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Supply Chain Management, Essay Example

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Supply chain management has a great impact on all areas of business. It affects customer satisfaction in a way that people get products in time. It also has an impact on cost savings projects and overall productivity. Indeed, a company is not able to produce an income or profits until the product or service is delivered and paid by the customer.

Supply chain management has one single goal: to manage the chain of supply through the system matching it with the demand of the market. This often involves advanced communication among different suppliers and departments, prediction or reporting of production, delivery. The end result should be to deliver the right product at the right time at the lowest possible cost for the customer’s highest level of satisfaction.

While production management and process improvement methods covered previously within the course are useful, if the product does not arrive at its final destination: in the hands of the end-user, the company fails to meet the market demand.

The main challenges calling for effective supply chain management are: global competition, outsourcing of processes and manufacturing, e-commerce operations, shorter life cycles of products, greater complexity of supply chains and environmental concerns worldwide. Further, cost-advantage development needs to be considered through comparing the cost of inventory with the final price paid by customers. The main costs to be monitored are capital costs, storage costs and risk costs related to holding inventory.

The main difficulty the designers of supply chain management face is the “bullwhip effect”. The fluctuation of production within the supply chain, delivery, lead times and market demand are not level, and the more complicated the chain is the harder it is to manage this phenomenon. A close monitoring of capacity utilization, speed of the product going through the supply chain and the variation of demand throughout time is an effective way of overcoming the bullwhip effect.

Supplier analysis and management is another method to ensure that products are delivered in time and the quantities match market demand. As Apple’s example shows, tracking parts and requesting detailed reports, predictions from suppliers is an effective preventive measure used to eliminate faults within the supply chain. Auditing suppliers while maintaining effective communication and relationships is also essential.

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Essay on Supply Chain Management

Introduction

Supply Chain Management is the management of the gradual flow of goods, services, and production, which include the movement and proper storage of raw materials, logistics, work-in-progress inventories, and finished goods or products. Sunningdale Tech Ltd is a manufacturer of audio equipment, steel moulds, and plastic injection products, among other equipments in Singapore. The purpose of this essay is to analyze as a supply chain manager of Sunningdale Tech Ltd, the effectiveness of the four key flows in supply chain management; the making process, and the supply chain forecasting and all relevant improvements according to the theories and concepts in supply chain management (Davis, 1993).

Sunningdale Tech Ltd is a manufacturing organization focused on building and selling mould and plastic injection products. The company was founded on the December 5, 1995, and the headquarters is located in Singapore. This is one of the leading producers of precision steel moulds in Singapore. They are responsible for designing, marketing, exporting, and managing manufactured technological products like car audio equipment, steel moulds, and plastic injection products; they render product design consultancy, mold flow services, selling of dies, tools, jigs, fixtures, and other plastic components, and project management. Their divisions are Healthcare, Automotive, Information Technology, and Mould Fabrication. Each segment produces a specific product or service; Automotive division mainly produces faceplates for audio systems and climate control, exterior antenna covers, steering switches, and speedometer equipments. The Healthcare division produces scoops, drug delivery, diagnostic devices, and caps. The Information or Consumer Technology division renders water filtration products, grooming products, and inkjet cartridges. The Mould Fabrication segment designs and manufactures various moulds that are also used for manufacturing of plastic injection parts. There are about 28 branches around the world, with over 872 employees. They are able to generate over 120 companies to supply products to on regular basis, in countries like USA, Malaysia, Mexico, and Latvia.

The Key Flows in Supply Chain

The manager of the supply chain is responsible for keeping track of the movement of products, information, cash, end-to-end flow of goods, and return of products. As a supply chain manager of Sunningdale Tech Ltd manufacturing company, there is a role to oversee and manage every stage of the production flow, from purchasing of raw materials to the delivery of the final product, timely production, as well as coordinate the storage of the product. Flow of products in the supply chain is the movement of goods from the organization to various customers across the world.

Sunningdale Tech Ltd work in a very effective production flow within the supply chain management process, this is done by demand planning and product planning, where a specific number of Sunningdale Tech Ltd products are produced within the various factories across many countries. The products are stored following a specified schedule of the organization and transported to larger warehouses of Sunningdale Tech Ltd Company as an inventory hold. The goods are carefully evaluated and transported to various warehouses of retailers of the company in different locations and then get to the various retail outlets of Sunningdale Tech Ltd, the products are then delivered to customers at various point of delivery.

Sunningdale Tech Ltd Company Information flow is very important in supply chain management because this information flow serves as the link between each stage in the supply chain management. There are effective IT technological tools that help enhance the information flow within the supply chain process (Li, et al. 2011). The use of computers and the internet help keep track of information and improve the performance of the organization

Sunningdale Tech Ltd Company cash flow relates to how payments are made based on timing and frequency of payments to suppliers and from customers, vice versa, invoicing steps for customers, how accounts are managed. The flow of cash perspective in supply chain management process can be specified into cost and investment expenses, and the fund or revenue from sales. The cost is the various expenses incurred and investment relates to the payment of various expenses incurred by the organization. Costs are incurred during the supply chain process and contribute to the profitability of the business and require settlement (Patnayakuni, et al. 2006).

As a supply chain manager, the reduction of cost and increasing revenue or fund are very important. Cash expenses are monies paid by Sunningdale Tech Ltd Company to keep the organization operating and revenue cash flow is the movement of monies from customers to the organization. To enable the company to gain profits, revenue must always be higher than the cost incurred. Payment are arranged according to organization’s plans, schedules, credits, and other financial arrangements to receiving cash from the public and in paying expenses of the business are gathered annually and recorded. There is a need to manage various financial flows of the organization.

Inverse flow is the return movement of goods from customers to the company and how the organization refund and collect these goods back into the company safely. Inverse flow of goods from customers or retailers made by receiving information related to any problem of the good to be checked and solved. The return flow passes from the customer to the vendor, then to the retailer, and shipped to the Company. After the correction is made, the product is sent back through the same process to the customer with a discount to enhance customer satisfaction.

(Pedrosoa & Nakanob, 2009)

The Make Process

The Sunningdale Tech Ltd Company have a specified production planning and make process for developing goods for the organization and manufacturing of the organization’s products. This ensures that all resources, investments, and raw materials are enough and accessible for producing goods and services in the organization. Activities involving measures taken as a supply chain manager in directing, regulating, and controlling various productions of the organization is arranged and rolled out accordingly.

The make process is a very important aspect in supply chain management and this requires gradual important steps in manufacturing goods and services in the organization. The success and wellbeing of the organization is linked to tallying the production level of the organization to the resources to produce these organizations. The resources should be enough to facilitate the production of goods and services for the organization successfully. Sunningdale Tech Ltd require appropriate allocation of resources including, workers, raw materials, production machines, product deliveries, transportation of goods to customers, and purchasing raw products from suppliers are done during production planning

The way taken by various products into the organization is arranged and designed to facilitate the movement of products from suppliers to the company. After identifying the routing process of goods, the execution is when customer’s orders are delivered to their locations successfully. This will help avoid frustration and delay in order execution, production that moves with a good plan always help in preventing customer disappointment and help to improve their satisfaction. Good production planning involves the production of the right goods, foreseeing the future, analyzing, and using potential manufacturing plans to achieve set goals. Allocation of resources is done by assigning team members the right task and machines to operate (Longo & Mirabelli, 2008).

Sunningdale Tech Ltd should have proper planning of technological material requirement to be able to analyze needed input resources, components and materials required to produce various products in the organization. The production planning schedule is a widely used system that helps in improving productivity of a given manufacturing organization (Håkan & Göran, 2004).

This planning schedule helps in advancing and improving the production performance of the organization. The manufacturing requirement planning uses information from expenses or cost of materials, production, and flow of goods to understand the needed inputs and various costs during the manufacturing process. Planning the arrangement of materials and other material components of the organization will help enhance the manufacturing success of the various products along with the quantity of the product, with appropriate determination of the right items to produce. The Company identifies the number of confirmed orders and production to make during operations.

As a supply chain manager, my duty is to ensure that the organization have access to needed materials and resources for production of products. There are several products required by customers from the organization, and with demand and order description, I will be able to check and allocate the right materials for production in the organization. Demand directly affects the quantity of goods to produce for customers in general. I will be able to setup a strategic planning system that will be able to track products and supply chain production in the organization.

(Håkan & Göran, 2004).

The Supply Chain Forecasting

Forecasting model in supply chain management relates with the upcoming events expected to take place in the market and production system in the future. This is just like predicting expected future of the organization in a qualitative or quantitative way. The supply chain forecasting methodology and models examine the future expectations and outcome of how demand and supply range will project, how the customer’s reaction towards a specific product will change, and the change in price level of goods in the market (Singh, et al. 2006). There are benefits the organization derives from supply chain forecasting, including helping to prepare for a new condition arising.

The supply chain forecasting will guide the Company know the right goods suppliers are willing to offer the organization, and how these goods will determine the performance of the Company, in order to take necessary measures immediately before becoming too late. Various evaluations are conducted on the market to provide a complete position of the organization in the near future. In forecasting, especially in supply chain management, factors like weather, technology, research, among others relate with the supply chain management of the organization. This describes how these factors will influence consumers demand and interest in each week, months and years (Helms, et al. 2000).

Price forecasting model is a description of supply and demand influence on prices of goods and services in the market. Situations such as a low income, bad road and weather conditions, and poor environmental conditions could lead to a reduction in the price of Sunningdale Tech Ltd products like precision steel moulds, car audio equipment, plastic products and tools, among others. The price forecasting model helps businesses to know when necessary to cut down prices or increase prices and this will help the Company to know when to maximize the price level of products and the time to reduce the price to fit well in the market at a given time (Gattorna & Jones, 1998).

Another model called demand forecasting model that allows organizations to keep the right number of stocks enough to satisfy all demands. The demand forecasting model will help the Company to utilize time, resources, and efforts properly to improving the production of goods at the right time. The demand forecasting model is very helpful in identifying the interest of the public and behavior of the market demands, including preference, trends, seasonal goods, personality, and behavior of the customers (Guanghui, 2012).

Opinion forecasting model is a qualitative forecasting model that describes how the opinions of experienced experts make meaningful analysis and projections into the future without statistical data and where there is no available data to be measured. This model uses an easy and quick method to anticipate future market trends and structure. The market research model is a qualitative forecasting module that uses market research and analysis to forecast future events. This can be done by staff, firm members, and the Company will have researchers to use research opinion poll, telephone, interviews, and questionnaires.

Various quantitative and qualitative model of forecasting relating to average moving model goods, economic model, opinion of experts, research model, and strategic model are classified based on the quantitative and qualitative analysis of the supply chain forecasting model. The moving average model uses the quantitative forecasting model to analyze data and understand data about the market prices, sales, demands, supplies, and many more. The econometric modeling is about how regression analysis and independent regression is measured to determine the influence of an economic variable to another and to understand the outcome of the analysis (Helms, et al. 2000).

(Rogelio & Watson, 2009)

Production across the various four key flows of supply chain management and how to serve as a supply chain manager of Sunningdale Tech Ltd is steep into the making process, and the supply chain forecasting in order to enhance the movement and production of products along the supply chain management process. The various flows of products along the supply chain management process like information flow, cash flow, product flow, and return of goods are major duties of the supply chain manager in order to ensure the positive operation of the business in the organization. Sunningdale Tech Ltd ensures that goods flow from one stage to the other till customers acquire their products and appreciate the product, and the supply chain manager also has to improve the relationship between customers and the organization through technical, brand, and research development. The supply chain manager also ensures that the right supply chain forecasting model such as the demand forecasting model or price forecasting model is used correctly. It is important that technological tools are encouraged and used to induce the positive performance of Sunningdale Tech Ltd supply chain management and maximize information and transactional management potential of the manufacturing company. This helps in improving the effectiveness and efficiency of the business and supply chain management.

