cost have risen rapidly due to the raise in oil prices Production efficiency has scale new heights Fundamental changes in inventory Proliferating product lines Computer technology Increased use of computers Increase in public concern about the product growth of several new large retail chains are mass merchandise with large demands and very sophisticated logistics services, by passing traditional channels and distribution. 8. Economic regulation reduction 9. Increase in power of retailers 10.globalization

8. Q what are the elements of logistics? Explain the mode of logistics? Introduction
Logistics is one of the most important segment of the phenomenon of marketing in business. It is a subset of SCM. In the business functioning, the trader gets the order for supply of his good or services through marketing executives or directly from customers and then to execute the order to the satisfaction of the customer, the trader or his supplier company prepares the logistics i.e., procures the product or services, puts labels on them, or gives some

identification trade marks name to them, makes necessary packing and packing so as to save them from damage of any kind during loading, unloading, handling, transportation etc., Till is supplied to the end customer. More simply, it is bundle of goods finally supplied to the customer. Logistics management includes the design and administration of system to control the flow of material, work-in-process, and finished inventory to support business unit strategy.

The concept of logistics


Logistics Logistics is the part of the supply same process that plans, implies and control the effect forward and reverse flow and strong of goods, services, and related information between the point of origin and point of consumption, in order to meet the customers requirements. Logistics activities: Customer service Demand forecasting Distribution communication Inventory control Material handling Order processing Part and service support Plant and warehouse side selection Procurement Packaging Return goods handling Salvage and scrape disposal Traffic and transportation Warehousing and storage Logistics is designing and managing of a system n order to control the flow of material throughout a corporation. This is a very important part of an international company because of zoological barriers. Logistics of an international co., includes movements of raw materials, coordinating flows into and out of different countries, choice of transportation, and cost of

transportation, packaging the product for shipment, storing the product, and managing the entire process.

Mode of transportation in logistics: The supply chain management has a lot to think about while selecting a mode of transportation for the products. The following issues need to be resolved. 1. Negotiation rates and routes. 2. Selecting routes and carries. 3. Appearing before regulatory agency to support or protest the change in rates effecting the company. 4. Evaluating carrier performance. 5. Analyzing transportation cost and services. 6. Operating company-owned means of freight and passenger transportation. 7. Auditing fright bills to ensure that the proper changes where paid to carriers. 8. Carriers can be grouped n to the following major categories: 9. Common carries, who hold out their service to all who wish to, use them. 10. Contract carriers, who haul freight for individual companies on a contract basis. 11. Private carries, who own both the equipment they use and the freight carried.
12.Common carries trend to be the most costly regulated by public authorities, contract carries less so, with private and exempt carries enjoying the most freedom for economic regulation. All types, however, must observe the laws and regulation governing safety. Rail Rail has pride of place in the history of transportation of almost every country of the world. One of the major advantages of the rail is the ability to haul large quantities of products over long distances. The rail, of course, is not without its problem s. When revenue runs low, economies are obtained in operating costs by slighting the maintenance of way and equipment. Still, rail reigns supreme as an economic and efficient hauler of bully items over long distances. Motor Carriers Motor Carriers can be divided into categories according their legal status:

Common carriers, who must serve all who ask services (pr vided, of course, the carrier has the necessary equipment). Contract carriers, who haul freight for individual shippers under specific written agreements. Private carries, who own the freight they haul. Exempt carriers, who haul farm products, fish or livestock, or who operate within the confines of a single city. Note that any carrier becomes exempt while hauling the named products. Brokers, who own and operate no equipment but bring together (as any broker does) those who wish to ship freight and those who wish to haul it.. Highway transports can be extremely flexibly if a local carrier does not have the exact type of equipment. This ability to tailor the service to the specific type of traffic means added convenience to shippers. Truckers offer both truckload and less than truckload service, but most shipment by highway seems to be of the small, less-than-truckload variety. Oil Pipelines Not all p0ipelines, of course, carry petroleum products. Pipelines are not especially fact and, in fact, rank last in speed of the major modes of transportation since they move their contents at less-than 5miles per hour. Crude petroleum can lose up to 1qurter of a percent of its volume in transit through the line, while a refined product such as petrol or kerosene can loss up to 1%. Water Transportation Water transportation within the national travels along rivers and cannels. Speed is slow and made even slower when ice or floods clog the water ways; but water can carry large bulky cargos this bulk cargo consist mainly of cold petroleum grain and iron ore. The capacity of some modes of water transportation is quite large weather presents a continuing problem ice can bring shipping to a complete halt, thus requiring companies that rely on water transportation to maintain enough inventories on hand to last through the icing season. Storms can be sudden and sever enough, with savage winds and high waves, to sink heavily laden vessels. Air Transportation: Air freight has never enjoyed the glamour accorded to passenger aircraft, although many passenger airplanes are able of handling a considerable amount of fright in the cargo holds beneath the passenger compartments. Many jet aircraft can function in a dual capacity. Air , by whatever type of airline, is generally considered a premium means of transportation is fast, but the freight rates are correspondingly high. Unless speed is an important factor in delivering parts to prevent the shutdown

