Supply Chain Management

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Thousands of activities are performed and coordinated within an organization, and every company at least one supply chain relationship with another organization. Research has led to the conclusion that "the structure of activities within and between companies is a critical cornerstone of creating unique and superior supply chain performance" (Lambert, 2005). Successful supply chain management requires integrating business processes with key members of the supply chain, because valuable resources are wasted when supply chains are not effectively managed. Standard business processes enable managers from different organizations in the supply chain to use a common language and link-up their organizations' processes with other members of the supply chain.
Demand management is the supply chain management process that balances the guests' wants and needs with the capacity of the supply chain. Management can match supply with demand and have few disruptions if the appropriate process is already in place. The process is not limited to forecasting, but also includes matching supply and demand and increasing flexibility. An effective demand management system uses any available data to reduce uncertainty and provide efficient flow throughout the supply chain. Marketing requirements and production plans should be coordinated on a corporate level, so that multiple vendors are not delivering the same products for different prices to each hotel location. Instead, cost savings can be found in consolidation of orders.
Supplier relationship management is the process that defines how a hotel interacts with its suppliers. As the name suggests, this is a mirror image of guest relationship management, because a hotel needs to foster relationships with its suppliers too. As in the case of guest relationship management, a hotel will forge close relationships with a small subset of its suppliers, and manage arm-length relationships with others. A contract is negotiated with each



References: Bhattacharya, S., Upadhye, A., & Dham, S. (July/September 2004). Reengineering a Hotel 's Purchasing Process. SETLabs Briefings, 2(3). Retrieved October 4, 2005, from Chatur, A.A. (1 July 2005). Driving Costs Out of the Supply Chain: Inbound Logistics. Infosys Technologies Limited. Retrieved October 4, 2005, from Hausman, W.H. (8 March 2005). Financial Flows & Supply Chain Efficiency. Visa Commercial Solutions. Retrieved October 1, 2005, from Lambert, D.M. (15 September 2005). Supply Chain Management: Processes, Partnerships, Performance (2nd Edition). Supply Chain Management Institute Neef, D. (14 April 2005). Supply Chain Ethics: The Devil is in the Details. Ethical Corporation. Retrieved October 2, 2005, from

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