Bibliography

Davis, T. (1993).  Effective Supply Chain Management.  Massachusetts: MIT. Retrieved from http://blogt.ethz.ch/ETHambassadors/files/2018/06/Davis-Effective-SCM.pdf

Gattorna, J., & Jones, T. (1998).  Strategic Supply Chain Alignment: Best Practice in Supply Chain Management.  Vermont: John L. Gattorna. Retrieved from https://books.google.com.gh/books?hl=en&lr=&id=pS03aP72VR8C&oi=fnd&pg=PA1&dq=KEY+FLOWS+IN+supply+chain+management+&ots=Uuo2-b6Tx2&sig=OyA6s1Z7xK46UOykRAqNMuAKSgg&redir_esc=y#v=onepage&q=KEY%20FLOWS%20IN%20supply

%20chain%20management&f=false

Guanghui, W. (2012). Demand Forecasting of Supply Chain Based on Support Vector Regression Method.  Procedia Engineering Journal , 280-284. Retrieved from https://www.sciencedirect.com/science/article/pii/S1877705811065441

Håkan, H., & Göran, P. (2004).  Supply Chain Management: Teh Logic of Supply Chains and Networks.  Bingley: Emerald Group Publishing Limited. Retrieved from https://www.ingentaconnect.com/content/mcb/ijlm/2004/00000015/00000001/art00002

Helms, M. M., Ettkin, L. P., & Chapman, S. (2000). Supply chain forecasting – Collaborative forecasting supports supply chain management.  Discover Journals, Books & Case Studies , 1463-7154. Retrieved from https://www.emerald.com/insight/content/doi/10.1108/14637150010352408/full/html

Li, J., Chen, J., & Wang, S. (2011).  Risk Management of Supply and Cash Flows in Supply Chains.  London: Springer Science. Retrieved from https://books.google.com.gh/books?hl=en&lr=&id=2gh9BHT9NRkC&oi=fnd&pg=PR3&dq=KEY+FLOWS+IN+supply+chain+management+

&ots=scwXIMOkGm&sig=0h1oVMkUVz6xfXEhDCQOl3g1pnI&redir_esc=y#v=onepage&q=

KEY%20FLOWS%20IN%20supply%20chain%20management&f=false

Longo, F., & Mirabelli, G. (2008). An advanced supply chain management tool based on modeling and simulation.  Computers & Industrial Engineering Journal , 570-588. Retrieved from https://www.sciencedirect.com/science/article/abs/pii/S0360835207002100?casa_token=HeksMSixGbQAAAAA:w05VLMIDWGIkA2xUQJodfMDZi5cE4Sre72m

G0899jBynpC8RV_6PzdqWsNLk9s7bx3O6SnMrZQ

Patnayakuni, R., Rai, A., & Seth, N. (2006). Relational Antecedents of Information Flow Integration for Supply Chain Coordination.  Journal of Management Information Systems , 13-49.

Pedrosoa, M. C., & Nakanob, D. (2009). Knowledge and information flows in supply chains: A study on pharmaceutical companies.  International Journal of Production Economics , 376-384. Retrieved from https://www.sciencedirect.com/science/article/abs/pii/S0925527309002011?casa_token=umKrV-90DUQAAAAA:AKgRfA9Wzbnb1i2S-hjN3E1d0rVMiDqzrxaTfavIcnC2SKz0gqwoPymlOS2s53eL0mP6oBMQQw

Rogelio, O., & Watson, N. (2009).  Managing Functional Biases in Organizational Forecasts: A Case Study of Consensus Forecasting in Supply Chain Planning.  Sri Lanka: Production and Operations Management Society. Retrieved from https://onlinelibrary.wiley.com/doi/full/10.1111/j.1937-5956.2009.01003.x?casa_token=Ff1e1Js36kQAAAAA%3AftCP3uMN-2rc4mWg_Igcf3NzmFOxoZcieT5peXOVjBet39XGLKDPRLeQmTif9yvCcn4gdj4oGSsLTQ

Singh, N., Olasky, J. S., Cluff, S. K., & Welch, F. W. (2006, 10 29).  Supply chain demand forecasting and planning . Retrieved from Google Patents: https://patents.google.com/patent/US7080026B2/en

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What Is Supply Chain Management, and Why Is It Important?

When COVID-19 began to spread in 2020, many factories and businesses shut down, impacting the global supply chain. According to Axios, 75% of U.S. companies saw their supply chains disrupted early in the pandemic.

The pandemic also caused one-fourth of companies to experience a 50% drop in sales, according to the World Bank. Approximately 1.4 million manufacturing jobs in the U.S. were lost early in the pandemic, according to the National Association of Manufacturers.

Geopolitical issues such as the U.S.-China trade war added to the disruptive forces affecting the global supply chain.

What is supply chain management, and why is it important? Supply chain management is the overseeing of the flow of goods and services from raw materials to final products. It includes all the processes involved in getting products to customers, such as shipping.

As the global economy recovers, demand and supply continue to be at odds with each other. Take, for example, the more than 80 container ships that were waiting to be offloaded outside California ports in mid-November 2021 as the holiday shopping season began, according to a Bloomberg report. This logjam provides a visible example of the importance of effective supply chain management.

Supply chain management keeps the mechanisms of supply and demand operating smoothly so that people have access to goods and services. From sustenance and shelter to the way we work and entertain ourselves, a well-oiled supply chain is critical for maintaining economic stability and a functioning society.

What Is Supply Chain Management?

Supply chain management is the handling of the entire process of turning raw materials into a final product. Without the supply chain, we would not have access to food and health products, or the items that allow us to work, travel and entertain ourselves. Supply chain management involves a network of suppliers connected via a centralized management process. Each supplier acts as a link that moves a product along a chain of production, from raw material suppliers to manufacturers to retailers.

In the past, the supply chain management beginning-to-end model was mostly rigid — every link in the chain was touched in consecutive order to get a product from raw materials to the consumer. But lessons from the recent disruptions highlight the importance of flexibility in the supply chain management process.

What supply chain management is today is largely a result of market evolutions, digital transformations, and changing consumer preferences. Here are a few examples:

• Different ways to buy . Consumers have many choices when purchasing products. They can buy products in physical stores or online, for example.
• Climate-conscious consumers. Consumers have become more aware of how products are manufactured. They want to know about products that are climate-friendly. This affects the initial stages of the supply chain, where manufacturers need to incorporate sustainable practices and sourcing in their operations.
• Evolving trade policies. When a manufacturer is unable to get raw materials from one supplier because of a trade policy, it must be able to adapt quickly and pivot to a new source for its raw materials.

Role of Supply Chain Management

Supply chain management sets the foundation for economic growth by enabling the exchange of goods between businesses and consumers. The important role of supply chain management and its impact on economic growth is possible because of the entities involved in the supply chain, which include the following:

• Materials processors. This includes companies that process raw materials, such as metal, rubber, and wood, from natural resources.
• Manufacturers/producers. These are the companies that create the products available for sale, turning raw materials into products for consumer use. Not all supply chains produce physical products. For example, in the energy sector, energy producers use raw materials, such as coal, to produce a form of energy for consumption.
• Vendors. Also known as sellers, vendors sell products to the next link in the supply chain. Manufacturers can also be vendors.
• Warehouses. Once the products are sold, they need to be stored. Warehouses are often located in major hubs where those involved in the next link in the supply chain can acquire them and ship them to distribution centers.
• Transportation companies. Examples of transportation companies include freighter, container ship and trucking companies. At this point in the supply chain, the products arrive at another site with one purpose: to distribute the product to retailers.
• Distribution centers. Distribution centers are regional facilities that house the products to be redistributed to retailers, wholesalers, and, sometimes, directly to consumers. A distribution center can include refrigeration facilities to preserve perishable products.
• Retailers. At the tail end of the supply chain are the retailers who sell products directly to consumers in shopping centers, stores, and online.

In considering what supply chain management is and why it is important, it is useful to highlight other business functions that impact or are affected by the supply chain.

• Product development. This is the process of introducing and bringing products to the market. It can also involve updating or renewing an existing product. Product development hinges on the materials available to make a product and the ingenuity of individuals to design, engineer and determine the purpose and function of a product.
• Marketing. It is often said that a good product sells itself. In reality, organizations must try to stimulate demand for their goods. This is where marketing comes in. Marketing strategies include advertising and promotion, packaging, pricing, product placement, distribution, and target audience selection.
• Operations. A key aim of operations managers is to ensure the inner workings of a business run efficiently to maximize productivity and reduce costs.
• Distribution. This function is often considered part of the marketing mix. It describes the process of making products available to end-users in business and consumer markets, whether through direct or indirect distributors.
• Finance. This area works with departments like sales to set revenue goals, acquire money or capital and decide how to spend and invest.
• Customer service. This function plays a critical role in how an organization is perceived by its customers. The aim of customer service is to serve customers throughout the buying life cycle, from providing information that may help customers make informed decisions to supporting customer inquiries and troubleshooting customer problems.

Why Is Supply Chain Management Important?

Modern supply chains help improve living standards by enabling consumers to buy essential products at lower costs. This is because an effective supply chain streamlines the process of getting products to market, and ultimately to consumers.

Some key reasons why supply chain management is important to include:

• Basic life necessities. Through supply chain management, individuals access necessities such as food and clothing, as well as life-saving medicines and health care products.
• Power and light . People use electrical energy for homes and businesses for light, heat, and air conditioning. The energy supply chain involves the transformation of raw materials into usable energy and uses supply chain management principles to bring energy resources to consumers.
• Infrastructure. Interstate highway systems, railroads, ports, and airports facilitate the exchange of goods between businesses and consumers.
•   Jobs . Supply chain management plays a critical role in job creation. Supply chain professionals work in areas such as transportation, warehousing, inventory management, packaging and logistics information.

When considering why supply chain management is important, it’s worth noting the potential repercussions of an ineffective supply chain. For example, a lack of raw materials can result in a manufacturer not having the resources to create a product that is in high demand. A scarcity of that product can result in abrupt price hikes, impacting consumers.

Disruption of the Pandemic

The pandemic played a major role in disrupting the current supply chain in several ways. For example, many factories in low-cost manufacturing hubs in Southeast Asian countries such as Vietnam, Indonesia, and Malaysia shut down or slowed production, hitting global companies hard financially.

A disruption at any point in the supply chain can create problems for everyone. Here’s an example of a chain of events due to the disruptions caused by the pandemic:

• Millions of Americans, nearly all at once, stayed in their homes due to the lockdowns.
• Many of them placed orders for goods, such as desks for homebound children learning remotely and furniture for home offices.
• These materials are mostly imported from Asian countries, which faced deadly variants and many
• This led to some factory shutdowns, which hit retailers hard because supply was not available to meet the demand.
• Factories that remained in operation often reduced their activity, contributing to tighter supply and increased prices for raw materials.
• When the price of raw materials went up, the cost of products increased.

In some cases, product prices rose abruptly. Food prices were affected as well. Prices for meat, poultry, fish, and eggs went up 10.5% for the year ending in September 2021, according to data from the U.S. Bureau of Labor Statistics (BLS).

As global markets recover, demand is increasing while manufacturing is still limited, creating a mismatch in the equilibrium between supply and demand. In economic theory, this is known as the scarcity principle.

Geopolitical Factors

Geopolitical forces can tighten the supply of global commodities, creating artificial disruptions in the supply chain. Recently, sanctions and the crackdown on supplying microchips to Chinese companies have disrupted the global semiconductor industry. In a world heavily reliant on technology, the global shortage means limited access to components that run our devices, computers, and electronics. Carmakers have also reported declines in sales due to problems in the global supply chain, including microchip shortages.

Another aspect of geopolitics that affects supply chain management is taxation and documentation at ports. Every country has different rules, regulations, and laws that can often change. This means that exporters and importers must be in tune with the changes to ensure their products make it to their intended destinations. Missing important documentation can mean that a shipment of products may sit at a port indefinitely, creating financial losses for businesses.

