SUPPLY CHAIN

MANAGEMENT
Prepared By Dwishank Patil
Meaning and Definition of SCM

 Supply chain management (SCM) is the broad range of

activities required to plan, control and execute a product's
flow, from acquiring raw materials and production through
distribution to the final customer, in the most streamlined
and cost-effective way possible.
 Examples of supply chain activities include farming ,
refining, design , manufacturing ,packaging and
transportation.
Essential Features Of Supply Chain
Management
 Mutually Sharing Of Information : For effective SCM
mutually sharing information among channel members is
required especially for planning and monitoring
processes.
 Co-operation :Cooperation among the channel members
is required for effective SCM.
 Focus on serving customers: Supply chain succeeds if all
the members of supply chain have the same goal and
the same focus of serving the customers.
Essential Features Of Supply Chain
Management
 Integration of Process: The implementation of SCM
needs the integration of the processes from sourcing to
manufacturing and to distribution across the supply
chain. The integration can be achieved through third
party services.
 Mutually sharing risk and Rewards: Effective SCM also
requires mutually sharing channel risks and rewards that
yield an competitive advantage.
Types of Supply Chain

 Static and dominated by Customer in chain

e.g. Toyota,IKEA
 Static and no domination by any one. E.g.
supply to textile machines
 Dynamic and dominated by Customer E.g.
Nokia
 Dynamic and no domination by customer
E.g. Supply to electronics Industry
Success stories in SCM

 Wal-Mart
 Seven-Eleven
 Dell Computer
Objectives of SCM

 Reducing Transportation Cost

 Reducing Warehousing Cost
 Minimizing the Time
 Service Orientation
Functions Of SCM

 STRATEGIC LEVEL:
 Strategic network optimization, including the number ,
location, and size of warehousing ,distribution centers
and facilities,
 Strategic partnership with suppliers ,distributors and
customers.
 Where to make and buy decisions.
 It is for long term and needs the resource commitment
(1 Year +)
Functions Of SCM

 Tactical Level
 Sourcing contracts and other purchasing decisions.
 Inventory decisions including quantity, location , and quality
of inventory.
 Transportation strategy including frequency ,routes ,and
contracting.
 Milestone Payments.
 This is mostly medium term planning(Quarterly or Monthly)
Functions Of SCM

 Operational Level
 Daily production and distribution planning.
 Demand planning and forecasting, coordinating the
demand forecast of all customers and sharing the
forecast with the supplier.
 This is Short term Planning (Weekly,Daily)
Challenges Of SCM

 Uncertainties – Political , Weather ,Strike etc.

 Variation over time due to seasonality , trends ,
promotions
 Managing Conflicts
 Matching Supply and Demand
 Shorter product cycles of High Technology Product
THANKYOU