Supply chain management (SCM) Is the management of a network of interconnected businesses involved in the ultimate provision of product and

service packages required by end customers (Harland, 1996). Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point-of-origin to pointof-consumption (supply chain).
What is supply chain management? Supply chain management (SCM) is the combination of art and science that goes into improving the way your company finds the raw components it needs to make a product or service and deliver it to customers. There are four major decision areas in supply chain management: 1) location, 2) production, 3) inventory, and 4) transportation (distribution), and there are both strategic and operational elements in each of these decision areas.

Network of organizations and processes for: Procuring raw materials Transforming them into products Distributing the products

Upstream supply chain: Firms suppliers, suppliers suppliers, processes for managing relationships with them

Downstream supply chain: Organizations and processes responsible for delivering products to customers

Supply Chain Strategy or Design

Decisions about the structure of the supply chain and what processes each stage will perform Strategic supply chain decisions Locations and capacities of facilities Products to be made or stored at various locations Modes of transportation Information systems Supply chain design must support strategic objectives Supply chain design decisions are long-term and expensive to reverse must take into account market uncertainty

. Supply Chain Planning Definition of a set of policies that govern short-term operations Fixed by the supply configuration from previous phase Starts with a forecast of demand in the coming year

Supply Chain Planning Planning decisions: Which markets will be supplied from which locations Planned buildup of inventories Subcontracting, backup locations Inventory policies Timing and size of market promotions Must consider in planning decisions demand uncertainty, exchange rates, competition over the time horizon

Push vs Pull System In Push systems, work release is based on downstream demand forecasts Keeps inventory to meet actual demand Acts proactively e.g. Making generic job application resumes today (e.g.: exempli gratia)

In Pull systems, work release is based on actual demand or the actual status of the downstream customers May cause long delivery lead times Acts reactively

e.g. Making a specific resume for a company after talking to the recruiter Supply Chain Management Applications Supply chain planning systems Model existing supply chain

Demand planning Optimize sourcing, manufacturing plans Establish inventory levels Identifying transportation modes

Supply chain execution systems Manage flow of products through distribution centers and warehouses