Supply chain management (SCM) is the process of coordinating the activities of all the different organizations involved in the supply chain, from raw materials suppliers to manufacturers to retailers.
The goal of SCM is to ensure that goods are produced and delivered in a timely and efficient manner.
In this blog post, we will take a look at five basic components of the Supply Chain Management process. The five components are Plan, Source, Make, Deliver and Return.
Introduction
A supply chain is a group of people, organizations, and resources involved in moving a product or service from supplier to the customer.
The concept of supply chains can be traced back to 17th century Europe when the East India Company had to find a way of transporting spices from the Indian subcontinent over land routes to Europe.
The main goal of any SCM system is to optimize the flow of materials, information, and finances across the supply chain in order to achieve objectives such as increased profits and customer satisfaction.
To achieve these goals, SCM systems need to be able to coordinate and control all aspects of the supply chain including production, transportation, warehousing, and distribution.
In recent years, there has been a growing trend towards using technology to manage supply chains more effectively. This has led to the development of various software applications and tools that can help to automate and streamline supply chain operations.
The Five Basic Components of Supply Chain Management
There are five basic components of SCM: Plan, Source, Make, Deliver and Return.
Plan:
Planning is the first step in SCM. It involves setting goals and objectives for the supply chain and determining how best to achieve them. Planning is the process of figuring out what needs to be done and when it needs to be done.
Source:
Sourcing is the process of procuring the raw materials or components that are needed for manufacturing.
Make:
Making is basically Manufacturing. Manufacturing is the process of transforming the materials and services into the finished product.
Deliver:
Delivering is the process of getting the finished product to the customer.
Return:
Returning is the process of taking back products that are defective or unwanted.
Each of these components is vital to the success of Supply Chain Management. By coordinated all these activities, businesses can ensure that goods are produced and delivered in a timely and efficient manner.
Conclusion
To optimize company’s supply chain, it’s important to understand the basic components of supply chain management. By understanding the role that each component plays, you can develop strategies to improve your overall operations.
In this article, we’ve outlined the five main components of supply chain management. By understanding how each of these components work together, you can start developing a plan to improve your company’s efficiency and effectiveness.
