SHIFT TO SUPPLY CHAIN MANAGEMENT By Shri D N Chakravarti National Vice President, East, IIMM, Ex-HOD, MM, Kolkata Port

Trust, Faculty, IIPM, IISWBM, IIMM BOS Member, NSOU A.C.M., Burdwan University Supply Chain Management is an integrated Management of all the linkages and value adding activities from the supplier's supplier to the customer in such a way that enhanced customer in such a way that enhanced customer value is achieved at lower cost.

SLACK CHAIN INEFFICIENCY HIGH STORAGE POOR STRATEGIES DELAYED MOVEMEMENTS UNDER UTILISATION OF RESOURCES

TIGHT CHAIN FIRE FIGHTING IN ADEQUATE STORAGE

SUPPLY CHAIN MANAGEMENT ACTIVITIES MEASURE DELIVERY PERFORMANCE RETURN OF INVESTMENTS/ASSETS PROFIT RESPONSIVENESS TO THE CUSTOMER RESPONSIVENESSTO THE MARKET

KEY PLAYERS OF SUPPLY CHAIN MANAGEMENT

SUPPLIER MANUFACTURER RETAILER CONSUMER

ADDITIONAL ACTIVITIES

PRODUCT/SERVICE FLOW FUND FLOW INFORMATION FLOW REUSE RECYCLE MAINTENANCE AFTER SALES SERVICE

SUPPLY CHAIN FUNCTION

SUPPLY PLANNING STRATEGIC NETWORK DESIGN NETWORK POLICY OPTIMISATION FINITE CAPACITY PLANNING MANUFACTURING SCHEDULING VISUALISATION/RESCHEDULING IN REAL SITUATION

DEMAND STATISTICAL FORECASTING MARKET INTELLIGENCE RECONCILATION TRANSPORT MARKETING ROAD/MODE SCHEDULING INTRA/INTER ROUTE OPTION

SUPPLY CHAIN STRATEGY

INTEGRATION

PUSH/PULL POSTMONEMENT/PREPONEMENT OF PRODUCT GO TO MARKET/CHANNEL

CYCLE OF ACTIVITIES DEVELOP A SUPPLY CHAIN STRATEGY MANAGE/GRAB CUSTOMERS ORDERS PROCURE MATERIAL PRODUCE FINISHED GOODS/SERVICES MANAGE TRANSPORT LOGISTICS/DISTRIBUTION

Supply chain is a collection of functional activities that are repeated many times throughout a channel in which raw materials are converted into finished products in order to add value in the eye of customers and to fulfill their requirement. This entire channel of activities is known as Supply Chain. So many players are involved actively in this chain at different stage and success or failure of the chain entirely depends on performance of the each player.

FINANACE
S1
MONEY FLOW C1

S2

SUPPLIERS

INFORMATION FLOW

CUSTOMERS
C3

C2

S3

MATERIAL FLOW

TRANSPORTER SUPPLY SIDE

DISTRIBUTION SIDE

SUPPLY CHAIN NETWORK

Basically supply chain has two parts Supply side and Distribution side. In supply side raw materials are supplied, processed and converted into final products and in Distribution side it transported to the end customers. The key players of the supply chain are Manufacturer Here we mean the focal firm (main supplier) as the Supplier. Its function is to procure raw materials from other sub-suppliers (like S1, S2 and S3 etc.) and after processing converted them into a final product. Suppliers supplier Associates from whom the focal firm procures raw materials in order to make a final product. Focal firm may procure raw materials from many others firms in that case they are known as suppliers supplier (viz. S1 / S2 / S3 in the diagram) and here focal firm is the customer to them and they are the individual supplier for the focal firm. Transporter Who coordinates between supply and distribution side of the supply chain. Function of the transporters is to ensure delivery of the final products from the focal firm to the end-customers within the delivery period and at lowest possible cost. Transporters play a vital role in the chain and Success / failure of the chain largely depends on their performance. In the process of Transportation there are 4 key-factors to be considered for ensuring movement of products to the customer in the most cost and timeeffective manner Load How much to load? In a consignment how much quantity are to be loaded to satisfy the requirement of the customer in most cost-effective way. Mode What mode of transportation to be chosen? For example what mode of transportation should we choose for transporting - road, rail, air or waterway? Flow What should be the flow of material? Should it be unidirectional or multi-directional, we have to decide to ensure minimum cost and to save time. Route What will be the route of transportation? Objective is to determine in which shortest possible route consignment can reach to the customers in time and at lowest possible cost. Customer - They are the most important players of the supply chain as all the activities of the chain are designed and executed to fulfill and satisfy their requirement. Focus is on the customers satisfaction how best way we can serve him/her by delivering the products at right time and at lowest possible cost ensuring proper quality. Distributing Agents They are the various intermediaries of the distribution side of the chain. They distribute the final products received from the focal firm to the end-customers through various sub-agents, like Distributors, Wholesalers, Dealers, Retailers and Marketing Agents etc.

Banks They play very important role in providing finance and control money flow of the entire chain. One hand, banks provide financial help to the various players of the chain and on the other hand they control the money flow of the chain.