Supply Chain Management

Supply Chain Management – a working definition and the background to which CHAS current and future services apply.

The term "supply chain management" entered the public domain when Keith Oliver, a consultant at Booz Allen Hamilton (now Strategy&), used it in an interview for the Financial Times in 1982. It gained currency in th​e mid-1990s, when a flurry of articles and books came out on the subject. One of the first to formally define supply chains as encompassing all activities associated with the flow and transformation of goods from raw materials through to the end user, as well as the associated information flows. Supply chain management was thus defined as the integration of these activities through improved supply chain relationships to achieve ​​a competitive advantage.   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.

Other commonly accepted definitions of supply chain management include:

  • The management of upstream and downstream value-added flows of materials, final goods, and related information among suppliers, company, resellers, and final consumers.
  • The systematic, strategic coordination of traditional business functions and tactics across all business functions within a particular company and across businesses within the supply chain, for the purposes of improving the long-term performance of the individual companies and the supply chain as a whole
  • A customer-focused definition is given by Hines: "Supply chain strategies require a total systems view of the links in the chain that work together efficiently to create customer satisfaction at the end point of delivery to the consumer. As a consequence, costs must be lowered throughout the chain by driving out unnecessary expenses, movements, and handling. The main focus is turned to efficiency and added value, or the end-user's perception of value. Efficiency must be increased, and bottlenecks removed. The measurement of performance focuses on total system efficiency and the equitable monetary reward distribution to those within the supply chain. The supply chain system must be responsive to customer requirements."
  • The integration of key business processes across the supply chain for the purpose of creating value for customers and stakeholders

According to the Council of Supply Chain Management Professionals (CSCMP), supply chain management encompasses the planning and management of all activities involved in sourcing, procurement, conversion, and logistics management. It also includes coordination and collaboration with channel partners, which may be suppliers, intermediaries, third-party service providers, or customers. Supply chain management integrates supply and demand management within and across companies. More recently, the loosely coupled, self-organizing network of businesses that cooperate to provide product and service offerings has been called the Extended Enterprise.

A supply chain, as opposed to supply chain management, is a set of organizations directly linked by one or more upstream and downstream flows of products, services, finances, or information from a source to a customer. Supply chain management is the management of such a chain.

Supply chain management software includes tools or modules used to execute supply chain transactions, manage supplier relationships, and control associated business processes.

Attribution: Wikipedia