Role of Information Systems in Supply Chain Management

Supply chain management has many moving parts, requiring systems and tools that help streamline processes, improve efficiency and strengthen accuracy. The role of information systems in supply chain management is to help businesses manage supply chains through scheduling, sourcing, supplier management, and data analytics.

These systems help organizations oversee the key elements of the supply chain, from resource development to logistics. They can help organizations keep track of different participants in the supply chain, including suppliers, warehouses, transport companies, retailers, manufacturers, and customers.

The primary role of information systems in supply chain management is to ensure businesses have access to the information they need to make the right business decisions. For example, operational visibility allows companies to assess fluctuations and anomalies in their business. By leveraging data in their internal systems (and public data), businesses can act intelligently on identifying and solving supply chain issues before they become big problems.

Information systems can also improve decision-making throughout the supply chain process by helping decision-makers to:

• Be aware of what’s happening at key touchpoints in the supply chain management process (operational visibility)
• Analyze information through visual dashboards and easy-to-understand data using analytics and emerging technologies (for example, machine learning)
• Find opportunities to improve the performance of the supply chain, which can lead to improved profitability and better customer experiences

Role of Finance in Supply Chain Management

The role of finance in supply chain management is vital. Finance and accounting functions bring stability and flexibility to supply chain management by helping suppliers and buyers in the following ways:

• Ensuring payment predictability and transparency. Using financial and accounting principles, organizations ensure a business has strong working capital and meets regulations and tax requirements.
• Extending payment terms. By offering flexible payment terms for items, finance departments at suppliers can help buyers optimize their cash flows, helping to strengthen the buyer-supplier relationship.
• Ensur ing that taxes are Indirect taxation can be a complex process — tax is paid by different entities throughout the supply chain process. The taxes paid are reflected in the final cost of the product, but it is invisible to the customer thanks to finance’s involvement in the process.
• Decreas ing Finance can play a key role in developing strategies that help other functions, such as customer service, to meet customers goals at the least total cost possible.
• Improv ing Firms rely on the role of finance in the supply chain to help control and reduce costs, resulting in opportunities to improve margins.

The role of finance in supply chain management is evolving to help organizations explore supply chain opportunities. This includes using advanced technology that shares financial and transaction data. This visibility into financial data across all entities in a supply chain can help in the creation of sophisticated financing programs focused on optimizing the balance sheet requirements and liquidity of all entities involved in the supply chain.

Finance also collaborates with other functions in an organization, including legal, marketing, information technology and operations, to enhance operational value and minimize risk.

Prepare for a Career in Supply Chain Management

Every step of the global supply chain is interconnected, and everyone involved — from producer to supplier to consumer — plays a pivotal role.

Supply chain management is vital to society, providing the mechanism for getting products into the hands of consumers, from essential staples such as food and medicine to luxury items.

In business, supply chain management allows manufacturers to make as many products as needed to meet market demand. It helps retailers reduce excess inventory and lower the cost of storing products. The success of sales and marketing relies on effective supply chain models that help ensure that the right quality product is available at the right place and at the right time.

For individuals interested in working in supply chain management, an advanced degree in business, such as an online MBA, can help them launch their careers. The Online Master of Business Administration from the University of Maryland’s Robert H. Smith School of Business prepares students to identify, evaluate and mitigate risk; improve efficiencies; and utilize cutting-edge supply chain technology applications.

Learn how the University of Maryland’s Online MBA program and its Supply Chain Management specialization, with courses including Global Trade Logistics and Innovative Solutions to Supply Chain Challenges, can help you pursue your career goals and become a leader in the field.

Recommended Readings

Why Get an MBA? It’s Still the Best Investment You Will Ever Make

Why Consider an MBA in Supply Chain Management

What You Can Learn About the Global Economic Environment Through an MBA

Axios, “Coronavirus Has Disrupted Supply Chains for Nearly 75% of U.S. Companies ”

Bloomberg, “Ships Keep Coming, Pushing U.S. Port Logjam and Waits to Records”

Council of Supply Chain Management Professionals, The Importance of Supply Chain Management

Forbes , “10 Ways Machine Learning Is Revolutionizing Supply Chain Management”

IBM, “What Is Supply Chain Management?”

Investopedia, “Scarcity Principle”

Investopedia, “Supply Chain”

Investopedia, “Supply Chain Management (SCM) ”

National Association of Manufacturers, “How Coronavirus Is Affecting Manufacturers”

Reuters, “Global Economy Factories Hit by Pandemic-Related Supply Disruptions”

SourceToday, “What’s Causing the Supply Chain Shortages?”

SupplyChain, “What’s Causing the Global Supply Crunch?”

SupplyChainBrain, “The Increasing Role of Supply-Chain Finance”

The White House, “Why the Pandemic Has Disrupted Supply Chains”

The World Bank, “Tracking an Unprecedented Year for Businesses, Everywhere”

U.S. Bureau of Labor Statistics, Consumer Price Index

Get More Information.

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Supply Chain Management: Definition, Jobs, Salary, and More

Learn what supply chain management is, why it is important, what the job duties are, and the key elements that make an effective supply chain manager.

Supply change management aligns product supply with customer demand. As the world becomes more interconnected and manufacturing resources are spread across the globe, supply chain management ensures production remains cost-effective, customers remain happy, and deliveries are consistent.

If you enjoy looking at the bigger picture and have a knack for helping companies run efficiently, you might consider a career in supply chain management.

In this article, you'll learn what supply chain management is, why it's important, and how it works. You'll also explore jobs in the field, learn some of their salary expectations, and find suggested cost-effective courses that can help you get started today.

What is supply chain management?

Supply chain management refers to the coordination and oversight of various activities involved in the production, distribution, and delivery of goods or services from their source to the end consumer. This entails everything from sourcing the raw components for a product to delivering the final result directly to the consumer.

Part of working in supply chain management is figuring out how your company can maximize productivity, sustain production, grow within the market, and provide the most convenient experience for the customer.

Supply chain managers have two key responsibilities:

Ensure that customers can obtain products.

Ensure that the manufacturer can obtain the materials they need to create the product.

The consumer market can be competitive. So, it's important for businesses to make sure their products are in-stock when a consumer wants to purchase something. In addition, if a customer orders an item online and it takes a long time to arrive (or worse — it never arrives), they will be less likely to order from the same company again. 

To make sure that happens, supply chain professionals must source materials, locate manufacturing partners, coordinate delivery services, and offer convenient methods for returns. Having a supply chain that maximizes productivity and efficiency gives the company opportunities to expand and keeps revenue flowing.

Read more : A Look at Product Lifecycle: Management, Tools, Careers

Why is supply chain management important?

Effective supply chain management is important for all companies that distribute goods, services, and products because supply chains can quickly break down and delay production if not managed well. This creates internal stress in the company and a loss of revenue. It can also lead to detrimental customer loss and a lower company reputation. Certain suppliers and manufacturers are particular about the types of companies they work for, so having a solid company reputation with reliable key players will help to secure beneficial supply chain partners.

As a supply chain manager, you are one of the key people responsible for promoting business sustainability and positive experiences for customers. This is essential for the business's productivity and the company's success. Supply chain management plays a key role in staying on top of the market and sustaining a loyal customer base. According to a survey conducted by Deloitte, almost 80 percent of businesses with high-functioning supply chains performed better than their competitors [ 1 ]. 

How does supply chain management work?

Supply chain manager responsibilities typically include five critical areas of work: planning, sourcing, organizing, delivering, and managing. Each area has specific tasks for the supply manager.

1. Planning the supply chain network

Before solidifying any contracts with suppliers or putting the product on the market, you carefully plan each “link” in the chain. You want to ensure that the transition between steps will be seamless and that every stakeholder knows their responsibilities. Another aspect of this is efficiency. If one component of the supply chain lags behind the others, it creates a “kink” in the chain and slows the entire production. This can delay the product getting to consumers and create downstream difficulties in production.

2. Sourcing materials

The next component is sourcing the materials needed for the product or service. This involves determining the supplier, figuring out how much of the supply to order, keeping track of the supply, and paying the suppliers.

You also want to ensure your supplier meets the regulations needed to continue producing the product and ensure it is safe for the consumer. To keep product prices in the anticipated range, supply chain managers pay attention to any price changes and keep an eye on the pricing of alternative suppliers. 

3. Organizing manufacturers

The next step is to find the proper manufacturer for your product. This organization, company, or person turns the raw materials into the end product.

Supply chain managers arrange quality testing to ensure each product meets the expected standard, potentially from an outside organization. The manufacturer is in charge of packaging the products and handing them off to the delivery service. In this space, it’s essential to manage communications between material sourcing, manufacturing, and delivery. These three components need an established flow to keep production moving.

4. Delivery of the product

Next is managing the delivery of the product. Supply chain logistics are an essential consideration. Whether you deliver to retailers or the customers’ homes, the delivery service must be reliable and effective. Having damaged products, delayed delivery, or incorrect orders can damage the company's reputation and cause a loss of customers.

5. Managing return services

If a customer is unhappy with the product or would like to exchange it for an alternate one, it is essential to have an effective and convenient return service. This reduces product waste, as other customers can receive the returned items.

Learn more about the importance of supply chain management from experts at Rutgers:

Supply chain management jobs

The modern supply chain is a complex system composed of countless interconnected parts. To make sure it all goes off without a hitch, management professionals across the world perform a variety of logistics, planning, and buying duties. Here are some common jobs you can expect to encounter as you’re exploring a career in the field: 

Supply chain manager 

Logistics manager

Materials manager

Buyer planner

Sourcing manager

Master planner 

Master scheduler

Read more: Supply Chain Manager: What They Do and How to Become One

Supply chain management salary

Supply chain managers are essential to ensuring the timely operation of manufacturing and distribution processes around the world. And, they’re well rewarded for their efforts. According to the US Bureau of Labor Statistics (BLS), logisticians earn an average annual salary of $77,030. This is significantly higher than the median wage for all occupations in the country, which the BLS pegs at $45,760 as of May 2021 [ 2 ]. 

Supply chain management responsibilities

Supply chain managers have diverse responsibilities and a wide range of job duties. While the exact job description will vary depending on the company and type of industry in which you work, key elements of a supply chain manager career typically include:

Continually integrating new information and data into your company’s supply chain processes.

Managing communication between supply chain sectors

Protecting and managing supply chain data

Reducing human error with strategic planning

Planning for future obstacles and developing creating solutions

Provide accurate information to company employees

Reducing supply chain costs and maximizing revenue

Simplifying the supply chain as able

Integrating new technologies into supply chain functions

Supply chain management software

Supply chain managers use many types of software to manage different components of the supply chain and keep things running smoothly. In this career, you have the exciting task of finding new and useful technologies to help the company expand. As the product, market, or company grows, you can integrate more advanced software systems to keep track of large volumes of data. Building your technical skills can help you build the knowledge base to manage large projects and add value to your company team.

Automatic Requisition Tracking Management Information System (ARTMIS) is one such platform. Developed by IBM and Chemonics, ARTMIS is a common system that tracks shipments throughout the supply chain. This allows supply chain managers to schedule shipments up to two years in advance and promote long-term coordination of the supply chain elements. 

Another growing use case of supply chain management is integrating artificial intelligence (AI) and machine learning. Platforms such as BASF use these concepts to help supply chain managers make informed decisions, improve current systems, and track progress over time. 

As a society, we are in an exciting era of technological development. As your experience in supply chain management expands, you’ll quickly learn to use your creative and problem-solving skills to design innovative supply chain systems that use new technologies to improve function and efficiency. This creative thinking process serves to help you stay ahead of the competition and keep your organization at the top of the market.

Read more: Supply Chain Analytics: What It Is, Why It Matters, and More

Get started on your career

As the world becomes more interconnected, the need for supply chain management professionals grows even more. If you're interested in a career in supply chain management, consider taking an online specialization through Coursera to gain job-relevant skills today.

