Supply Chain Management Overview

Definition and Scope

• Encompasses all business and operational processes
  • Procurement
  • Manufacturing
  • Finished goods transportation
  • Warehousing and distribution
  • Inventory management

Global Business Scenario

• Characterized by:
  • Geographically spread markets
  • Global raw material procurement sources
  • Cheaper manufacturing and labor markets in developing countries
  • Constantly changing and evolving demand and suppliers

Role of Information Technology

• Information technology has redefined all aspects of business
• Businesses use ERP (Enterprise Resource Planning) systems such as SAP, Oracle, and PeopleSoft
  • Manage procurement, production, sales, and finance seamlessly
  • Enhance business processes traditionally managed manually

Enabling Tools

• Demand planning and forecasting
• Global procurement management
• Cost-effective manufacturing practices:
  • Just in Time (JIT)
  • Kanban
  • Vendor Managed Inventory (VMI)

ERP Impact

• Manages finished goods distribution, transportation, and inventory management
• Drives sales processes
• Allows companies to manage global business processes under one standard
  • Provides standardization and control

E-commerce Influence

• Redefines business operations
• Online purchasing impacts supply chain organization
• Personalized customer experience through online marketing
• Instant information delivery through the internet
  • Requires immediate customer response and action
  • Decreases sales lead time

Global Reach

• Internet technology opens geographical boundaries
• Enables global purchasing at the click of a button
• Necessitates robust logistics and supply chain networks

Supply Chain Complexity

• Goods and services pass through multiple chains:
  • Transporters
  • Forwarders
  • Customs
  • Distribution centers
  • Distributors
  • Retail outlets
• Data, documentation, and information availability is crucial

Importance of Information Technology

• Considered the most important enabler of the supply chain in modern global business