Supply chain management
There are several ideas of supply chain function. For
example, Supply Chain Integrates the fundamental of business processes. From
start to end of the process, or to the customers who use the product. The
processes in the middle are transport, storage, and selling to customers (B2B
or B2C). Supply Chain is the activity of integration or interaction between
purchasing and marketing in an integrated manner. Trade in globalization is in
borderless, both logistics and supply chains will have different functionalities
in the area of the market. They are activities that promote marketing and the
production with a clear goal. Supply Chain is the set of activities or function
involve the production, planning process, marketing process especially
marketing mixed. The Supply Chain is related to the Product concept, Product
design, Raw material supply, Production process (Producing), Transport,
Warehouse and Distributor for distribution to wholesalers and retailers, until
delivers to the end consumer. This process is called “VALUE CHAIN”.
Hence, in order to understand deeply will describe more the definitions of
“Supply Chain Management” in the next paragraph.
Supply Chain is the network of organizations that are
involved, though upstream and downstream linkages, in different process and
activities that produce value in the form of products and services in the hand
of the ultimate consumer”
Supply chain is a set of firms that pass materials forward.
Normally, several independent firms are involved in manufacturing a product and
placing it in the hands of the end user in a supply chain—raw material and
component producers, product assemblers, wholesalers, retailer merchants and
transportation companies are all members of a supply chain (La Londe and
Figure 2 is presenting that supply chains defined as a set
of three or more entities (organizations or individuals) directly involved in
the upstream and downstream flows of products, services, finances, and/or
information from a source to a customer.
Definitions of Supply Chain Management
Michael Hugos, 2003 Supply
Chain Management (SCM) refers to the coordination of production, inventory,
location, and transportation among the participants in a supply chain to achieve
the best mix of responsiveness and efficiency for the market being served.
Lean and Agile Value Chain Management: A Guide to the Next
Level of Improvement by Ehap H. Sabri, Salim N. Shaikh, 2010 The APICS dictionary defines SCM as “the
design, planning, execution, control, and monitoring of supply activities with
the objective of creating net value, building a competitive infrastructure,
leveraging worldwide logistics, synchronizing supply with demand, and measuring
Monczka, Trent, and Handfield , 1998 SCM requires traditionally separate materials functions to
report to an executive responsible for coordinating the entire materials
process, and also requires joint relationships with suppliers across multiple
tiers. SCM is a concept, “whose primary
objective is to integrate and manage the sourcing, flow, and control of
materials using a total systems perspective across multiple functions and
multiple tiers of suppliers.”
Cooper et al., 1997 Supply
chain management is “… an integrative philosophy to manage the total flow of
a distribution channel from supplier to the ultimate user.”
Council of Supply Chain Management Professionals (CSCMP),
2017 Supply chain management
encompasses the planning and management of all activities involved in sourcing
and procurement, conversion, and all logistics management activities.
Importantly, it also includes coordination and collaboration with channel
partners, which can be suppliers, intermediaries, third party service
providers, and customers. In essence, supply chain management integrates supply
and demand management within and across companies.