In Rutger's Supply Chain Management Specialization , you'll master the fundamentals of the profession, including logistics, operations, planning, sourcing, and strategy. By the end of the program, you'll not only have a certificate to put on your resume and job-relevant skills, but also a richer understanding of the complexities that companies are facing in today's global networked economy.

Article sources

Deloitte. “ Supply chain leadership Distinctive approaches to innovation, collaboration, and talent alignment, https://www2.deloitte.com/content/dam/Deloitte/us/Documents/process-and-operations/us-cons-supply-chain-leadership-report-040914.pdf.” Accessed April 27, 2023.

US Bureau of Labor Statistics. " Occupational Outlook Handbook: Logisticians , https://www.bls.gov/ooh/business-and-financial/logisticians.htm." Accessed April 27, 2023.

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This content has been made available for informational purposes only. Learners are advised to conduct additional research to ensure that courses and other credentials pursued meet their personal, professional, and financial goals.

Supply Chain Management 101: Principles, Examples, and Templates

By Andy Marker | June 25, 2017 (updated February 22, 2022)

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Globalization has become an undeniable part of commerce over the last few decades, as large companies have grown first to source labor and parts from developing regions, and then to start selling in those same areas as they grew in wealth and buying power. Supply chains have had to keep in step, passing through numerous countries to obtain goods most efficiently and cost effectively, and growing more complex as a result. And on the other end, the supply chain grows more frayed in order to deliver to countless countries for consumption. For the largest companies, managing a supply chain can require dedicated teams in every area the chain touches. It’s safe to say that supply chain management is both an art and a science.   This article will cover what a supply chain is, with examples; discuss how supply chain management works and its principles; and vital concepts in the field. Then we’ll move on to current issues and where the field is going. Finally, you’ll find useful resources, templates, and education programs. Ready? Let’s get started.

What Is a Supply Chain?

A supply chain is a collection of suppliers required to create one specific product for a company. The chain is made up of nodes or “links,” which can include multiple manufacturers for parts, then the completed product, then the warehouse where it is stored, then its distribution centers, and finally, the store where a consumer can purchase it. The concept of the chain is important, because each link is connected in a specific direction and order, and the next link cannot be reached without going through the previous one. Each link adds time and costs, and can involve labor, parts, and transportation. Every product a company carries may have its own supply chain, though they may use certain suppliers for multiple products. You can see why this gets so complicated, especially for international supply chains.

The process described above was that of a typical retail supply chain. However, there are many different types in practice. Here are three examples from well-known masters of supply chains:    Example: Walmart and “Big Box” Retailers The “Big Box” store, which represents one of the major disruptions of the retail model from the last century, thrives on size, ubiquity, and well-planned supply chains to drive out the competition. How else would a company like Walmart make a profit on a t-shirt made overseas that retails for $5.00?   Walmart succeeds by having fewer links in its supply chain, and buying more generic goods directly from manufacturers, rather than from suppliers with brand names and markup. It uses “Vendor Managed Inventory” to mandate that manufacturers are responsible for managing products in warehouses owned by Walmart. The company is also is particularly choosy with suppliers, partnering only with those who can meet the quantity and frequency it demands with low prices, and with locations that limit transportation needs. They manage their supply chain like one firm, with all partners operating on the same communication network.    By buying at large enough quantities to take advantage of economies of scale, moving products directly from manufacturers to warehouses, and then delivering to stores which are large enough to be distribution centers, it reduces links in the supply chain and cost per item, translating to low prices for consumers. 

Example: Amazon and “Ecommerce Platforms” Having overtaken Walmart as the world’s largest retailer in the last decade, Amazon’s “online big box” concept is a perfect example of unique supply chains. As an e-commerce shop, obviously they cut the retail store out and ship from distribution center to consumer’s homes directly. Where Amazon innovates is both in its supplier-side and its final supply chain link - delivery.    Just about anyone can sell things on Amazon because it’s a platform, not just a shop. As a result, Amazon has more things than any other online store, so when people shop online, they think of Amazon. Then, it produces everyday goods cheaply, and underbids suppliers. Next, their warehouses make serious use of automation to store items going to like destinations together, ready for immediate transport. Finally, its investments in delivery staff and technology make 2-day shipping a basic expectation, and even same-day delivery a possibility. Amazon ditches third-party logistics (3PL) and fulfills orders itself.

Example: Tesla and Specialized, Owned Chains Automotive manufacturing has come a long way since Henry Ford used assembly line manufacturing to speed up the production of a single car model in a single color. Now, in a time when even American carmakers are opening factories abroad, Tesla is making innovative, incredibly popular, and luxurious cars right in California, a location with incredibly costly real estate.   Rather than having a long supply chain of cheap part makers, they have a vertically integrated supply chain, with a full-service auto plant near its corporate headquarters and plans for a supplier park and a massive battery factory, and Tesla owns it all. Even more interesting is the digital supply chain the company promotes - new firmware and algorithm updates are pushed out to existing car owners over the cloud.

What Is Supply Chain Management?

As the name implies, supply chain management (SCM) is handling and optimizing all the many complicated facets of a supply chain, involving goods and services. Even ensuring timely handoff from manufacturer to shipper to supplier to shipper to buyer is a massive task, but to do it cost effectively and build net value is truly a challenge.    Supply chain management is so important because modern commerce exists in a networked global economy. Most businesses are specialized - even department and big box stores are only really equipped to sell to customers, despite their wide variety of products. The value of vertical integration is hard to justify when communication costs and SCM tools are so inexpensive - it almost always makes more sense to outsource for price efficiency.

The concept of supply chain management was in effect long before the term was created in 1982. In the colonial era, international trade by ship was already making for complicated transportation issues and the need for efficiency. During the Industrial Revolution, the ability to quickly produce goods with machine assistance led to the need to manage significant inventory and constant consumption. By the time history arrives at Henry Ford’s famous assembly line for the world’s first car production in 1913, supply chain management had become an art.    As the century wore on, more companies were producing more goods and looking for ways to reduce costs. They vertically integrated into owned supply chains to try reducing costs at each stage. In the 1980s and on, globalization became a realistic dream for many companies, because of computer systems, easier communication, and commerce-friendly trade laws. Around the 1990s, it became a common practice for firms to specialize, and focus on core competencies and outsourcing the rest, abandoning the vertical integration of the previous era. At this point, supply chains became truly complex, in order to coordinate hundreds of otherwise unrelated and geographically-distant manufacturers, suppliers, shippers, warehousers, and retailers.    Now, in the “SCM 2.0” era, the Internet and new methodologies have led to collaborative platforms and democratized processes. This is allowing smaller competitors to use some of the same manufacturers as major players, and reducing inefficiencies for those manufacturers as a  result. Better communication and planning tools are providing a way for small and large companies alike to manage even more complex supply chains.

Variants of SCM

Global SCM: The combination of global manufacturing with supply chain management, which must account for tariffs and local taxes as goods and services travel internationally to ultimately provide greater value at the end of the chain.   SAP SCM: Systems, Applications, and Products (SAP) is a software company that revolutionized logistics and enterprise resource planning. It provides an automated way to manage supply chain networking, supply chain planning, and supply chain execution, along with production planning, business forecasting, and demand planning.   Logistics and SCM: The art of coordinating efforts between every member of the supply chain to get products from their source to the consumer.    Purchasing and SCM: The focus on the monetary aspect of SCM, from costs to value added at each link in the supply chain.

Principles of Good Supply Chain Strategy

‌ Download Supply Chain Management Checklist

The Basics of Supply Chain Management Processes

There are key supply chain processes that you must take into consideration to effectively understand and manage them. These processes are all at play regardless of the type of supply chain you’re using.   Customer relationship management (CRM) comes first, because as the principles of SCM state, you must adapt everything in the supply chain to the customer. If no one is buying, there’s no need to produce anything. At the front of your supply chain, where a store’s staff interacts with its consumers, they must have plans in place for ongoing relationships. They need CRM tools to gather customer information for marketing and market research, all to determine the products and services to offer in the future.   Customer service management is another process that ties in, as it is where you gather negative and positive feedback to determine future needs.   Demand management is closely linked with the previous two, as it takes customer interactions and orders into account to determine the workload all the way up the supply chain. At its core, customers buying more means make more, and customers buying less means make less. Customer forecasting is an important task that analysts must perform well to determine the current demand and what it will be in the future, to prevent waste in the supply chain.   Product development is an important part of the supply chain that is informed by consumer demand. You must work with CRM and customer service data to determine what they want, which influences new products, product line extensions, and also what to stop making. You must integrate suppliers in this process because it affects cost, quality, and delivery time.   Supplier relationship management goes without saying - if you want to produce your products on time and on budget, you need a solid rapport with everyone you’re outsourcing to in the chain. This impacts manufacturing flow management , which ensures everything gets where it needs to go without delay, and at the correct spec.    Order fulfilment involves coordinating with distribution centers and either retail locations or 3PL to get the product direct to consumers. You’ve now made it all the way back to the beginning of the cycle, and need to pay attention to new CRM and customer service data.   Returns management , also known as the “reverse supply chain,” is a vital part of the flow of products that doesn’t fit perfectly into the clean supply chain cycle. It involves picking up online orders from 3PL locations or from consumers’ addresses and accepting returns at retail locations. Once these items are put back into inventory, they must be ready to get to a different customer while the product run is still live. 

What Supply Chain Managers Look for When Managing Supplier Relationships

One of the most complex parts of SCM is handling all the other people in the supply chain. They have their own needs and motivations, and to keep them all happy and working together with partners they are only loosely affiliated with is a challenge - especially when trying to meet deadlines and turn a profit. The following are what managers should focus on most in such relationships:   Org Chart and Leadership Style: How is the supplier’s organization set up? Is it a vertical or horizontal structure? Is the leadership strong and long lasting, or fickle and prone to change? You need to know who you’ll be interfacing with, and who will be the next one in line should some shakeup occur. Business relationships are always between people, and don’t always survive a reorg.    Management Style: How do the leaders at this supplier run their shop? Make sure it works with your crew. A micromanager at a relatively replaceable link in your supply chain will waste inordinate time, just as a hands-off manager at a vital link could result in sloppy delivery or substandard product quality.   Company Culture: Always important for working with suppliers, determine what kinds of people rise to the top, and how everyone acts when nobody's watching. If, for example, middle managers are constantly in fear for their jobs because of ruthless quarterly performance reviews, they may over-promise, make excuses, or otherwise be unstable work partners.    Product Flows: Once you know that you can work with the people, make sure their facilities are in order. Are they equipped for orders of the size and frequency you plan to make? How do they handle emergency, fast-turn around orders? What about other customers - are they only able to use their facilities for your product flows at certain portions of the month due to full inventory? Leave no stone unturned.   Information Flows: Just as vital is the ability to control information about the day-to-day flow of materials, and to communicate and coordinate long-term plans. Is the supplier up on their product details, inventory, and SKU organization? Is their security and encryption up to the standards of your company, and your industry? Big data is useless if the right people don’t see it in time.   Rewards and Risks: Take into account opportunities and threats of working with this supplier. Maybe they’re well-equipped to handle your exact product because they also work with your competitors. Perhaps they are new and establishing themselves, so offer a substantial discount, but may not be able to deliver on time? Do what’s best for the company, and use risk assessment to keep your whole supply chain operable.

