INTRODUCTION TO SCM
The term "supply chain management" entered the public domain when Keith Oliver, a consultant at Booz Allen Hamilton, used it in an interview for the Financial Times in 1982. The term was slow to take hold and the lexicon was slow to change. It gained currency in the mid-1990s, when a flurry of articles and books came out on the subject. In the late 1990s it rose to prominence as a management buzzword, and operations managers began to use it in their titles with increasing regularity. David Jacoby (2009), Guide to Supply Chain Management: How Getting it Right Boosts Corporate Performance (The Economist Books), Bloomberg Press; 1st edition, ISBN 978-1576603451 A supply chain, as opposed to supply chain management, is a set of organizations directly linked by one or more of the upstream and downstream flows of products, services, finances, and information from a source to a customer. Managing a supply chain is 'supply chain management' Mentzer, J.T. ET. al. (2001): Defining Supply Chain Management, in: Journal of Business Logistics, Vol. 22, No. 2, 2001, pp. 1–25.
A SUPPLY CHAIN is a network of supplier, manufacturing, assembly, distribution, and logistics facilities that perform the functions of procurement of materials, transformation of these materials into intermediate and finished products, and the distribution of these products to customers. Supply chains exist in both service and manufacturing organizations, although the complexity of the chain may vary greatly from industry to industry and firm to firm. SUPPLY CHAIN MANAGEMENT (SCM) is a systems approach to managing the entire flow of information, materials, and services from raw materials suppliers through factories and warehouses to the end customer. SCM is different from SUPPLY MANAGEMENT which emphasizes only the buyer-supplier relationship. Supply chain management has emerged as the new key to productivity and competitiveness of manufacturing and service enterprises. The importance of this area is shown by a significant spurt in research in the last five years and also proliferation of supply chain solutions and supply chain companies (e.g. i2, Manugistics, etc.). All major ERP companies are now offering supply chain solutions as a major extended feature of their ERP packages. Supply chain management is a major application area for Internet Technologies and Electronic Commerce (ITEC). In fact, advances in ITEC have contributed to growing importance of supply chain management and SCM in turn has contributed too many advances in ITEC.
Supply Chain Management, as defined by the world famous, Institute of Supply Management Inc., USA, is the design and management of seamless, value added process across organizational boundaries to meet the real needs of the end customer. Supply chain management is typically viewed to lie between fully vertically integrated firms, where the entire material flow is owned by a single firm and those where each channel member operates independently. Therefore coordination between the various players in the chain is key in its effective management. Cooper and Ellram  compare supply chain management to a well-balanced and well-practiced relay team. Such a team is more competitive when each player knows how to be positioned for the hand-off. The relationships are the strongest between players who directly pass the baton, but the entire team needs to make a coordinated effort to win the race. Supply chain management (SCM) is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management involves coordinating and integrating these flows both within and among companies. It is said that the ultimate goal of any effective supply chain management system is to reduce inventory (with the assumption that products are available when needed). As a solution for successful supply chain management,...
Please join StudyMode to read the full document