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What is Supply Chain Management

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What is Supply Chain Management (SCM) SCM Combination of Art and Science Purpose: to improve the method a company finds raw components it needs to deliver a product ... – PowerPoint PPT presentation

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Title: What is Supply Chain Management


1
What is Supply Chain Management
  • (SCM)

2
SCM
  • Combination of Art and Science
  • Purpose to improve the method a company finds
    raw components it needs to deliver a product or
    service to customers

3
Why is it Important?
  • In the past manufacturers called the shots (push
    or mass manufacturing)
  • Today customers call the shots manufactures
    scramble to meet demands for options / styles /
    features, quick order fulfillment, and fast
    delivery

4
Still Why?
  • Manufacturing quality a long-time competitive
    differentiator is approaching parity across the
    board
  • Customers' specific demands for product delivery
    has emerged as the next critical opportunity for
    competitive advantage

5
  • Raw Materials
  • Manufacture
  • Distribution
  • Customer

6
Necessary to Compete
  • Companies that learn how to improve management of
    their supply-chain will become the new success
    stories in the global marketplace

7
Basic Components
  • Plan
  • Source
  • Make
  • Deliver
  • Return

8
Plan
  • Strategic portion of SCM
  • Strategy for managing all resources needed to
    meet customer demand
  • Set of metrics to monitor supply chain for
    elimination of waste and added value

9
Source
  • Choose suppliers
  • Develop pricing, delivery and payment processes
  • Metrics to monitor and improve relationship

10
Make
  • Manufacturing step
  • Schedule activities necessary for production,
    testing, packaging, and delivery
  • Most metric-intensive level
  • Measure quality levels
  • Production output
  • Worker productivity

11
Deliver
  • Logistics
  • Coordinate receipt of orders
  • Develop network of warehouses
  • Pick carriers
  • Set up invoice system to receive payment

12
Return
  • Problem working of Supply Chain
  • Create network for receiving defective and excess
    product back
  • Support for customers who have problems with
    delivered products

13
Five basic elements
  • Plan
  • Source
  • Make
  • Deliver
  • Return

14
Challenges
  • Improving a process as complex as the
    supply-chain can be daunting
  • Companies are challenged with finding ways to
    meet ever-rising customer expectations at a
    manageable cost

15
Challenges
  • Businesses must identify which parts of their
    supply-chain process are not competitive
  • Understand which customer needs are not being met

16
Challenges
  • Establish improvement goals
  • Rapidly implement necessary improvements

17
Promise
  • Companies that learn how to improve management of
    their supply-chain will become the new success
    stories in the global marketplace

18
Future
  • Benchmarking studies show significant cost
    differences between organizations that exhibit
    best-in-class performance and those with average
    performance
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