What is Supply Chain Management (SCM)? Types of Supply Chain Management (SCM) Systems. Benefits, levels, and the key functions of a supply chain.

What is supply chain management? (scm)

What Is Supply Chain Management (SCM)?/ SCM Meaning/ define supply chain management.

Supply chain management involves the management of the flow of goods and services and all the processes that transform raw materials into final products. It involves the active flow of supply-side activities of the business to maximize customer value and gain a competitive advantage in the market.

Represents an effort by SCM suppliers to develop and implement supply chains as efficiently and economically as possible. Supply chains cover all the information from production to product development in the information system needed to manage these initiatives.

Topic outline

What Is Supply Chain Management (SCM)? What is the example of supply chain?
How Supply Chain Management Works?
Types of Supply Chain Management (SCM) Systems
What are the three levels of supply chain management? 
What are the four pillars of supply chain management? 
What are the stages of supply chain management?
What is the best practice in supply chain management?
What are the key functions of a supply chain?
What is a supply chain flow chart?
The importance of supply chain management
Supply chain management process
What is the greening supply chain?/ Green supply chain.
Why green supply chain management is important?
Supply chain risk management/ How do you manage supply chain risk?
What is supply chain automation?/ supply chain automation.
What does a supply chain manager do/ What are the responsibilities of a supply chain manager?


What is the example of supply chain?

Examples of supply chain activities include farming, refining, design, manufacturing, packaging, and transportation.

How Supply Chain Management Works?

Typically, SCM seeks to centrally control or link the production, shipment, and distribution of a product. By maintaining a supply chain, companies are able to reduce additional costs and deliver products faster to customers. This is done by keeping strict control of internal inventory, internal production, distribution, sales, and listing of vendors of the company.

SCM is built on the idea that almost every product that comes to market comes from the efforts of different organizations that create a supply chain. Although supply chain has existed throughout the ages, most companies have recently focused on their activities as value addition.

At SCM, the supply chain manager integrates the logistics of all aspects of the supply chain into five parts:

  • Plan or strategy
  • Source (raw material or service)
  • Manufacturing (focusing on productivity and efficiency)
  • Delivery and logistics
  • Return system (for defective or unwanted products)
The supply chain manager tries to reduce shortages and keep costs low. The work is not just about logistics and purchasing lists. According to Salary.com, supply chain managers, "Recommend improving productivity, quality, and operational efficiency".

Improvements in productivity and efficiency go directly to the bottom line of any organization and have a real and lasting impact. Good supply chain management keeps companies out of the headlines and away from costly recalls and lawsuits.

Types of Supply Chain Management (SCM) Systems

Depending on the work that supply chain management systems perform, they are divided into two categories, namely, supply chain planning systems, and supply chain execution systems.

1. Supply Chain Planning Systems

These systems provide information that helps businesses plan their supply chain. Some important supply chain planning works are as follows:
  • Predict the demand for specific products and prepare sourcing and production plans for those products.
  • Determine the quantity of product that must be produced within a certain period of time.
  • Decides where to store finished items.
  • Transport mode identification used to deliver goods.
  • Determining the level of deposit for raw materials, intermediate products, and finished products.
  • The quantity of the product should be determined to meet the needs of all customers in the business.

2. Supply Chain Execution Systems

These systems provide information that helps businesses implement their supply chain measures. The following are some of the key supply chain tasks:
  • Ensuring proper delivery of products from manufacturers to retailers and ultimately to customers
  • Provide information on the processing status of orders so that sellers can provide customers with accurate delivery dates
  • Tracking the invoice and accounting for products that have been returned or repaired and serviced

Benefits of Supply Chain Management (SCM)

Effective Supply Chain Management (SCM) systems provide the following benefits to optimize company performance.

  • Improve customer service by delivering the right products at the right time and in the right place, which helps you increase the sales of the organization.
  • Enable companies to bring products to market at a faster rate. Thus, companies get their payments sooner than their lack of efficient supply.
  • Reduce total supply chain costs including collection costs, transportation costs, inventors, transportation costs, etc. Reducing costs in the supply chain helps increase firm profitability.

What are the three levels of supply chain management?

Supply chain management operates at three levels: strategic, tactical, and operational. At the strategic level, agency management makes decisions regarding the high-level strategic supply chain that is relevant to the organization as a whole.

The decisions that are made about the supply chain reflect the overall corporate strategy followed by the organization.

The strategic supply chain disciplines that need to be handled will broaden the breadth of the supply chain. This includes product development, customer, manufacturing, vendors, and logistics.




What are the four pillars of supply chain management? 

  1. Data visibility.
  2. Data "slice- and dice-ability.
  3. Focus on the right problem area. 
  4. Alignment with organization and process.

What are the stages of supply chain management?

  1. Original sourcing or raw material extraction.
  2. Refining or manufacturing materials into basic parts.
  3. Combining the basic parts into finished products.
  4. Sales of finished products to end-users.
  5. Deliver the finished product to suppliers or users. 

