SUPPLY CHAIN

MANAGEMENT
 Supply Chain Management(SCM)
is the supervision of materials, information, and
finance as they move in a process from supplier to
manufacturer to wholesaler to retailer to
consumer. This involves collaborating and
incorporating flows both within and among
companies. Supply chain activities cover everything
from product development, sourcing, production,
and logistic as well as the information systems
needed to coordinate these activities.
The main goal:
1. Collaborative Effort for Efficiency
2. Maximized Transportation and
Logistics
3. Quality Enhancement
4. Long Term Stability and Relationship
The main goal:
1. Collaborative Effort for Efficiency-
When managing inventory, transportation
and logistic are difficult and expensive for
organizations that do not have an
effective system. Producers, wholesaler
and retailers work together on a supply
chain system.
The main goal:
2. Maximized Transportation and
Logistics- Each company is in charge in
ordering, shipping and transporting goods.
In this structure, costs are high and timing
is poor. With supply chain management,
sellers and buyers plan maximized
transportation and logistic activities.
The main goal:
3. Quality Enhancement- Getting
consumers the best value is shared goal of
supply chain partners. To closely connect
is the objective of perpetual quality
improvement. Retailers, as the most
direct link between consumers and goods,
are the ones who often hear formal and
informal feedback about product.
The main goal:
4. Long term stability and
relationship- through structuring
strong trusting supply chain
relationships and working toward best
practices in distribution, companies
aim for long-term stability and
relationship.
Key Process of Supply Chain
Management:
1. Customer Relationship Management-
this will allow companies to prioritize
their marketing focus on different
customer groups based on each group’s
long term value to the company or supply
chain.
Key Process of Supply Chain
Management:

2. Customer Service Management-

this is a multi-company, unified system of
responding to customers’ complaints,
concerns, questions or comments.
Key Process of Supply Chain
Management:
3. Demand Management- this process
tries to align supply and demand
throughout the supply chain by foreseeing
customer requirements and creating an
action plan before actual purchasing of
customer.
Key Process of Supply Chain
Management:

4. Order-fulfillment- this engages in

generating, filling, delivering and
providing on-the-spot service for
customer’s orders.
Key Process of Supply Chain
Management:
5. Manufacturing Flow Management-
this ensures that firms in the supply
chain have the necessary resources to
produce with flexibility and to move
products in a multi stage production
process.
Key Process of Supply Chain
Management:
6. Suppliers Relationship Management -
this provides structural support for
developing and maintaining good
relationships especially with highly
valued suppliers in order to gain
performance advantages.
Key Process of Supply Chain
Management:
7. Product Development and
Commercialization - this facilitates the
joint development and marketing of new
products and services among a group of
supply chain partner firms.
Key Process of Supply Chain
Management:
8. Returns Management- this enables
firms to manage volumes of returned
product efficiently while minimizing
related costs.
Logistics Components of the Supply Chain:

Logistics is the strategic managing of

the efficient flow and storage of raw-
materials, in-process inventory and
finished goods from the point of origin
to point of consumption
Logistics Components of the Supply Chain:
1. Sourcing and Procurement-the aim is
to loosen the cost of raw materials and
supplies.
2. Production Scheduling-it calls for
additional products to be
manufactured.
Logistics Components of the Supply Chain:

3. Order Processing-it processes the

requirements of the customer and
sends the information into the supply
chain through the logistic information
system then to the warehouse.
Logistics Components of the Supply Chain:

4. Inventory Control- this system

develops and maintains enough variety
of materials or products to meet a
manufacturer’s or consumer’s
demands.
Logistics Components of the Supply Chain:

4. Warehousing and Materials Handling-

storage aids manufacturers manage
supply and demand or production and
consumption.
Logistics Components of the Supply Chain:
4. Transportation-this concerns the
decision on the mode of transportation
of goods from suppliers to producers
and from producers to customers.
• Cost Capability
• Transit time Accessibility
• Reliability Traceability
 Value Chain
A value chain is a set of activities
that a firm operates activities in a
specific industry in order to deliver a
valuable product or service to the
market.
 Value Chain
The idea of value chain is based on
the process view of organization, the
idea of seeing a manufacturing (or
service) organization as a system, made
up of subsystems with inputs
transportation processes and outputs.
 Value Chain Primary Activities:
1. Inbound Logistics- arranging the
inbound movements of materials, parts,
and/ or finished inventory from
suppliers to manufacturing or assembly
plants, warehouses, or retail stores.
 Value Chain Primary Activities:
2. Operations- concerned with managing
the process that converts inputs(raw
materials, labor, and energy) into
outputs(goods & services).
 Value Chain Primary Activities:
3. Outbound Logistics- the process
related to the storage and movement of
the final product and the related
information flows from the end of the
production line to the end user. .
 Value Chain Primary Activities:
4. Marketing and Sales- selling a product
or service and processes for creating
communicating, delivering, and
exchanging offerings that have value for
customers, clients, partners, and
society at large.
 Value Chain Primary Activities:
5. Service-includes all the activities
required to keep the product/service
working effectively for the buyer after
it is sold and delivered.
 Value Chain Support Activities:
1. Procurement-acquisition of goods,
services or works from outside external
sources.
2. Human Resource Management-consist
of all activities involve in recruiting,
hiring, training developing,
compensating and dismissing or layon-
off personnel
 Value Chain Support Activities:
3. Technological Development-pertains to
the equipment, hardware, software,
procedures and technical knowledge
brought to bear in the transformation of the
firm inputs into outputs.
4. Infrastructure-consist of activities such
as accounting, legal, finance, control,
public relations, quality assurance and
general management.