SCM

SUPPLY CHAIN MANAGEMENT

What is supply chain

Supply chain is the system by which organizations

source, make and deliver their products or services

according to market demand. Supply chain as defined by experienced practitioners extends from suppliers suppliers to customers customers.

SUPPLY CHAIN ELEMENTS

Strategic

Supply Chain Design Resource Acquisition Long Term Planning

Tactical

Production/ Distribution Planning Resource Allocation Medium Term Planning

Shipment Scheduling Resource Scheduling Operational Short Term Planning

Meaning of SCM
SCM systems helps businesses to maintain their relationship with suppliers. Helps to share information about orders, production, inventory levels and delivery products. Make better decision about how to organize and

shedule sourcing, production and distribution

 Supply

chain

management
of a

(SCM)
network

is

the
of

management

interconnected businesses involved in the provision of product and service packages required by the end customers in a supply chain. 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 consumption.

Information system and supply chain management

Problems in supply chain are caused by inaccurate or untimely information. Just in time strategy Bullwhip effect : information about the demand for a product gets distorted as it passes from 1 entity to

another across the supply chain.

Eg: P&G

Supply chain management software

Supply chain planning Supply chain execution

Demand driven supply chain

Push based model Pull based model

 The difference between push- and pull-based

models is summarized by the slogan Make what we sell, not sell what we make. Earlier supply chain management systems were driven by a push-based model (also known as buildto-stock) in which production master schedules are based on forecasts or best guesses of demand for

products, and products are "pushed" to customers

 With Web-based tools, supply chain management follows a pull-based model (or demand-driven model or build-to-order), in which actual customer

orders or purchases trigger events in the supply

chain.

The future internet-driven supply chain

The future Internet-driven supply chain operates like a digital logistics nervous system. It provides multidirectional communication among firms,

networks of firms, and e-marketplaces so that entire

networks of supply chain partners can immediately

adjust inventories, orders, and capacities.

The business value of supply chain management systems includes: Streamlined supply chain and accurate information Reduced supply chain costs Increased availability sales through accurate product