What is the best practice in supply chain management?

  1. Develop the strategy
  2. Align the supply chain organization
  3. Recruit and develop supply chain professionals
  4. Be dedicated to performance management
  5. Establish the strategic sourcing strategy
  6. Manage total cost of ownership
  7. Establish key supplier alliances
  8. Develop a supplier management process
  9. Streamline the order to payment process
  10. Manage inventory
  11. Manage distribution and logistics
  12. Establish and monitor controls

What are the key functions of a supply chain?

Supply chain functions include product development, marketing, operations, distribution, financing, and customer service. Supply chain management results in lower costs and faster production cycles.

What is a supply chain flow chart?

Chain management processes that benefit from flow charts. As mentioned earlier, the supply chain management process has many stages from start to finish, each of which can greatly benefit from the use of flow charts and workflows. The problems that the supply chain process (collection) can have from start to finish (delivery or distribution) are basically innumerable. These are processes that apply to most supply chain management tasks where flow chart creation and development can lead to ongoing improvement:!

Procurement: Purchase of raw materials or products from suppliers is essential for the supply of chain efficiency. Using flow charts or workflows can help reduce unnecessary vendor analysis /research instances and help streamline purchase orders.

Material Management: Material management refers to the acquisition, inspection, and storage of raw materials used in the manufacturing process. Adherence to the company’s defined workflows can reduce the number of inspection errors, which will reduce the rate of scrap at a later time and increase the yield of the first pass.

Production and Manufacturing: While some companies may not include manufacturing as a partner in their supply chain management activities, it is a key component that falls in the middle of the supply chain process (for manufacturers) to reduce flow bars and machine uptime. Can help increase usage?

Order Management: The order management function is responsible for collecting, verifying, and submitting all the information required to fulfill the customer's order. Documentation of key steps in the order management process through flow charts can help reduce order errors and increase customer satisfaction.

Delivery: Distribution activities handle various responsibilities to the customer starting from inventory and warehouse management till the final delivery of goods/products. Using flow charts in the delivery process can help improve deposit position accuracy, reduce shrinkage, and mitigate order selection errors.

The importance of supply chain management

It is well known that supply chain management is an integral part of most businesses and it is essential for the success of the company and customer satisfaction.

  • Boost Customer Service
  • Reduce Operating Costs
  • Improve Financial Position
       Societal Roles of SCM
  • Ensure Human Survival
  • Improve Quality of Life
  • Protect Cultural Freedom and Development.

Supply chain management process

Supply chain management process

  1. Strategic planning process
  2. Demand planning process
  3. Supply planning process
  4. Procurement
  5. Manufacturing
  6. Warehousing 
  7. Order fulfillment
  8. Transportation

What is the greening supply chain?/ Green supply chain.

Greening supply chain initiatives are part of the process of implementing a sustainable development plan aimed at achieving improved environmental, health, and safety performance; Increase efficiency in the use of energy, water, or other natural resources or raw materials; Reducing the environmental and social impact of business activities on local communities and the global wildlife; And increases the opportunities to increase the economic and quality of life that come from the company’s business activities. click me for a more detailed verson!

Why green supply chain management is important?

Because the green supply chain can reduce environmental pollution and production costs and it can also emphasize economic development, create a greater competitive advantage in terms of customer satisfaction, positive image, and reputation, and provide better opportunities to export their products to environmentalist countries.

Supply chain risk management/ How do you manage supply chain risk?

Manage known risks

Companies can use a combination of structured problem solving and digital tools to effectively manage their known-risk portfolio in four steps:

                            supply chain risk management
Exhibit 1

Step 1: Documenting identified risks,
Step 2: Create a supply-chain risk-management structure,
Step 3: Risk monitoring,
Step 4: Institute Administration and Regular Review. for details clickme!

Manage unknown risks

supply chain risk management

Exhibit 2
Build strong defenses,
Build a risk-aware culture. for details clickme!


What is supply chain automation?/ supply chain automation.

Supply chain refers to the systematizing part or all workflow to improve automation processes. In short, it means using technology to centralize the complex web of causation.

There are a lot of potential benefits to trading auto parts or all supply chains - namely, to reduce manual effort while increasing productivity, efficiency and accuracy.

What does a supply chain manager do/ What are the responsibilities of a supply chain manager?

A supply chain manager is responsible for managing equipment, hardware, and other logistical details of a company, or a company's department. It is their job to take all the necessary steps to procure the raw material, to supply it at different times of the business, to ensure that the company supplies its products in sufficient quantity to meet the customer's demand, and to deliver the output on time.

Supply chain managers are responsible for managing and managing the overall supply chain and logistics strategy and management of the organization to maximize process efficiency and productivity. Also, they play an important role in developing and maintaining good relationships with vendors and distributors.



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