The supply chain is a term that is used to refer to the movement of goods, financial resources and information from the producer to the consumer. Intermediaries (wholesalers and retailers) are often part of the chain as well. Supply chain management (SCM) is the act of overseeing this process and making sure that the movement is seamless. The process will be deemed as being effective if there will be a reduction in inventory.
There are three types of flows that have to be considered individually and collectively: product flow, information flow and financial flow. Product flow refers to the movement of goods and services from the supplies to the end consumer. Information flow is the transmission of orders and updating consumers on the status of their orders as they are transported to them. Financial flow concerns title ownership arrangements, consignments, payment schedules and credit agreements.
The increased use of web-based applications in SCM is one of the measures that have been undertaken to increase the efficiency. The available applications fall under two major categories: planning and execution applications. Those that fall under the planning category are mainly involved with the placement of orders. Those classified as execution orders, in contrast, are used in tracking products, financial information and other materials.
Open data models used by some of the applications make it possible to share data within an enterprise or between the enterprise and other stakeholders. This is what leads to what is sometimes referred to as an extended enterprise. When the data is to be shared, it will be held in a number of data warehouses found at different sites in different companies. By sharing the data with suppliers, the time-to-market of goods is markedly minimized.
Another important change that a company needs to undertake so as to realize the benefits of SCM is to shift from the management of individual functions to integrated functions. The collaboration involves the various departments within a company as well as suppliers, clients and product developers among others. For instance the purchasing department has to communicate with the marketing department to establish the number of units of a product to be bought.
Business have been under pressure to be more environmental conscious. It is interesting to note that about 75% of carbon footprint for an average company. All the enterprises in the supply process should strive to ensure that they reduce environmental damage to the very minimum. As a manager, appreciate that consumers are becoming increasingly preferential of products that have been produced through processes that cause the least impact to the environment.
Supply chain managers need to be certified to increase their chances of securing employment opportunities. The first step in this regard is to acquire the relevant skills and knowledge in all the relevant areas. Such include, for example, transportation, warehousing of goods, inventory management and business continuity skills among others. Most countries have professional bodies that take care of the registration process.
Managing the supply chain ensures that goods and services move from the supplier to the consumer as intended. Delays within the chain will affects all the players involved. It is important that information is shared between departments in an enterprise and between different enterprises working together to make the process seamless.
There are three types of flows that have to be considered individually and collectively: product flow, information flow and financial flow. Product flow refers to the movement of goods and services from the supplies to the end consumer. Information flow is the transmission of orders and updating consumers on the status of their orders as they are transported to them. Financial flow concerns title ownership arrangements, consignments, payment schedules and credit agreements.
The increased use of web-based applications in SCM is one of the measures that have been undertaken to increase the efficiency. The available applications fall under two major categories: planning and execution applications. Those that fall under the planning category are mainly involved with the placement of orders. Those classified as execution orders, in contrast, are used in tracking products, financial information and other materials.
Open data models used by some of the applications make it possible to share data within an enterprise or between the enterprise and other stakeholders. This is what leads to what is sometimes referred to as an extended enterprise. When the data is to be shared, it will be held in a number of data warehouses found at different sites in different companies. By sharing the data with suppliers, the time-to-market of goods is markedly minimized.
Another important change that a company needs to undertake so as to realize the benefits of SCM is to shift from the management of individual functions to integrated functions. The collaboration involves the various departments within a company as well as suppliers, clients and product developers among others. For instance the purchasing department has to communicate with the marketing department to establish the number of units of a product to be bought.
Business have been under pressure to be more environmental conscious. It is interesting to note that about 75% of carbon footprint for an average company. All the enterprises in the supply process should strive to ensure that they reduce environmental damage to the very minimum. As a manager, appreciate that consumers are becoming increasingly preferential of products that have been produced through processes that cause the least impact to the environment.
Supply chain managers need to be certified to increase their chances of securing employment opportunities. The first step in this regard is to acquire the relevant skills and knowledge in all the relevant areas. Such include, for example, transportation, warehousing of goods, inventory management and business continuity skills among others. Most countries have professional bodies that take care of the registration process.
Managing the supply chain ensures that goods and services move from the supplier to the consumer as intended. Delays within the chain will affects all the players involved. It is important that information is shared between departments in an enterprise and between different enterprises working together to make the process seamless.
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