Supply Chain Stages

A typical supply chain may involve many

different trading partners, called stages
Stages may include:
– Suppliers
– Producers
– Wholesalers/Distributors
– Retailers
– Customers
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 SCM Activities
SCM activities include:
• Coordination
– coordinate the movement of goods, services,
and funds through the supply chain
• Information Sharing
– share forecasts, point-of-sale data, planned
promotional campaigns, and inventory levels
• Collaboration
– jointly plan, operate, and execute business
decisions as one entity
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 Managing Flows Through
the Supply Chain

Managing Flows of Products, Information,

and Funds:

• Flow of Products
– from the beginning to the final customer

– Reverse Logistics

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 Managing Flows Through
the Supply Chain Continued
• Flow of Information
– simplified supply chains utilize data from
point-of-sale back to suppliers
– real time information reduces uncertainty
and inventory levels

• Flow of Funds
– funds are transferred in both directions
along the supply chain
– supply chain compression
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 SCM Versus Logistics
• SCM
– concerns the collaboration between supply
chain partners in a strategic effort to achieve
superior competitiveness

• SCM manages different aspects of the

coordination process such as:
– information – products
– technology – finances
– distribution – relationships

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SCM Versus Logistics Continued
• Logistics
– the part of SCM that is concerned with
managing the flow of inventory

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 Characteristics of a
Competitive Supply Chain

Key characteristics of a competitive supply

chain include:

– Responsiveness

– Reliability

– Relationship Management

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 Responsiveness

The ability to move quickly to

meet customer demands

– Agility

– Short Supply Chains

– Demand-Driven rather than

Forecast-Driven

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 Reliability
• Uncertainty
– uncertainty is the main reason why companies
carry safety stock resulting in higher costs

• Visibility
– visibility improves reliability in supply chains

• Supply Chain Coordination

– sharing of real-time data and information through
information technology improves visibility and
therefore supply chain reliability

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 Relationship Management

SCM is primarily about the management of

relationships across networks of companies

– Traditional Adversarial Relationships

– Relationship Building and Collaboration

– “Single-Sourcing”

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