Vital Supply Chain Management Concepts to Know

Having a passing familiarity with the following terms will help you see just what kind of skillset and abilities will be required when working in supply chain management:   Border Adjustment Tax: Also known as a destination-based cash flow tax (DBCFT), it is a tax levied on imported goods which is important to know in global supply chains.   Customer Relationship Management: Also known as CRM, this concept refers to providing ongoing service to customers and collecting data about their likes and purchases. There are also CRM tools that help automate and record interactions with customers.   Cumulative Mean: A figure for knowing how much or how little to produce in advance, involving mean orders with all previous data treated as equally useful.   Demand Management: Understanding customer behavior and patterns to control how much is ordered and produced at each link in the supply chain, with the goal of eliminating wasted production.   Financial Flows: Credit terms, payment schedules, accounts payable and receivable, and other factors that you must monitor to determine if a supply chain is profitable or not.   Information Flows: Transmission of orders, delivery status, and other data that influence the supply chain’s responsiveness to demand.   Integrated SCM: This is a method of SCM wherein all of the links are tightly integrated, operating almost as one company rather than a loose association of buyers and sellers.   Inventory Management: Monitoring and controlling orders, storage, and use of owned components to create the products your company sells.   Lean Six Sigma: A data-backed philosophy of continuous improvement that focuses on preventing defects and mistakes rather than discovering them later, which reduces waste and production time via standardization. Read Everything You Need to Know About Lean Six Sigma to learn more about this methodology.    Logistics: The physical movement of products from one link in the supply chain to the next, and the practice of improving their efficiency.   Make vs. Buy: A simple evaluation of whether it is more cost-effective and time-efficient to produce a required product with your company’s existing resources, or to outsource the need.   New Product Development: The creation of new products both in response to and in anticipation of customer demand, using data gleaned from CRM and the whole supply chain. Read Innovation for Everyone: Everything You Need to Know About New Product Development to learn more about this process.   Operational Accounting: Accounting for a company that focuses on planning, directing, and controlling of daily activities by their costs and eliminating waste.   Physical Flows: The actual movement of parts and products throughout the supply chain, which the Logistics team must manage and analyze to keep going without pause.   Project Management: The process and tools involved in ensuring that a codified piece of work (project or product) gets done on time while keeping all contributors aware of their next step.   Reverse Supply Chain: Aftermarket customer service, which may involve accepting returns, refurbishing and discounting, or otherwise finding use for the reacquired inventory.   Risk Management: Identifying, evaluating, and then choosing which risks to address first, with the goal of reducing overall risk in a supply chain.   S&OP: Sales and Operations Planning is a management process that aligns its constituent parts to ensure that the organization is only focused on operations that improve sales. Learn more about S&OP here .   Strategic Sourcing: Formalizing a company’s information gathering in order to use its purchasing power to take advantage of the best values in the marketplace of suppliers.   Theory of Constraints: A methodology that identifies the largest limiting factor in production, then finding a way to remove it to improve the efficiency of the entire production.

Current Issues in SCM

In addition to the major terms, it’s important to keep aware of legal, political, and social events which affect supply chain management when seeking a career in the field. Here are some of the bigger issues of the day:   Dodd-Frank Decision: This was a 2010 law which included a clause on “Conflict Minerals.” It requires companies to audit their supply chains in order to determine whether gold, tungsten, tantalum, and tin came from the Democratic Republic of the Congo, and report on their due diligence. It adds an extra layer of complexity and costs to SCM for those involved in chains with those minerals.   NGO Actions: Activist groups of all kinds work to end common practices within major companies’ supply chains, such as sweatshop labor, or push consumers towards less complicated supply chains by encouraging them to support local businesses and farms.    SEC Regulations: Whereas NGO actions can force a company’s hand for PR reasons or changing the marketplace of ideas, the Securities and Exchange Commission can slap that same company with fines, making company’s quick to comply. Third-party audits of supply chains are an important part of keeping in step with these regulations.    SECH Ratings: This is a rating that involves economic, social, and environmental judgements to gauge a company’s overall sustainability.   Transparency: Though protecting data is important, certain measures of transparency can improve company performance. Among consumer products, many younger, disruptive brands make their supply chain a selling point in marketing by being upfront about how and where they get their components, and where they make their products. The reasoning goes, if a company is hiding something, there must be an unethical component to it.   Sustainability Measures: As major companies and countries around the globe move towards sustainable production, all supply chains become impacted. Whether due to changing regulations or seeking good PR, many companies are working to reduce pollution and other issues in their chain.

The Future of Supply Chain Management

Aside from the issues of the day, it’s also vital to see where the field is going. The future of SCM is bright, but certainly evolving. We asked a group of experts and innovators in supply chain management to discuss what they believe the future of SCM holds: ​

Jake Rheude , Director of Business Development and Marketing for Red Stag Fulfilment

Over the next decade, we will see massive and disruptive forms of innovation both in terms of technology that expedites the speed at which customers receive their products ( drone delivery ) as well as technologies that drastically enhances the online shopping experience for customers, ( virtual reality ).

While these and other technologies no doubt have the opportunity to significantly change the landscape of online shopping and the supply chain, I expect we will see firms diverge on two different strategies. Some will rush to implement these costly new technologies in order to drive down the total time between an order being placed and last mile delivery, while other firms will stand by the current landscape (for most B2C online sellers) of product delivery in approximately two-days, acting cautiously, particularly in regards to the cost of these new technologies versus their impact on the overall value chain for consumers.

Certainly, there are niche industries where significant investments in drone delivery technology will provide a distinct competitive advantage, but I predict that for many B2C online sellers, the impact on the overall value chain of these new technologies will be misaligned with a consumer's perception of value, and therefore make the initial cost of these new technologies unjustified.

Lauren Stafford , Digital Publishing Specialist for Explore WMS

Embracing big data is an essential principle of modern SCM, specifically real-time data which has the potential to improve the efficiency of a supply chain and negate potential risks to strategy. We know that logistics optimization through technological innovations and data integration can make supply chains more efficient and more financially sound.

The future of the multi-modal SCM depends on successful integration with data and systems to achieve synchromodality. To achieve this, there needs to be a connection to all available transport modalities in the form of a real-time data flow. Once any issues with connectivity are addressed, a ranking system is required to consider a variety of variables such as dock schedules and material restrictions. Pricing data is another integral component.

The great advantage of a synchromodal platform is that it’s informed by every available option and makes a selection based on key factors like speed requirements. There is still significant work to be done in terms of how best to access and integrate a supply chain partner’s real-time data but, as these platforms are developed, we’re likely to see faster order processing times for large shipments and systems which can help generate a better ROI. The way we understand it, SCM is changing because now an efficient supply chain can be a competitive asset as opposed to a cost center.

John Boyd , founder of The Boyd Company, Inc

Probably the most dynamic link in the supply chain in recent years has been the "last mile": that movement of goods from a DC to a final destination in the home. E-commerce king Amazon has done much to challenge and ultimately rewrite the rules of last mile delivery. Last mile delivery has also produced a new warehousing subsector: the locker. Studies show that online shoppers not only want their packages now, they also want their packages delivered to places other than their homes. These lockers can be viewed as "micro warehouses" and will come with additional costs. We expect many to be operated by an emerging sector of third-party logistics (3PL) providers specializing in this particular segment of the supply chain.

Lockers are now common in Europe, where densely populated and congested urban centers make them a natural fit. We anticipate that lockers will also become the next boom sector within logistics/distribution site selection in the United States. Amazon already has automated lockers in six states, while the U.S. Postal Service has lockers located within post offices in the Washington, D.C., area.

Upstart third-party logistics providers will be looking for sites where they can locate lockers, such as in transit centers, apartment buildings, convenience stores, or any establishment that provides off-hours access for picking up packages. Also, the growing online meals industry is expected to fuel the need for temperature-controlled lockers for the delivery of perishables.

Careers in Supply Chain Management

With a bright future filled with unique challenges, a career in SCM is a strong choice. It might be surprising to hear about an industry that’s all about outsourcing and automation, but new experts are more vital than ever for global organizations and even local ones to grow. Look at these industry stats:

Career Paths

What kind of positions can you take on in supply chain management?   Supply Chain Business Analyst: Examine your company’s workflow and come up with creative ways to streamline its business processes. Live and breathe efficiency.   Inventory Control Administrator: Ensure that inventory systems’ data is accurate with physical inventory, troubleshoot discrepancies, discover root causes and interact with everyone related to this inventory.    Purchasing Specialist: Work out deals with suppliers and compare bids to minimize cost across the supply chain.   Procurement Manager: Research, evaluate, and purchase large quantities of products for companies to resell or use in operations. Determine what is in your company’s store, ecommerce shops, and more.    Operations Analyst: Evaluate, report on, and improve the management of activities that generate recurring revenue for your organization, i.e. its core competencies.   Material Planning Manager: Plan, monitor, and manage products and the materials required to make them in your organization’s manufacturing operations. You ensure the constant flow of materials so the factory never runs out. 

Logistics Analyst: Evaluate and report on transportation of goods and services up and down your organization’s supply chain, ensuring that everything gets where it needs to go and when it needs to get there.

Top Higher Education Programs

Supply chain management is a game with global stakes, as such major universities and academies around the world offer Bachelor’s and Master’s degrees in the subject. If you want to secure a job in the sector with a Fortune 500, becoming accredited in SCM is vital. Look at some of the top schools on this list for more details on breaking into the industry:

• Cambridge University
• Copenhagen Business School
• Cranfield School of Management
• Eindhoven University of Technology
• London Business School
• Vlerick Business School

Certifications in Supply Chain Management

If a full Master’s program seems like too big a commitment, explore some of the short-term certifications available below. They give you a shot at entry level jobs if you’re inexperienced, and are a nice brush-up on current SCM standards for seasoned professionals.

• Chartered Institute of Supply Chain Management (CISCM) Chartered Supply Chain Management Professionals (CSCMP)
• Institute for Supply Management (ISM) Certified Professional in Supply Management (CPSM)
• Institute of Supply Chain Management (IOSCM)
• International Institute for Procurement and Market Research (IIPMR) Certified Supply Chain Specialist (CSCS) , Certified Procurement Professional (CPP) and Certified Supply Chain Associate (CSCA)
• International Supply Chain Education Alliance (ISCEA) Certified Demand Driven Planner (CDDP) and Certified Supply Chain Manager (CSCM)
• Association (SCMA) Supply Chain Management Professional (SCMP)
• The Association for Operations Management (APICS) Certified Supply Chain Professional (CSCP) and Certified Production and Inventory Management (CPIM)

Supply Chain Management Templates

Outside of the physical work of checking inventory, or the personal work of communicating with different members of the supply chain’s links, much of your work as a supply chain manager is using systems and dashboards to get an understanding of logistics, operations, and flows. What follows are some templates that can help manage and streamline workflow, while understanding and sharing inventory reports and more.

Download Risk Management Matrix Template

Excel  |  Word  |  PDF  |  Smartsheet

Download Stock Inventory Control Template

Excel  |  Smartsheet

‌ Download Supply Chain Dashboard Template

‌ Download Microsoft Excel Template for Choosing MRP Software

‌ Download RFP Vendor Template

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• How SCM Works

5 Phases of Supply Chain Management

Types of supply chain models, example of scm, the bottom line.

• Supply Chain

Supply Chain Management (SCM): How It Works & Why It's Important

What Is Supply Chain Management (SCM)?

Supply chain management (SCM) is the process of managing the flow of goods and services to and from a business, including every step involved in turning raw materials and components into final products and getting them to the ultimate customer. Effective SCM can help streamline a company's activities to eliminate waste, maximize customer value, and gain a competitive advantage in the marketplace.

Key Takeaways

• Supply chain management (SCM) is the centralized management of the flow of goods and services to and from a company and includes all of the processes involved in transforming raw materials and components into final products.
• By managing the supply chain, companies can cut excess costs and deliver products to the consumer faster and more efficiently.
• Good supply chain management can help prevent expensive product recalls and lawsuits as well as bad publicity. 
• The five most critical phases of SCM are planning, sourcing, production, distribution, and returns.
• A supply chain manager is tasked with controlling and reducing costs and avoiding supply shortages.

Investopedia / Alex Dos Diaz

How Supply Chain Management Works

Supply chain management represents an ongoing effort by companies to make their supply chains as efficient and economical as possible.

