Explained Supply Chain Management in 10 Minutes

technology is advancing at a record clip and customer expectations are rapidly changing today's winning supply chain strategies depend on an efficient demand-driven operating model that can coordinate people processes and technology to provide products and services quickly and precisely supply chain management has always been an essential part of every successful business but is now more critical than ever the only companies that will succeed in today's fast-paced technologically driven economy are those that can successfully manage their supply chains to respond to the many changes that inevitably will occur what is supply chain management supply chain management is the coordination of the flow of goods and services from point a to point b including the processing of raw materials into final products supply chain management also known as scm is actively simplifying a company's supply-side processes to increase customer value and achieve a competitive edge however despite popular belief for the contrary logistics is only one part of the supply chain digitally based sem systems include material handling software for all parties involved in product or service manufacturing order fulfillment and information tracking this industry chain includes suppliers manufacturers distributors transport companies logistics firms and retailers logistics including transportation and fleet management and order management are also an element of the supply chain along the procurement product lifecycle management supply chain planning including inventory planning and enterprise asset and production line maintenance and logistics supply chain management scm can also include activities related to international trade such as coordinating products and services between different countries evolution of scm even before the first product was made and sold supply networks had already been in place scm advanced alongside industrialization letting businesses streamline their operations across the board from manufacturing to distribution the standardization of vehicle parts by henry ford for instance was a revolutionary step that paved the way for mass manufacturing to fulfill the needs of an expanding consumer base sem systems have gradually become more complex as time has passed thanks to developments like the development of computers but scm has been administered by supply chain experts in a linear compartmentalized fashion for many decades this used to be the case but it has all changed thanks to the advent of the internet technological advancements and the development of the demand-driven global economy unlike in the past today's supply chain does not progress straightly it is a wide variety of networks that can be accessed whenever necessary customers are the driving force behind these networks because they have high expectations for completing their orders exactly when and how they specify which advantages does supply chain management have when executed correctly supply chain management allows companies to obtain an edge in the market by speeding up the delivery of their products to customers some examples of how scm achieves this without demanding price cuts from the business are as following to you through scm cutting down operational expenses can be significant costs related to manufacturing and procurement are cut down allowing this to happen if you operate a grocery shop and want to buy your tomatoes straight from the farmer you can save money by avoiding a middleman you may save money and get the product on the shelf faster if you buy it straight from the manufacturer partnerships that can sustain future growth are what scm creates the grocery store owner can help farmers expand their businesses by forming strategic agreements with them at the outset supply chain management helps keep up with fluctuating product demand to continue with our supermarket analogy if you buy tomatoes directly from the farmer you have more freedom in terms of price and quantity as a result of scm customer service can be improved in efficiency and quality this happens when things are delivered to clients promptly and as promised for instance if a farmer delivers tomatoes to a grocery shop the product is more likely to be fresh and undamaged than if it had to go through a middleman to the store successful supply chain management maximizes earnings by enhancing customer satisfaction and decreasing operational expenses costs should be monitored and minimized to maintain a healthy profit margin when the price of inputs like raw materials and labor decreases operating costs also fall now you will see about the role of supply chain management in the economy cost savings the cost savings of supply chain managers can try to save costs in several ways including by enhancing production procedures supplier relationships and inventory management supply chain cost productions have the added benefit of increasing firm earnings connected supply chain supply chains may look like unrelated strands of businesses but they are intricate webs of organizations all working together to get goods to customers however there is more than meets the eye as the entire planet may be considered a single supply chain all parties involved in the distribution production and sale of the good or service have an ongoing dialogue from when raw materials are procured until the final customer receives and uses the product consequently supply chain managers need to prioritize transparency and open lines of communication among all involved parties as well as the development of their internal infrastructure external alliances and third party providers shared understanding and communication supply chain management is crucial to the stability of any society to build a solid supply chain all parties involved must be able to communicate and share relevant data in real time the first step in accomplishing this is establishing reliable connections among all participants in the supply chain with an emphasis on facilitating open lines of communication and fostering a shared vision the supply chain managers are responsible for minimizing the time it takes for data to travel from the final customer to the original source and the possibility of any mistakes being made along the way increasingly 21st century manufacturers