of an assembly line or to meet a delivery date to a valued customer, some less expensive means of transportation will usually suffice. Probably the biggest headache faced by airline management is control over costs. Other Modes of Transportation Other modes of transportation include the freight forwarder who accepts small shipments and changes less carload (or less truckload or less planeload) rates and consolidates the small shipments into carload truckload, or plane load lots, which are then sent by the lower quantity rates. Frequently, the freight forwarder acts as a traffic cooperatives offer much the same services as the forwarder in consolidating small shipments into larger once, expect that the profits of the business are returned to the members of the cooperative. Small packages can be sent via speed post, and can use some of the expedited delivery services the Indian Post System now offers. 9. Q. What is operating model for supply chain management? A. Strategic supply chain management is directly related and draws strength from the business strategy of an organization. As a matter of fact, the supply chain strategy is developed from business strategy. Components of supply chain strategy 1. 2. 3. 4. 5. Sourcing strategy Distribution strategy Inventory strategy Customer service strategy Strategy of integration

1) Sourcing Strategy: Since in house manufacturing companies, they rely on sourcing and developing vendors with elaborate system to check and control quality.

Manufacturing Management The functional areas decides such issues as to how production should be organized and managed. The production planning & control system have been designed to maximize efficiency of labor and utilization of machines. Always the production process has to optimize balance between customer satisfaction and efficiency. Made of Buy Decisions; Traditional approaches on make or buy decisions have considered such factors such as cost of in house manufacturing cost sourced suppliers, labour cost changes, recovery of overheads, underutilized capacity in plant and machinery, transportations etc. It now calls for considerations of faster deliveries, easy access for service, repairs and replacements and customer preferences. Capacity Management: This calls for decisions to locate plants for in house processing and suppliers and to fix capacities for both plant & suppliers. Traditionally, the decisions on location of plant were taken based on considerations such as cost of land, Govt, subsidies cost of power, availability of labour and other manpower, govt, concessions on taxes, industrial relation etc. But more important considerations have emerged proximity to customers, cost of decisions, supply channel infrastructure availability, access to service facilities, access to various modes of transport network, access to IT are the new emerging considerations. 1) Distribution Strategy: The distribution strategy decision is not only important as it involves consideration of distribution costs, this decision is involved on total marketing costs, but also calls for a long term commitment to certain type of casts associated with a channel of distribution. Factors of distribution strategy I. Channel selection II. Distribution planning

i.

Channel selection: Now a days number of channels is available. These include dealers, retailers, stockiest, storage or stocking stations, and distribution channels some of the major participants decisions on alternatives such as the number of participants and their efficiency of supply chain system and the business results of organization. ii. Distribution planning: The suppliers can be carried through wide variety transportation choices. The transportation helps to achieve a higher level of customer satisfaction, and to increase the sales by business opportunities. So many corporations tend to own transport vehicles. Transportation costs also constitute as an important mode capacity, location, routing, and the schedules of distribution so that; supplies reach the destination on time. 1) Inventory Strategy: This constitutes the core of SCM. The major cost of the supply chain, the level of customer satisfaction business growth/fall is largely influenced by the inventory strategy. Inventory strategy can be considered to comprise of three elements; i. Demand forecasting: The call for determination of the demand of the products for period considered many products in the products have a seasonal demand. Demand planning is needed to organize the sourcing strategy & Stock policies. A number of forecasting methods are available to carry out demand planning in a systematic manner. ii. Inventory planning; once the demand is forecast, the organizations to determine levels of production to develop an inventory policy. This includes maximum stocks, maximum levels of stocks, reorder levels, lead time for procurement, order level quantity etc., inventory planning also includes setting up of a procedure and fixing time schedules for monitoring the inventories and exercising controls. Inventory planning is required to be carried at all the channels of supply chain system. So proper inventory management reduce the costs while raising the levels of customer satisfaction. iii. Planning of stock Facilities: Adequate stocking facilities are needed for keeping stocks at each of the channels stock stations. The strong facilities should be sufficient to carry the inventory in safe conditions, storage facilities, and this plan is used for to minimize the cost of transportation. 1) Customers Services Strategy: Customer can be defined as an end user. As Evans and Danks define, a corporation finally has to draw up a strategy defining methods and means to respond to the needs and expectations of its customers in a manner that maximizes profitability. Inputs for customer service strategy.

A. Service needs B. Service cost C. Revenue Management Many companies have a discovered the importance of servicing the customers. These companies no longer refer to sales as selling of their products but as selling of relationships, support and case. Customer service is being offered in many forms post warranty support, fast repairs, qualified, component and customer friendly technicians are some of the apparent services. Now a days many companies are taking different strategies. a) b) c) d) Segmentation of customers Product service strategy Geographic location strategy Service cost (including delivery cost)

1) Integration Strategy: In traditional supply system, suppliers and many factures operate rather independently. Suppliers have very little information of what manufactures need until they receive orders from manufactures similarly. Manufactures do not know what material are available with suppliers until they place order and get a corresponding response. The status of information with many factories as to what is in stock with a multitude of distributors, dealers and retailers is hardly available and if available is seldom reliable.

In SCM, manufactures, suppliers, distribution channels and customers are linked in the form of chain develop and deliver products as a single organization of pooled skills and resources. The process of linkages between the participants in the most significant factor. Higher the integration process, greater is the success of a supply chain system.