An Introduction To Supply Chain Management Commerce Essay
The term supply chain management was first coined by a U.S. industry consultant in the early 1980s. However, the concept of a supply chain in management was of great importance long before, in the early 20th century.
Supply chain management is the word coined for the effective management of all the partners and the information disseminated between them. Take an example of Dell computers, Micheal Dell cant built his business just by selling the computers to the customers, but he need to see the complex problems of the customers and solve these problems through just in time manufacturing of the product, then how to minimize the wastage in the production then to evaluate what customers are doing and how they can make their production efficiently (NYT 2010), as the manufacturer cannot sell the product at the higher prices than the competitors are selling but through effective management you can actually reduce the cost, so concisely he need to be a master of supply chain management.
Before supply chain management there was effective inventory control system exist but due to some pit falls like; no supply chain metrics, inadequate definition of customer service, , organizational barriers, inaccurate delivery status data, simplistic inventory stocking policies, inefficient information systems, ignoring the impact of uncertainties, and an incomplete view of the supply chain (Teigen 1997). There is a need for another system that have all the competences to deal with all these problems, so the supply chain management is evolved which is not only efficient and effective but also have a good collaborative and communication strategies. Then the evolution of supply chain management activities is started and up till now six phases/era for the development of the supply chain management issues have been seen that are Creation, Integration, and Globalization (Movahedi et al., 2009), Specialization Phases One and Two, and SCM 2.0.
2.2.1 Definition of supply chain management
There are many definitions formed for supply chain management as there are many different perspectives for the understanding of the concept from supply chain management, a global perspective says that in SCM the managers do the integration of the key business process across their supply partners, to enhance customer value and satisfaction among all the stakeholders (Lambert, 2008).
Supply chain management was a quickly emerging, if still problematic, element of business-to-business e-commerce in the late 1990s and early 2000s. (Enclyclopedia of e-commerce 2009)
For the better understanding of the supply chain management, one needs to understand the term management. Management is defined as the planning, control the goal oriented activities and the execution of the plan to achieve the goal. The figure (1) will explain the whole process of the management. And as it have been that these days supply chain is become complicated so a proper management is required.
Figure 1. Management role in supply chain
Source: NEVEM-workgroup (1999)
Today's supply chains are too complicated to be controlled based on intuition. It is necessary to have access to statistical data on the performance of the supply chain.
Supply chain management (SCM) is actually the management of equipments, finances, information and manpower resources by ensuring the two way flow among the different organizations and in the organization itself. Through the effective management of these resources actually they are ensuring that the goods or service delivering efficiently and effectively to the end customers. So in supply chain management the important most factors Synchronized movement of the logistic from the supplier to the manufacturer, then the wholesaler and retailer, until the product reach to the end customer (TSENG, 2001). Through synchronized movement we mean that when the product reach to the distributer and when...
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