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SCM

Supply Chain Management (SCM) is a comprehensive approach to managing the flow of information, goods, services, and funds from raw material sourcing to end consumer delivery. It integrates various functions such as purchasing, manufacturing, and distribution to enhance efficiency and reduce costs. The evolution of SCM has shifted from physical distribution to a more collaborative model that includes logistics management and external partnerships to optimize performance and customer satisfaction.

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11 views

SCM

Supply Chain Management (SCM) is a comprehensive approach to managing the flow of information, goods, services, and funds from raw material sourcing to end consumer delivery. It integrates various functions such as purchasing, manufacturing, and distribution to enhance efficiency and reduce costs. The evolution of SCM has shifted from physical distribution to a more collaborative model that includes logistics management and external partnerships to optimize performance and customer satisfaction.

Uploaded by

mahavirkothekar797
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Supply Chain Management

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SCM

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SCM: Defined as
 SCM is the total system approach to manage
the flow of information, goods & services and
funds from the source of raw material to the
ultimate consumption
 It is network of facilities that procure raw
material convert it into finished product and
then supply it to the end users with
distribution network
 It is a strategy to integrate purchasing,
manufacturing, planning distribution and
marketing functions to manage individual
conflicts
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SUPPLY CHAIN
MANAGEMENT
SCM term is coined by Keith Oliver from
consultancy firm Booz Allen Hamilton in 1982

Value chain

• Supply side- raw materials, inbound logistics


and production processes
• Demand side- outbound logistics, marketing
and sales.

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• - Supply chain is the system by which
organizations source, make and
deliver their products or services
according to market demand.
• - Supply chain management
operations and decisions are
ultimately triggered by demand
signals at the ultimate consumer level.
• - Supply chain as defined by
experienced practitioners extends
from suppliers’ suppliers to customers’
customers.
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What is Supply Chain
Management (SCM)?
 Managing supply and demand
 Sourcing raw materials and parts,
 Manufacturing and assembly
 Warehousing and inventory tracking
 Order entry and order management,
 Distribution across all channels, and

delivery to the customer.

-The Supply Chain Council

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• SUPPLY CHAIN INCLUDES :

– MATERIAL FLOWS

– INFORMATION FLOWS

– FINANCIAL FLOWS

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 Need of Supply chain Management

– 1. Demanding customers
– 2. Shrinking product life cycles
– 3. Proliferating product offerings
– 4. Growing retailer power in some cases
– 5. Doctrine of core competency
– 6. Emergence of specialized logistics
providers
– 7. Globalization
– 8. Information technology

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Functions of SCM
 Purchasing
 Inbound transportation
 Quality control
 Demand and supply planning
 Receiving, material handling & storage
 Inventory control Order processing
 Production planning, scheduling & control
 Warehousing/Distribution Shipping
 Outbound transportation
 Customer service

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Objectives of SCM
 To reduce the time
 To control inventory
 To Reduced costs
 To Increase efficiency
 To Increase out put
 To Increase profits
 To maintain sustainability
 To develop information technology
 To manage material, information and money

flow
 To manage demand and supply
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Evolution of Supply Chain
Management

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Physical Distribution: Inventory
Push era: 1970
 It is the process of making movement of the
product to the customers, Physical flow of
products from manufactures to consumers
 Making the products available at right time at
right place
 It focuses on movement, storage and
distribution
 Market the product over an extensive
marketing territory
 It includes outbound logistics which focuses
on customer service requirements
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 It involves 5 different activities
- Order transmission
- Order processing
- Order selection
- Order transportation and
- Customer delivery
 Integration of warehousing, transportation

and physical distribution of finished of


goods

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 Elements of physical distribution
- Communication
- Warehousing
- Inventory management
- Transportation
- Material handling

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Logistics
 By the end of 1970’s firms recognized the
benefits of coordinating, inbound and
outbound logistics
 This coordination of inbound and outbound
logistics for efficient use of physical
infrastructure is called as Logistics
 Logistics management is that part of SCM
which manages the efficient, effective
forward and reverse flow and storage of
goods, services and information from point of
origin to the point of consumption

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 The key objective of logistics is supply
driven
 It focuses on the objective of cost

minimization within a limited context


 Then started the customer pull era in the

beginning of 1980’s
 Specialization with respect to various

logistics activities for lowering cost


 It then lead to the development of

electronic data system and use of ERP in


1990’s
 This extended in internet based

collaborative system which is called as SCM


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SCM
 Logistics management graduated to SCM to
include scope to link external partners like
suppliers, distributors, service providers and
customers with a view to deliver enhanced
value to customer by synchronized
management of flow of physical
goods, information and cash between source
to customer
 SCM transcends single company concept
 It seeks for inter-firm collaborative

arrangements for better performance

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 SCM involves
- Sourcing

- Procurement

- Conversion and all logistics activities

- Coordination and collaboration with channel

partners
“ In essence, SCM integrates supply and demand
management within and across companies”
“SCM focuses on profit maximization in long run
by focusing on customer satisfaction.
“ SCM also deals with Marketing, finance,
development, operations, distribution and
customer service”

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