(SCM)

Combination of Art and Science

Purpose: to improve the method a company finds raw components. It needs to deliver a product or service to customers

In the past manufacturers called the shots (push or mass manufacturing)

Today customers call the shots & manufactures scramble to meet demands for options / styles / features, quick order fulfillment, and fast delivery

Manufacturing quality — a long-time competitive differentiator — is approaching parity across the board

Customers' specific demands for product delivery has emerged as the next critical opportunity for competitive advantage

Raw Materials

Manufacture

Distribution

Customer

Companies that learn how to improve management of their supply-chain will become the new success stories in the global marketplace

Plan Source Make Deliver Return

Strategic portion of SCM Strategy for managing all resources

needed to meet customer demand Set of metrics to monitor supply chain for

elimination of waste and added value

Choose suppliers Develop pricing, delivery and payment

processes Metrics to monitor and improve

relationship

Manufacturing step Schedule activities necessary for

production, testing, packaging, and delivery

Most metric-intensive level Measure quality levels Production output Worker productivity

Logistics Coordinate receipt of orders

Develop network of warehouses Pick carriers Set up invoice system to receive payment

Problem working of Supply Chain

Create network for receiving defective and excess product back

Support for customers who have problems with delivered products

Improving a process as complex as the supply-chain can be daunting

Companies are challenged with finding ways to meet ever-rising customer expectations at a manageable cost

Businesses must identify which parts of their supply-chain process are not competitive

Understand which customer needs are not being met

Establish improvement goals

Rapidly implement necessary improvements

Companies that learn how to improve management of their supply-chain will become the new success stories in the global marketplace