Typically, SCM attempts to centrally control or link the production, shipment, and distribution of a product . By managing the supply chain, companies can cut excess costs and needless steps and deliver products to the consumer faster. This is done by keeping tighter control of internal inventories , internal production, distribution , sales, and the inventories of company vendors.

SCM is based on the idea that nearly every product that comes to market does so as the result of efforts by multiple organizations that make up a supply chain. Although supply chains have existed for ages, most companies have only recently paid attention to them as a value-add to their operations.

A supply chain manager's job is not only about traditional logistics and purchasing but finding ways to increase efficiency and keep costs down while also avoiding shortages and preparing for unexpected contingencies. Typically, the SCM process consists of these five phases:

To get the best results from SCM, the process usually begins with planning to match supply with customer and manufacturing demands. Companies must try to predict what their future needs will be and act accordingly. This will take into account the raw materials or components needed during each stage of manufacturing, equipment capacity and limitations, and staffing needs. Large businesses often rely on enterprise resource planning (ERP) software to help coordinate the process.

Effective SCM processes rely very heavily on strong relationships with suppliers. Sourcing entails working with vendors to supply the materials needed throughout the manufacturing process. Different industries will have different sourcing requirements, but in general, SCM sourcing involves ensuring that:

• The raw materials or components meet the manufacturing specifications needed for the production of the goods.
• The prices paid the vendor are in line with market expectations.
• The vendor has the flexibility to deliver emergency materials due to unforeseen events.
• The vendor has a proven record of delivering goods on time and of good quality.

Supply chain management is especially critical when manufacturers are working with perishable goods. When sourcing goods, companies should be mindful of lead times and how well equipped a supplier is to meet their needs.

Manufacturing

This is the heart of the supply chain management process, where the company uses its machinery and labor to transform the raw materials or components it has received from its suppliers into something new. This final product is the ultimate goal of the manufacturing process, though it is not the final stage of supply chain management.

The manufacturing process may be further divided into sub-tasks such as assembly, testing, inspection, and packaging. During the manufacturing process, companies must be mindful of waste or other factors that may cause deviations from their original plans. For example, if a company is using more raw materials than planned and sourced for due to inadequate employee training, it must rectify the issue or revisit the earlier stages in SCM.

Once products are made and sales are finalized, a company must get those products into the hands of its customers. A company with effective SCM will have robust logistic capabilities and delivery channels to ensure timely, safe, and inexpensive delivery of its products.

This includes having a backup or diversified distribution methods should one method of transportation temporarily be unusable. For example, how might a company's delivery process be impacted by record snowfall in distribution center areas?

The supply chain management process concludes with support for the product and customer returns. It's bad enough when a customer needs to return a product, but even worse if that's due to an error on the company's part. This return process is often called reverse logistics, and the company must ensure it has the capabilities to receive returned products and correctly assign refunds for them. Whether a company is conducting a product recall or a customer is simply not satisfied with the product, the transaction with the customer must be remedied.

Returns can also be a valuable form of feedback, helping the company to identify defective or poorly designed products and to make whatever changes are necessary. But without addressing the underlying cause of a customer return, the supply chain management process will have failed, and future returns will likely persist.

Supply chain management does not look the same for all companies. Each business has its own goals, constraints, and strengths that will shape its SCM process. These are some of the models a company can adopt to guide its supply chain management efforts.

• Continuous flow model: One of the more traditional supply chain methods, this model is often best for mature industries. The continuous flow model relies on a manufacturer producing the same good over and over and expecting customer demand will show little variation.
• Agile model: This model is best for companies with unpredictable demand or custom-order products. This model prioritizes flexibility, as a company may have a specific need at any given moment and must be prepared to pivot accordingly.
• Fast model: This model emphasizes the quick turnover of a product with a short life cycle. Using a fast chain model, a company strives to capitalize on a trend, quickly produce goods, and ensure the product is fully sold before the trend ends.
• Flexible model: The flexible model works best for companies affected by seasonality . Some companies may have much higher demand requirements during peak season and low volume requirements in others. A flexible model of supply chain management ensures that production can easily be ramped up or wound down.
• Efficient model: For companies competing in industries with very tight profit margins, a company may strive to get an advantage by making its supply chain management process the most efficient. This includes utilizing equipment and machinery in the most ideal ways in addition to managing inventory and processing orders most efficiently.
• Custom model: If any model above doesn't suit a company's needs, it can always turn toward a custom model. This is often the case for highly specialized industries with high technical requirements, such as an automobile manufacturer.

Understanding the importance of SCM to its business, Walgreens Boots Alliance Inc. decided to transform its supply chain by investing in technology to streamline the entire process. That included using big data , collected from its 9,000 stores and 20,000 suppliers, to help improve its forecasting capabilities and better manage sales and inventory. In 2019 it appointed its first-ever chief supply chain officer, a key leadership role in the company.

The company has also incorporated supply chain management into its environmental, social, and governance (ESG) initiatives, including those involving human rights, animal testing, sustainability, and transparency regarding product ingredients.

Why Is Supply Chain Management Important?

Supply chain management is important because it can help achieve several business objectives. For instance, controlling manufacturing processes can improve product quality, reducing the risk of recalls and lawsuits while helping to build a strong consumer brand. At the same time, control over shipping procedures can improve customer service by avoiding costly shortages or periods of inventory oversupply. Overall, supply chain management provides multiple opportunities for companies to improve their profit margins and is especially important for businesses with large and international operations.

How Are Ethics and Supply Chain Management Related?

Ethics has become an increasingly important aspect of supply chain management, so much so that a set of principles called supply chain ethics was born. Many investors today want to know how companies produce their products, treat their workforce, and protect the environment. As a result, companies respond by instituting measures to reduce waste, improve working conditions, and lessen their impact on the environment—all of which can involve SCM.

How Much Do Supply Chain Management Jobs Pay?

Supply chain managers across the United States had average annual salaries in the range of $109,645 to $140,513 as of December 2023, according to the website Salary.com.

A supply chain starts with the ordering of raw materials or components from a supplier and ends with the delivery of a finished product or service to the end consumer. In supply chain management, every link in that chain may offer an opportunity to add value or reduce inefficiency. A well-run SCM program can increase a company's revenues, decrease its costs, and bolster its bottom line .

Cision PR Newswire. " Walgreens Transforms Supply Chain Management with Kyvos, Tableau, and Big Data ."

Walgreens Boots Alliance. " Walgreens Boots Alliance Announces Key Leadership Appointments Live ."

Walgreens Boots Alliance. " Environmental, Social & Governance. "

Salary.com. " Supply Chain Manager Salary in the United States ."

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Strategic Goals and Objectives in Supply Chain Management

9/14/21 10:30 AM

By PlanetTogether

Supply chain management is what makes the world go round. It is how we get our products from their raw materials, transformed into their final form, and ultimately delivered to end consumers.

What is Supply Chain Management?

Supply chain management can be defined as the management of the set of processes that move materials and products through the supply chain, from the suppliers to the end consumers. These processes ensure that goods arrive in the right quantity and at the right time to fulfill customer orders and meet their expectations. 

The Importance of Supply Chain Management

A well-managed supply chain will is essential for any manufacturing organization that is looking to maximize its profits and reduce any disruptions. 

If you are looking to improve your operations and implement supply chain management strategies, it is important to explore some of the main goals of supply chain management. These strategic goals include ensuring efficiency, improving quality, and optimizing transportation. These goals will help you reduce costs, increase efficiency and profits, and can even help you gain a competitive advantage within your industry. You will be able to meet your customer’s needs and foster brand loyalty among them.

Within this blog, we will discuss these strategic goals and objectives and how they can benefit your overall production facility and operations to ultimately enable you to reduce costs and increase profits. 

Top Three Strategic Goals and Objectives of Supply Chain Management  

The top three strategic goals and objectives of supply chain management include the following: 

• Ensuring Efficiency - For obvious reasons, efficiency is one of the most important aspects of supply chain management. In manufacturing, efficiency is defined by the ability to fulfill customer orders in a timely manner while using the least amount of inventory or WIP. While operational efficiency is essential, efficiency between links in the supply chain is also important. Effectively managing inventory, transportation, and logistics can be a complex process; especially for companies who do not have an adequate ERP, MRP, or APS system. However, the collaboration between manufacturers, wholesalers, and retailers is essential to maximize the efficiency of your operations. Manufacturers should focus on increasing the visibility within their operations as well as with their suppliers and other retailers to improve the efficiency of the entire supply chain. 
• Optimizing Transportation and Logistics - Another key component within supply chain management is optimizing transportation and logistics. Within an independent business environment, each company is responsible for its role in ordering, shipping, and transportation of goods. In this business model, the cost are rather high due to poor timing and collaboration. With supply chain management, your process should “flow” and have your suppliers, manufacturers, wholesalers, and retailers all on the same page at all times. Visibility is extremely important to achieve this goal of supply chain management. This will allow you to plan optimized transportation and logistics activities with any vendors or buyers you work with. Having visibility within your own operations will allow you to determine when you will need to purchase additional material and when your products are to be completed and able to ship to retailers.
• Focusing on Quality Improvemen t - As stated above, the main goal of the supply chain is to produce products and deliver them to customers. It is important to keep in mind that the goal is not only to provide consumers with a product but to provide them with the absolute best value possible. This goal should be shared by you and your supply chain partners. It is impossible to produce a product of high quality while using low-quality materials and parts. As you work to be more connected with your supply chain partners, the quality of your products and services should improve dramatically. Another important aspect to consider is that value and quality are determined by the customer. They are the ones that decide which items they want to buy and most consumers are willing to pay more money for items that they judge are of better quality. Manufacturers should collaborate with their customers to identify their main needs and figure out how to create products that will be of value to them. Any inefficiencies or drawbacks of your products will be identified and will offer you an opportunity to correct and improve your products. This information should also be shared with all partners along the supply chain to ensure that all are working towards a common goal.

There are a multitude of benefits that come with incorporating supply chain management goals and objectives into your own business objectives. Supply chain management will dramatically reduce costs by improving operations, managing inventory, and reducing disruptions. It is important to consider that even a small reduction in production or storage cost can lead to big savings in the long run. 

An Advanced Planning and Scheduling (APS) software can help with your supply chain management needs by increasing visibility within your production operations. Systems such as PlanetTogether APS can help you identify production bottlenecks and other areas that are in need of efficiency enhancements. Not only will this system help you reduce your operational costs, but it will also ensure that you are adequately managing your inventory. This will help you foster good relationships along the supply chain, from your suppliers who receive enough notice for materials, to your customers who are able to get their items in a timely manner. Manufacturing facilities around the globe are reaping the benefits of using advanced planning and scheduling systems like PlanetTogether. 

Our production plant is faster and more efficient, which keeps our facility in better spirits and running smoothly. GREGORY VAN LEIRSBURG, PRODUCTION SCHEDULER, STANDARD PROCESS SUPPLEMENTS  

Advanced Planning and Scheduling (APS) Software

Advanced Planning and Scheduling Softwares have become a must for modern-day manufacturing operations as customer demand for increased product assortment, fast delivery, and downward cost pressures become prevalent. These systems help planners save time while providing greater agility in updating ever-changing priorities, production schedules, and inventory plans. APS Systems can be quickly integrated with an ERP/MRP software to fill the gaps where these systems lack planning and scheduling flexibility, accuracy, and efficiency.

With PlanetTogether APS you can:

• Create optimized schedules that balance production efficiency and delivery performance
• Maximize throughput on bottleneck resources to increase revenue
• Synchronize supply with demand to reduce inventories
• Provide company-wide visibility to resource capacity
• Enable scenario data-driven decision making

The implementation of an Advanced Planning and Scheduling (APS) Software will take your manufacturing operations to the next level of production efficiency by taking advantage of the operational data you already possess in your ERP system. APS is a step in the right direction of efficiency and lean manufacturing production enhancement. Try out a free trial or demo !

