SUPPLY CHAIN MANAGEMENT

BY
SHREY GUPTA
ROLL NO :18
SCM DEFINITION
Supply chain management refers to the close
linkage and coordination of activities involved
in buying, making, and moving a product. It
integrates business processes to speed
information, product, and fund flows up and
down a supply chain to reduce time,
redundant effort, and inventory effort and
inventory costs.
SUPPLY CHAIN
The supply chain is a network of organization
and business processes for procuring raw
materials, transforming these materials into
intermediate and finished product, and
distributing the finished products to customers.
It links suppliers, manufacturing plants,
distribution centers, retail outlets, and customers
to supply goods and services from source
through consumption
REPRESENTATION OF SUPPLY CHAIN





The wide arrows show the flow of material
between supply chain members, and the
other arrows show the flow of information.

SUPPLIER MANUFACTURER DISTRIBUTOR RETAILER CUSTOMER
EVOLUTION OF SCM
IMPORTANCE OF SCM
Inventory reduction
Productivity Improvement
Personnel reduction
Cost reduction
High customer satisfaction
Increased profit
On-time delivery fulfillment

IMPORTANCE OF SCM
Revenue/profit increase
Better cash management
Better order management

FUNCTIONS OF SCM
Inventory Management
Distribution Management
Channel Management
Payment Management
Financial Management
Supplier Management
Transportation Management
Customer Service Management

SUPPLY CHAIN PROCESS
1 PLAN
Balance resources with requirements.
Align supply chain plan with business financial plan.

5 RETURN
Authorize returns.
Schedule returns.
Receive returns.
Issue return credit.
2 SOURCE
Identify suppliers.
Schedule deliveries.
Manage inventory.
3 MAKE
Schedule production.
Evaluate quality and
performance.
Manage work force.
4 DELIVER
Select carriers.
Route shipments.
Manage warehouses.
Invoice customers.
SCM APPLICATIONS
The objective of supply chain management
systems is information visibility-open and
rapid communication and information sharing
between members of supply chain.
Supply chain management enable the firm to
generate demand forecasts for a product and
to develop sourcing and manufacturing plans
for that product.
Supply chain management helps in the flow of
products through distribution centers and
warehouses to ensure that products are
delivered to the right location in the most
efficient way.

SUPPLY CHAIN PRINCIPLES
Segment customers based on service needs
Customize the Supply Chain Management
network
Listen to signals of market demand and plan
accordingly.
Differentiate product closer to the customer.
Strategically manage the sources of supply.
Develop a supply-chain-wide technology
strategy.
Adopt channel-spanning performance
measures.
RELATIONSHIP BETWEEN SCM &
FINANCIAL OUTCOME
OBJECTIVES OF SCM
1. Purchasing
Stable volume requirements
Flexible delivery time
Little variation in mix
Large quantities
2. Manufacturing
Long run production
High quality
High productivity
Low production cost
OBJECTIVES OF SCM
3. Warehousing
Low inventory
Reduced transportation costs
Quick replenishment capability
4. Customers
Short order lead time
High in stock
Enormous variety of products
Low prices

TYPES OF SUPPLY CHAIN SYSTEMS

SUPPLY CHAIN PLANNING SYSTEM


SUPPLY CHAIN EXECUTION SYSTEM


SUPPLY CHAIN PLANNING SYSTEM

Includes
Order Planning- selects an order fulfillment
plan the meets the desired level of service to
customers.
Advanced scheduling and manufacturing
planning- provide detailed coordination of
scheduling and manufacturing based on
various analysis
Demand Planning
Transportation Planning


SUPPLY CHAIN EXECUTION SYSTEM

Order Commitments- enable vendors to quote
accurate delivery dates to customers.
Final Production- organize and schedule final
subassemblies.
Distribution Management- coordinating the
process of transporting goods.
Reverse Distribution- track the shipment and
accounting for returned goods.

PROCESSES THAT ARE USED IN SCM
ELECTRONIC DATA INTERCHANGE (EDI):- EDI is
used to link supply chain participants through
electronic exchange of documents from one stage
to other.
Benefit of this is that paperless exchange of
information takes place.
BAR-CODING AND SCANNING:- Barcode is
designed to represent the item code and other
information.
It is labeled or printed on the item.
Barcode scanners are seen at point of sales
system locations, in the libraries and other stores.

PROCESSES THAT ARE USED IN SCM
DATA WAREHOUSE AND DATA MINING:- Data warehouse
is a consolidated business information database for use
in strategic decision making, decision support systems
and analysis of business in different dimensions.
INTERNET/INTRANET/EXTRANET:- These are used to
network the supply chain partners for communication
and information sharing located anywhere in supply
chain .
WORLD WIDE WEB:- Web technology is used to store
and share information useful for supply chain
participants. It is also used for order placement, order
tracking, e-buying.