Part - I

Overview of Supply Chain Management

Supply chain management (SCM) refers to the management of activities that procure raw materials, transform those materials into intermediate goods and final products, and deliver the products through a distribution system to the end-user.

There are numerous key factors that play an important role in the successful management of supply chains in today's dynamic environment. Among those are: paying utmost attention to the needs and desires of the end customer, designing flexibility into the supply chain for rapid response to changing conditions, utilizing the latest communication and logistics technologies, employing a sound measurement system for making the right decisions, and always communicating through the total supply chain.

Several key issues should be addressed in the design and management of supply chains. The most critical among those are distribution network configurations, inventory control system, product design, information technology, supply chain integration and strategic partnering.

Recent advances in SCM

As we move on in the 21st century, like all other functions supply chain management is in a state of metamorphic flux. Several new technologies are creeping into SCM which are reshaping this crucial business function. Some of these forces and technologies have been described in brief.

1. Information Technology

The Internet as well as the intranet (connecting the workstations within an organization) and extranet (electronic network among business partners, e.g., EDI) have revolutionized the management of supply chains. The power and flexibility of these networks offer businesses more control over the flow of products, services and funds than ever before. Dramatic results have been obtained from using information to improve supply chain performance.

The Web has created a rare opportunity for organizations to access global markets. It allows for mass customization, stronger business relationships, a greater degree of channel coordination, and enhanced communications with customers and business partners.

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* Contributed by -
Siddharth Mohan Patnaik, B.Tech. (Electronics),
Ravulpathi Janaki, B.Tech. (Mechanical),
II Year, IIM Lucknow.