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ESSAY; Moscow's China Card

By William Safire

• Sept. 8, 1986

Every decade or so, China undergoes a political convulsion. In 1948-49, the Communists threw out the Kuomintang; in 1956, Mao's ''Great Leap Forward'' plunged the country into a depression; in 1966, the Cultural Revolution to purify the party brought on a new Dark Ages; in 1976-78, we saw Mao's would-be radical successors, the ''Gang of Four,'' replaced by pragmatic Deng Xiaoping.

Now we are celebrating the 10th anniversary of the death of Mao, and some Pekingologists would have us believe that this decade's upheaval will not come.

Mr. Deng, at 82, has provided for his succession, we are assured: it's all set for Hu Yaobang and Zhao Ziyang to succeed him, with Hu Qili of the next generation right behind. Not to worry, goes the current Edgar Snow-job: China's new era of ''commutalism,'' communism with a capitalist face, will march undisturbed into the next millennium.

I wonder. Maybe the conventional wisdom will prove right for once. But for argument's sake, let's look at what is happening in China through a different set of glasses, seeking truth from facts.

Fact number one is that a wave of materialism is sweeping across the billion people of China. After a generation of repression, good ol' greed is back in the saddle, and an I'm-all right-Deng attitude permeates the new entrepreneurs.

As a longtime expositor of the virtue of greed in powering the engine of social progress, I cannot cluck-cluck at this. But there is a difference between the materialism of the Chinese on Taiwan, who are accustomed to free enterprise, and the lust for the good life of available goods on the mainland, where a terrible thirst has been a-building.

Let us assume that the outburst of materialism in China leads to some reaction: that some spoilsport faction emerges to summon up the ghost of Mao's ideological purity, and that this new gang of fortyish Outs finds its way back in. It is at least a possibility.

I think that shrewd old Deng is well aware of this possibility. That is why, despite his ostentatious rejection of personal cultdom, he is preparing his most dramatic assault on the memory of Mao. That father of the revolution startled the world by breaking with the Soviet Union; Mr. Deng, playing a revisionist Lenin to Mao's Marx, wants to startle the world and overwhelm internal opposition by a rapprochement with Moscow.

Accordingly, fact two: He has abandoned his demand that Russia move back its huge army from the Chinese border, thereby double-crossing his own Army leaders. He has forgotten his requirement that Soviet forces be withdrawn from Afghanistan, thereby double-crossing his Westernish ally, Pakistan.

All Mr. Deng now asks of the Russians is that they try to squeeze their Vietnamese clients to pull out of Cambodia. Of course they'll try - ''best efforts'' is an easy promise - and since the Vietnamese are notoriously independent, Moscow cannot be blamed for not succeeding. Result: Mr. Deng takes the salute from atop the wall in Red Square.

That reestablishes his Communist credentials, defanging hard-left opposition at home. And it is Middle Kingdom orthodoxy; I suspect Chinese agents in the U.S. supply the K.G.B. with intelligence, just as Peking permits our Big Ears on its soil to overhear Kremlin transmissions. Chinese policy has always been to play the barbarians against each other.

This theory would also explain fact three: Mr. Gorbachev's seizure of a U.S. newsman as hostage. It is no coincidence that this particular hostage selection follows China's arrest and expulsion of a reporter for a U.S. newspaper. The Soviet leader, advised by Anatoly Dobrynin, must have known that this slap in the face would jeopardize a summit - and went ahead with his calculated humiliation, similar to Mr. Nixon's mining of Haiphong harbor before his Moscow summit in 1972.

Because the Russians now have the prospect of a pilgrimage to Moscow by Mr. Deng, they can taunt the U.S. President with impunity. As Mr. Dobrynin probably predicted, Mr. Reagan is reduced to begging for the hostage's release, in effect volunteering testimony to a Soviet court, in his eagerness to crown his Presidency with a peacemaking summit.

Now Mr. Gorbachev can hang tough, holding a show trial and thereby delaying negotiations with the U.S. until the Deng visit - or can graciously accede to the Reagan plea, thereby establishing his dominance. And the overconfident Mr. Reagan never suspected, as he sat down to summit poker, that this time the China card was in his opponent's hand.

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Transforming drawings into hoisting equipment / eot-crane systems..

In our dedicated factory’s, designed to produce in an efficient workflow, our high quality and reliable Hoisting Equipment / EOT-Crane Systems. We as Lemmens Crane Systems having the following production options:

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LEMMENS CRANE SYSTEMS ISO CERTIFIED SINCE 1994.

We produce our wide range of lifting solutions according to agreed drawings and valid regulations because industrial lifting equipment is qualified according their definition as a dangerous equipment/tool. Dangerous tools need to be produced according to regulations with dedicated testing and certification procedures. The returning basic part from our products is the BOX-Girder, who will be produced according the established and proven technology from Lemmens Crane Systems based on STRESS FREE welding and using the welding heat input to bring the girder into the required shape, ready for his long lasting task.

Girder plate assembly – Welding – End carriages production – walkways – Bridge assembly, YES including wheel alignments. Mechanical Assembly of the crane bridge. Hoist-Crab assembly and installation on the crane bridge (Marriage). Electrical Assembly of the Hoisting Equipment / EOT-Crane System. Disassembly for sandblasting and painting. Re-Assembly from the EP-End Product ready for FAT, Factory Acceptance Test, hopefully together with our customer. Again disassembly into transport possible pieces, to be ready to load on trucks or into containers.

Engineering ISO Functionality

L.Supply Management

H. product management, n. dispatch, h. planning.

• Purchase requisition
• Packing list/freight bills
• Order request
• Approved packing list
• Release materials in supply
• Differing deliveries

Functionality

Supply Management is responsible for registering, identification and control of the supply of articles and parts.

Receipt of material, unloading and checking material against the packing list will be handled by store keeper. They will check if the materials have been delivered in accordance with agreement as per PO. Furthermore, upon delivery the packing list will be checked against the purchase order with the specified material. If required, the delivery should include a Certificate or an additional quality control check should be executed by a certified employee. After approval the material received material entry should be made against project, if necessary, reported to Planning and Production.

For service department: Supply management is also responsible for managing and identifying of all supplies on the premises and the spare parts received from customers for repair and/or hoisting equipment for testing. Standard supply parts/materials will be supplemented periodically through order suggestion to Purchasing.

If Wrong receipt material are found the materials concerned will be blocked and not released for production. Differing deliveries concerning purchased materials and parts will be referred to Purchasing. Differing deliveries concerning work contracted out will be referred to Work Planning, after which the necessary and corrective measurements will be taken.

If Wrong receipt material will be registered on a RTV-form (Return to Vendor form). If a delivery is incorrect, the goods will be returned to the supplier or recovered by the supplier together with a return voucher.

L.01 Stock Management L.02 Receipt of Materials L.03 Materials supplied by customer

• Production planning
• Detailed drawings
• Cutting list
• Installation schedule
• Progress report
• Registration of work hours / time sheet

Functionality Product Management executes projects in the workshop, in accordance with the planning. Using the available materials, people and means, they execute the planned projects quickly and efficiently by means of work orders.

Product Management will receive the standard work file from Planning, which contains all important detailed drawings and material specifications. They are responsible for executing the planned work as agreed and for registering all details on the required forms and documents. The necessary materials and parts will be supplied per project by Supply Management.

After completion of every work phase, a check will take place confirm the Quality plan, making use of the appropriate checklists. Work Planning will give support in order to find solutions when technical difficulties occur and will decide which changes should be made. Technical changes will be noted down on the work drawings by production staff and later accounted by the Drawing Office. The project parts will be released for assembly based on inspections using checklists and documents. Differentiation in the planning will be reported to Planning. Details with regard operating times and presence and absence will be recorded for work administration and project progress.

If a calamity or work accident occur during the work performance the First Aid Trained employee will be called in immediately. He/she will take charge until a stable situation has been realised or until an external rescue team has arrived. The accident will be recorded in the accident registration file and given to the Quality Coordinator.

Also, everyone is responsible for the separate collection of the released waste produce and to take care of disposal in accordance with the legislation in force.

M.01  Production Management Mechanical/Electric M.02 Temporary checks M.03 Release workshop M.04 Internal Calamities M.05 Waste M.06 Workshop Repair

• Delivery order
• Identification
• Delivery note
• Freight bill
• Dispatch papers

The functionality Dispatch is responsible for adequate and timely transport of purchased, produced or repaired parts to the location of the client. All parts of the projects are wrapped and placed ready, in accordance with Planning, to be sent on time to the project location (possibly for assembly or service and maintenance).

Dispatch will receive notification from Planning Purchase in advance 3days when specialised transport is being hired. After loading the cargo, Dispatch will take care that the correct transport documents are made available for national and international transport. Then will send confirmation to all departments for despatch.

Materials returned after delivery of finished projects will be received by dispatch and concluded. Useful materials etc. will be recorded and delivered to supply. For records pictures of despatch materials with mode transport may be keep in server. Useless materials (e.g. because of large deliveries) will be, after consideration, removed in waste containers or returned to suppliers or will go to supply.

N.01  Prepare for Transport N.02 Return Materials N.03 Prepare for Dispatch Documents

• Order details
• Delivery details
• Progress information
• Order documents
• Delivery times
• Proforma invoice

As soon as an order has been made and been confirmed, the General Manager will receive all details regarding this order. He decides who will perform as project leader for that project. The project will then go to the indicated project leader. He will study the project and discuss with Sales if there are any obstructions. If the project is clear, it will go to planning and they decide, with regard the post-calculation details, personnel and specifications of the customer as mentioned in the order file, planning and execution of the order. Project details will be entered into the planning module. The project leader, together with planning, will direct the draftsmen to prepare a draft for approval. Also, the project leader will, together with the purchase clerk, decide which are the critical purchase parts of the order, after which Purchasing can be directed for the purchase. After the client’s approval of the draft the drawings with specifications will be sent to Work Planning.

The Planner will subsequently prepare a weekly planning for the function Production Direction, who will be entrusted with the execution and follow-up of the time planning of the various projects in the workshop. In case of delay or speeding up in the process of production the project planning will be adjusted after consultation with the project leader. The project leader will direct the functionality Invoicing to prepare (part) invoices on time.

Pre-fabricated parts will be prepared for transport, after testing and inspection, to the location of assembly. Dispatch will be directed together with the project leader, after which the assembly can be planned. When the work and the test procedures are finished the delivery can be planned by the Project leader.

All project details will be archived and managed after the project is finished.

H.01  Project planning H.02 Weekly planning H.03 Project process and Shipment H.04 After sales planning H.05 Periodic inspection of hoisting devices

Apple cuts greenhouse gas emissions in half

Paving the Way for Recycled Critical Materials

Slashing Manufacturing Emissions with Suppliers

Designing to Remove Plastic

Partnering with Communities to Drive Change

Spurring Industrywide Change with Reusable Filters

Innovating for the Future of Recycling

Building for a Greener Future

Investing in Nature with High-Quality Carbon Removal Projects

Engaging Customers and Employees in Global Recycling

Celebrating Earth Day with Education and Action 

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April 18, 2024

Innovations in clean energy, materials, and recycling are driving progress toward Apple’s ambitious environmental goals

Apple has reduced its overall greenhouse gas emissions by more than 55 percent since 2015, the company shared today in its 2024 Environmental Progress Report . The milestone marks important progress on the journey toward Apple 2030, the company’s ambitious goal to become carbon neutral across its entire value chain by the end of this decade. The goal centers on cutting emissions by 75 percent from 2015 levels.

“The proof of Apple’s commitment to climate action is in our progress: We’ve slashed emissions by more than half, all while serving more users than ever before,” said Lisa Jackson, Apple’s vice president of Environment, Policy, and Social Initiatives. “More hard work is ahead of us, and we’re focused on harnessing the power of innovation and collaboration to maximize our impact.”

