SUPPLY CHAIN MANAGEMENT

Value Chain Supply side- raw materials, inbound logistics and production processes Demand side- outbound logistics, marketing and sales.

WHAT IS SUPPLY CHAIN MANAGEMENT

" Is the strategic management of activities involved in the acquisition and conversion of materials to finished products delivered to the customer"

Supplier Management

Material Flow
Information Flow
Stock Deployment

Customer Management

Schedule / Resources

Conversion

Delivery

Leads to Business Process Integration

 Supply chain is the system by which organizations source, make and deliver their products or services according to market demand. Supply chain management operations and decisions are ultimately triggered by demand signals at the ultimate consumer level. Supply chain as defined by experienced practitioners extends from suppliers suppliers to customers customers.

 SUPPLY CHAIN INCLUDES :

MATERIAL FLOWS INFORMATION FLOWS FINANCIAL FLOWS

Supply Chain Structure

SUPPLIER FACTORY DC RDC RETAILER

Raw Materials

Finished Goods Information Flow

 SUPPLY CHAIN MANAGEMENT FACILITATED BY :

PROCESSES STRUCTURE TECHNOLOGY

IS

 Supply chain serves two functions:

Physical

Market mediation

 Supply chain objectives may differ from situation to situation. For functional products, cost efficiency is the critical factor. For innovative products, responsiveness is the important factor. Leanness + Agility together make up Leagility

Supply Chain and Demand Chain

Demand chain is defined as the system by which organizations manage sales and distribution of products and services to end users. Conceptually incorrect to look at demand chain separately

SUPPLY CHAIN ELEMENTS

Strategic Supply Chain Design Resource Acquisition Long Term Planning (1 Year ++) Production/ Distribution Planning Resource Allocation Medium Term Planning (Qtrly,Monthly)

Tactical

Operational

Shipment Scheduling Resource Scheduling Short Term Planning (Weekly,Daily)

 Supply Chain Goals

Efficient supply chain management must result in tangible business improvements. It is characterized by a sharp focus on
Revenue growth Better asset utilization Cost reduction.

The steps involved

Step1- Designing the supply chain
Determine the supply chain network Identify the levels of service required

Step 2 - Optimizing the supply chain Determine pathways from suppliers to the end customer
Customer markets to Distribution centers Distribution centers to production plants Raw material sources to production plants Identify constraints at vendors, plants and distribution centers Get the big picture Plan the procurement, production and distribution of product groups rather than individual products in large time periodsquarters or years

Step 3- Material flow planning

Determine the exact flow and timing of materials Arrive at decisions by working back from the projected demand through the supply chain to the raw material resources Techniques
ERP

Step 4 - Transaction processing and short term scheduling

Customer orders arrive at random This is a day to day accounting system which tracks and schedules every order to meet customer demand Order entry, order fulfillment and physical replenishment

Thank You