PRESENTATION

ON
SUPPLY CHAIN MANAGEMENT

PRESENTED BY:
Ashish Subedi
Roshna Maharjan
Santosh Raut
Shweta Shakya
TOPICS COVERED
● Introduction to Supply Chain & Supply
Chain Management
● Key issues in Supply Chain
● Components of Supply Chain Management
● Levels of SCM
● Supply Chain Strategies
● E- Procurement
● Supplier Partnership
● Logistic Management
Introduction
● Supply chain is a complex network of facilities dispersed
over the large geography and in many cases all over the
world.

● The different elements of supply chain are customer,

planning, purchasing, inventory, production and
transportation.
Continued…..
 Supply Chain Management
● Supply chain management is the integration of activities that
procure materials and services, transform them into intermediate
goods and final products, and deliver them to the customer.

● Notice
 Everyone is involved
 System approach is involved
 Integration is the key
Supply Chain Management
Objectives of supply chain
● Purchasing
❖Stable volume requirements
❖Flexible delivery time
❖Little variation in mix
❖Large quantities

● Manufacturing
❖Long run production
❖High quality
❖High productivity
❖Low production costs
Supply Chain Management
Objectives of supply chain
● Warehousing
❖Low inventory
❖Reduced transportation costs
❖Quick replenishment capability

● Customers
❖Short order lead time
❖High in stock
❖ Enormous variety of products
❖ Low prices
 Key Issues
● Supply chain management requires innovative planning and careful
research for a successful strategic plan.
● Different issue for supply chain management in global environment
are:
❖React to sudden changes in parts availability, distribution or
shipping channels, import duties and currency rates.
❖Use the latest computer and transmission technologies to
schedule and manage shipment of parts in and finished products
out.
❖Staff with local specialists who handle duties freight, customs
and political issues.
 Components of SCM

1. Plan
2. Develop (Source)
3. Make
4. Deliver
5. Return.
1. Plan
● Develop a strategy for managing all the resources that
go into meeting expected customer demand for a
product or service, including a set of metrics to monitor
the supply chain.

2. Source
● Select suppliers that will provide the goods and
services needed to create products or support services.
● Develop a system for delivery, receiving, and verifying
shipments or services.
● Structure payment along with metrics for monitoring
and, if necessary,improving relationships.
3. Make
● Design the processes necessary for providing services
or producing, testing, and packaging goods. Monitor
quality, service levels or production output, and worker
productivity.

4. Deliver
● Establish systems for coordinating receipt of shipments
from vendors; develop a network of warehouses; select
carriers to transport goods to customers; set up an
invoicing system to receive payments; and devise a
communication system for two-way flow of
information among supply chain partners.
5. Manage returns
● Create a responsive and flexible network for receiving
defective and excess products from customers.
 Three Levels of SCM
1.Strategic Level

● At this level, company management will be looking to high level

strategic decisions concerning the whole organization.
● Such as the size and location of manufacturing sites,
partnerships with suppliers, products to be manufactured and
sales markets.
● Strategic activities include building relationships with
suppliers and customers, and integrating information
technology (IT) within the supply chain.
 Three Levels of SCM
2. Tactical Level

● Tactical decisions focus on adopting measures that will produce

cost benefits.
● Such as using industry best practices, developing a purchasing
strategy with favored suppliers, working with logistics companies
to develop cost effect transportation and developing warehouse
strategies to reduce the cost of storing inventory.
● Studying competitors and making decisions regarding production
and delivery would fall under the tactical category.
 Three Levels of SCM
3. Operational Level

● Decisions at this level are made each day in businesses that affect
how the products move along the supply chain.
● Operational decisions involve making schedule changes to
production, purchasing agreements with suppliers, taking orders
from customers and moving products in the warehouse.
● The operational category includes the daily management of the
supply chain, including the making of production schedules.
Supply Chain Strategies
1.Many Suppliers
2.Few Suppliers
3.Vertical Integration
4.Keiretsu
5.Virtual Companies
1. Many Suppliers
● Commonly used for commodity products
● Purchasing is typically based on price
● Suppliers compete with one another
● Suppliers are responsible for technology,
expertise, forecasting, cost, quality and
delivery
2. Few Suppliers
● Buyer forms longer term relationships
with fewer suppliers
● Create value through economies of scale
and learning curve improvements
● Suppliers more willing to participate in
JIT programs and contribute design and
technological expertise
● Cost of changing suppliers is huge
3. Vertical Integration
● Developing the ability to produce goods or
services previously purchased
● Integration may be forward, toward the
customer, or backward, toward suppliers
● Can improve cost, quality and inventory but
requires capital, managerial skills and demand
● Risky in industries with rapid technological
changes
4. Keiretsu Network
● A middle ground between few suppliers and vertical integration
● Suppliers become part of company coalition
● Often provides financial supports for suppliers through ownership
or loans
● Members expect long term relationships and provide technical
expertise and stable deliveries
● May extend through several levels of the supply chain
5.Virtual Companies
● Rely on variety of supplier relationships to provide services on
demand
● Fluid organizational boundaries that allow the creation of unique
enterprises to meet changing market demands
● Exceptionally lean performance, low capital investment, flexibility
and speed
E-Procurement & Importance
The use of internet to produce goods and services used in the conduct
of business.
Importances:
1.Reduced Cost
2.Transparent Spending
3.Increased Productivity
4.Eliminating Paperwork
5.Increased Transaction Speed
6.Standardized Buying
7.Reduced Errors
Supplier Partnership
1.Supplier Selection

2.Supplier Certificate

3.Relationship Development
Logistics Management

Fig: Logistics Management

Logistic Management
Art and Science of obtaining, producing, and distributing material and
product in proper place and in proper quantities

Part of SCM, that: Plans, Implements and Controls

Supports forward and reverse flow and storage of goods, services and
information from Point of Origin to Point of Consumption
7 R’s of Logistics Management

Fig: 7 R’s of Logistics Management

 Logistics Goals and Strategies
Logistics shares the goal of supply chain management, to meet
customer requirements:

1. Cost Reduction
2. Capital Reduction
3. Service Improvement
Logistics Strategies
1. Coordinating Functions

2. Integrating Supply Chain

3. Substituting Information for Inventory

4. Reducing Number of Partners

5. Pooling Risks
 Logistics Functions
Following areas of logistics management, contribute to an
integrated approach of logistics:

1. Transportation
Objective: Select effective combination to increase value
Air, Rail, Road, Water, Pipeline

2. Warehousing
Receiving, Storing, Shipping
 Logistics Functions
3. Third and Fourth Party Logistics
Manage one or more logistics services or the entire
logistics management

4. Reverse Logistics
Ways to handle returns, re-use, recycling and disposal i.e. it
is journey from customers to suppliers
 THANK YOU
QUESTIONS ????