Teams across Apple and its global supply chain have contributed to Apple 2030 and the company’s environmental efforts, driving innovations in clean energy and energy efficiency, materials, carbon removal, water stewardship, zero waste, and recycling. As Apple celebrates Earth Day with its customers around the world — including through curated environment-focused collections on podcasts , books , and more — here’s a look at 10 innovations, partnerships, and activities engaging customers and advancing global climate and environmental progress.

Apple’s work toward making products using only recycled and renewable materials has spurred innovation in sourcing and design — while driving major reductions in the company’s carbon footprint. This includes materials critical to the clean energy transition. Last year, 56 percent of the cobalt shipped in Apple batteries came from recycled sources, more than double the year before. 1 That includes the MacBook Air with M3, the first-ever Apple product to be made with 50 percent recycled material. And in another first, 24 percent of the lithium shipped in Apple batteries last year came from certified recycled sources. For both lithium and cobalt, Apple is sourcing from post-industrial scrap and post-consumer scrap from end-of-life batteries. The company has also made strides with copper, using 100 percent recycled copper in key thermal applications in iPhone 15 and the 16-inch MacBook Pro, as well as the Taptic Engine and printed circuit boards across many product lines in the last year. The progress demonstrates real potential for recycling to help meet the growing demand for critical materials in the future.

The ongoing transition to clean electricity across Apple’s supply chain has driven the majority of emissions reductions so far, with Apple’s Supplier Clean Energy Program now supporting over 16.5 gigawatts of renewable energy around the world. And by prioritizing energy efficiency in collaboration with Apple, more than 100 supplier facilities achieved over 2 billion kilowatt-hours of electricity savings last year. Together with additional energy savings — primarily associated with heat — these facilities avoided nearly 1.7 million metric tons of carbon emissions, up 25 percent from 2022. Apple is also working to address the direct climate impact of industrial processes, such as the manufacturing of flat-panel displays, which emits highly potent fluorinated greenhouse gases (F-GHGs). Every display supplier has committed to a high standard of F-GHG abatement, and Apple is engaging with them to track emissions and deploy state-of-the-art abatement equipment at manufacturing sites.

Apple’s journey to remove plastic from its packaging is fueled by innovation, using fiber-based plastic alternatives that still provide an unmatched unboxing experience for customers. In the last year, Apple reached a milestone with the release of its first-ever 100 percent fiber-based packaging in the new Apple Watch lineup and for Apple Vision Pro. Across every product Apple shipped last year, only 3 percent of the packaging was made from plastic. Teams continue to innovate — this week, Apple published a new white paper with the University of British Columbia’s BioProducts Institute that analyzes the challenges with current consumer packaging and explores more sustainable future solutions through the use of advanced fiber-based materials. And in partnership with RISE Research Institutes of Sweden , Apple announced the development of a fiber-based alternative to the protective foams widely used in many types of packaging.

As Apple accelerates work to address climate change, the company is also focused on supporting efforts led by communities experiencing disproportionate impacts. Through its Strengthen Local Communities program, Apple is providing a series of new grants to organizations worldwide that are taking action to protect the health and wellbeing of their communities. In the U.S., Apple is also supporting the growth of Justice Outside’s Network for Network Leaders program to promote the outdoors, environmental education, and environmental justice. Apple has also worked with the Lewa Wildlife Conservancy in Kenya to support water harvesting and climate-smart agriculture by funding a rainwater catchment system at the Lewa school in Mutunyi and drip irrigation kits for farmers working to encourage more sustainable agriculture practices in their communities. This year, the company will build on this work with new support for Lewa’s community water access programs. And in Australia, Apple will extend its funding for the Karrkad Kanjdji Trust (KKT), an organization led by the traditional owners of Warddeken and Djelk Indigenous protected areas. Apple’s grant will support KKT’s Indigenous Women Rangers Program and conservation activities across the protected areas.

As part of the company’s commitment to zero waste, last year Apple completed the installation of reusable air filters at every one of its data centers worldwide. The shift avoids sending 25 tons of dirty filters to landfills each year — enough to fill an entire football field — and cuts fan energy use by 35 percent. Working together beginning in 2019 at Apple’s Reno data center, Apple and automotive filtration and technology company K&N prototyped and tested 20 versions of an all-new reusable filter design to meet high standards of performance and efficiency. Today the reusable filters are quickly becoming standard, not just for Apple but industrywide. Innovations like this have contributed to significant progress: In the last five years, Apple increased the diversion rate from its data centers from 64 percent to 90 percent.

Apple has engineered entirely new technologies to advance the field of electronics recycling — including disassembly robot Daisy, which can now take apart 29 models of iPhone into 15 discrete components, and recycling machines Dave and Taz, which are now deployed with a recycling partner in China. This year, Apple introduced a new product sorter to its asset recovery center in California, with the goal of automating the process to improve efficiency and productivity. Apple is committed to sharing the technology with recycling partners around the world as a low-cost, time-saving solution. As an additional efficiency improvement, the asset recovery center now employs autonomous mobile robots to help transport products and components around the facility. Through academic partnerships with institutions such as Carnegie Mellon, the company is also working to further harness the power of artificial intelligence, machine learning, robotics, and automation in recycling.

Apple’s commitment to design with the environment in mind extends beyond products and includes the construction of its buildings. Today, more than 100 of Apple’s retail stores, corporate offices, and data centers worldwide are certified through Leadership in Energy and Environmental Design (LEED), and Building Research Establishment Environmental Assessment Method (BREEAM), two internationally respected accreditation processes for sustainable buildings. The number continues to grow — currently, Apple is developing more than 18 million square feet of green building space globally. In 2023, a building in Apple’s Culver City, California, campus achieved LEED Platinum status, the highest possible rating, for significant energy and water savings, renewable power, and waste diversion. And the new Apple Battersea campus and retail store, located in London’s historic Battersea Power Station, diverted 99 percent of construction waste from landfill, while employing sustainable design elements and low-carbon materials.

In the roadmap to achieve its Apple 2030 climate goal, Apple is prioritizing direct emissions reductions across all operations and its supply chain. For residual emissions that are difficult to avoid with today’s available solutions, the company is investing in high-quality, nature-based carbon projects, including through its innovative Restore Fund . Building on a strong portfolio of sustainable forestry projects in partnership with Goldman Sachs and Conservation International, Apple has launched a new phase of the Restore Fund with Climate Asset Management, focused on creating a portfolio that pools regenerative agriculture projects with ecosystem conservation and restoration projects. This year, Apple suppliers TSMC and Murata joined the fund’s second phase with their own investment commitments. And today Apple is announcing the first set of regenerative agriculture projects the fund has invested in, which includes the development of olive and almond farms in Portugal, an almond farm in Spain, and a farm in Australia that is being converted from sugarcane to macadamias. The projects adhere to strict protocols to ensure water security and efficiency, and employ proven measures to improve soil quality and promote biodiversity.

Last year, nearly 12.8 million devices and accessories were sent to new owners through AppleCare and programs like Apple Trade In — more than ever before. As of today, iPhone 7 still offers Trade In value. Apple will responsibly recycle products that no longer have value, and recover the valuable materials inside so they can live a new life in future products. From reboxing old devices to send back to Apple, to organizing a collection drive, to simply passing on an old iPhone to a family member, there are so many ways customers can contribute to Apple’s environmental goals. Customers can drop off their used Apple devices at any Apple Store location, or by visiting apple.com/recycle .

Across Apple’s ecosystem, the company is offering opportunities for users to educate themselves on climate change and other environmental issues, take meaningful action in their communities, and celebrate Earth Day. On April 22, Apple Watch users can earn a limited-edition award by completing any workout of 30 minutes or more.

Customers can also attend Today at Apple programming featuring environmental leaders and visionary organizations in select Apple Store locations worldwide. In all stores globally, Apple Retail will also host a Pop-Up Studio titled Photograph Earth Like a Pro on iPhone, demoing features like macro photography and more on iPhone 15. This year, Apple will again collaborate with Dolores Huerta, social justice advocate and founder of the Dolores Huerta Foundation, as part of the Challenge for Change learning series. Learners of all ages can participate in the challenge Create a Better World Through Environmental Justice , which offers thought-provoking discussion guides. And a new resource — 30 Creative Activities to Help the Environment — is designed to inspire new ways for people to take action in their communities.

On Earth Day and every day, Apple is committed to taking action to protect the planet and to inspire others — including Apple customers — to do the same.

Press Contacts

Sean Redding

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Purchasing and Supply Chain Management Essay

Types of negotiations, role of framing, role of purchasing and supply management professionals, the interface between purchasing and supply management and logistics management, distribution management, implementation of a supply chain management strategy, role of higher education and professional development providers, difference between attaining a degree and achieving a certificate.

There are two types of negations; they are integrative and distributive. Integrative negotiation involves the cooperation of parties with the intention of both to achieve satisfactory results. The parties involved in the integrative negotiation apart from solving a problem also aim at creating value for both sides. On the other hand, distributive negotiation involves parties that compete for sharing of a fixed sum of value. Its strategies include exposure of proprietary information, identification of own preferences, needs, concerns, interests, resources, and capacities. Although integrative and distributive negotiations are essential in carrying out business, in preparation for supplier alliance, it is essential to use the integrative type. This is because apart from expanding the business, integrative negation leads to the production of goods and services as per the requirement of the customers. (Harvard Business School Publishing Corporation and the Society for Human Resource Management, 2005).

Efficient planning is vital to meeting negotiation goals. For the parties to reach amicable agreements, they must first frame the key problem they have in common. Matching of the negotiators’ frames leads to the success of the negations, hence the smooth flow of the process involving both parties. (Harvard Business School Press, 2005).

Purchasing and management professionals protect testing services and store the instrumentation of an organization. The purchasing department relies on the expertise of these professionals in identifying, crediting, and selecting competent sources for a company (Guinipero et al., 2010).

Purchasing and supply management engrosses storage, procurement, and supervising of goods sold in a retail shop, supplies, machinery, or other raw produces. The logistic management manages the flow of these resources and goods from the place of production to the destination point through offering transportation services to meet the interests of the corporations or customers. Through logistic management, ordering of goods from the retail stores is also made online, hence the movement of goods from retail shops to the customers links the two types of management (Guinipero et al., 2010).

Just as logistic management, distribution management involves overseeing the movement of products from the manufacturer to the selling point. Distribution management also refers to a diversity of activities and practices, such as inventory, packaging, warehousing, and supply chain, that is a role played by Purchasing and Supply Management.

Interaction between Purchasing and Supply Management and Logistic Management leads to the integration of steps required by the Supply Chain Management in meeting its strategies of producing the right products and delivering them to the end-users in time. This is made possible by the role played by PSM in supervising the quality of materials sold at the retail shops and transportation management of these goods to customers by LM (Guinipero et al., 2010).

It is the role of higher education and professional development providers to enact individuals based on the data instead of emotions in negotiations. They will succeed in this by instilling financial and logical skills to individuals to enable them to take part in the challenge of future negotiations. Replacement of face-to-face negotiations with electronic devices also calls for the support of higher education providers. This is due to the demand for qualified suppliers in the future.

Certification in the supply chain unlike a degree in the supply chain is usually focused on one professional area making it more specialized and valuable in the working field. In addition, certification in the supply chain requires maintenance of learned things throughout one’s education; that is an element that is not practiced by individuals undertaking degrees. An individual undertaking master’s degree in PSM is more equipped academically compared to a person undertaking a master’s certificate in PSM. This is because carrying out researches, he or she is also supposed to document factual books on the area of specialization.

Guinipero, L., Handfield, R., Monczka, R. & Patterson, J. (2010). Purchasing and Supply Chain Management. New York: Cengage Learning EMEA.

Harvard Business School Publishing Corporation and the Society for Human Resource Management. (2005). The Essentials Of Negotiation . New York: Harvard Business School Press.

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Bibliography

IvyPanda . "Purchasing and Supply Chain Management." March 23, 2024. https://ivypanda.com/essays/purchasing-and-supply-chain-management/.

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