rely on cutting-edge tools that provide real-time updates on order progress for customers and vendors enhance quality of service to customers another direct result of well-managed supply chains is enhanced customer service this is because sem procedures guarantee timely delivery of the correct number and products connecting manufacturers and retailers expedites delivery and boost happy customers in most cases supply chain management also improves transparency so that consumers and customer support agents are always aware of where their orders stand organizational agility supply chain management is crucial for keeping businesses flexible enough to deal with unforeseen problems and variations companies may more rapidly identify issues and implement remedies if they streamline supply chain procedures and increase visibility in addition running what a scenario studies and developing backup plans for your production schedule will help you analyze your options rapidly and settle on the most beneficial course of action for your business how does scm function in its simplest form supply chain management may be broken down into three phases material data and money businesses in the supply chain all fall into one of these broad classifications some further details regarding each product formation storage and transportation at all supply chain stages are part of the product flow in addition quality control must be performed at every manufacturing site sales and purchase orders are sent and received and delivery statuses are updated all as part of the information flow all the other operations rely on the truthfulness of the data transmitted throughout the supply chain hence its smooth operation is crucial finances processes include payment processing stock control invoice generation and credit policies components of scm everyday foods like bread and butter go through a complex distribution chain before they finally reach our tables the farmer plants the seeds and sells the wheat to the merchant who then sells the wheat to the baker this is a pretty accurate description of what supply chain management entails as a result of their mutual involvement in creating and distributing goods and services the companies that make up a supply chain are intimately connected supply chain management is the thread that connects the various products and services we rely on every day to function smoothly and efficiently anyone weak link in this network can cause widespread disruption throughout the system several elements comprise supply chain management which is crucial to its functioning elements of supply chain management strategies one of the most crucial steps has been taken strategies need to be finalized and implemented before the supply chain can begin it is essential to verify the need for the product or service and its competitiveness costs profits and available workforce it will be challenging for the company to attain meaningful or lasting success without a well thought out plan or strategy since this is such an important step we must allocate sufficient time finalizing the plans and weighing all the benefits and drawbacks is necessary an organization's strategies must be developed according to a plan blueprint or route map successful supply chain management relies on anticipating consumer and producer needs which can achieve through careful planning data continuous information flows have become the norm in today's environment a company's success depends on its ability to keep up with knowledge developments across all production areas information on supply and demand changes in the market is most useful when it is shared quickly and accurately throughout the organization in today's knowledge base global economy lacking any understanding in any business area can be disastrous production a system's capacity for producing goods is a key feature that's only feasible if everything else in the supply chain works harmoniously proper planning supply of commodities and inventory management are necessary to kick off the production process after manufactured goods they undergo quality control inspections before being packaged and ready for shipment proximity to succeed and grow any company must locate in an advantageous area consider the case of a plant producing carbonated beverages opening in a region with limited access to potable water such operations cannot function without easy access to water inadequate water supply may reduce output and harm the company's reputation if a company needs to split a scarce resource with the community it will go out of business quickly that's why it's so important for a company to be in a convenient easily accessible spot adjacent to its primary sources of raw materials when establishing a new company division it's essential to consider the number of employees it needs and whether it can find them infrastructure transportation is crucial when getting supplies the factory and finished goods out to customers shipping products on schedule is essential to the continuity of any business activity a company's ability to produce and ship its items on time is directly tied to how well it cares for this component the business must prioritize a risk-free and secure transportation system the transportation management system must prevent all losses or damages during transport whether built in-house or outsourced the foundations of safe transportation are a well-managed logistics system and accurate billing we discussed some of the tactics and methods used in supply chain management thank you for watching our video which we think you'll find interesting please know that we value your time and effort in watching our video and sincerely want you'll find it helpful be sure to click the like button

Channel: Leaders Talk

Views: 80,372

Keywords: supply chain management course, supply chain management basics, supply chain management business, supply chain management explained, supply chain management definition, supply chain management jobs, supply chain management careers, supply chain, what is supply chain management, supply chain management salary, logistics, importance of supply chain management, supply chain secrets, what is supply chain management?, logistics and supply chain management

Id: NPYvE0Gmab4

Length: 10min 44sec (644 seconds)

Published: Sat Sep 10 2022