The concept of a supply chain must be clear before understanding anything about Supply Chain Management. It is a coordinated network of people, organisations, activities, resources and information and is mainly required to make a finished product and eventually dispense it to the customers. Its management involves planning, applying and overseeing its operation with the sole aim of satisfying customer needs and requirements in an effective way.
Obtaining customer feedback is an essential element of Supply Chain Management as it helps in improving the product quality whenever needed according to the customer’s wants. It enables the smooth functioning of the manufacturer and purchaser relationship. Furthermore, its complexity depends on the quantity of products manufactured and the size of the business.
Supply Chain Management consists of several elements which, when linked together, ensure an effortless flow of productivity. The supplier leads the chain with the customer at the other end of it.
It starts with a customer deciding on the quantity of items required and through the sales department of the company, the quantity of items, the delivery date and a receiving place should be decided upon.
The requirements of different customer’s orders are combined and plans are made. These plans include materials to be bought or manufactured to ensure the high quality of products keeping the deadline in mind.
Once the purchasing facility receives the above mentioned information, it sends the list of required materials to the supplier so that they can proceed with the production of goods.
The materials thus received will be approved for accuracy and quality and kept in a warehouse until the production department calls for them.
The manufacturing of the finished products begins and these products are later sent to the storage or inventory to be delivered to the customers.
The shipping method is then decided in order to deliver the products in an efficient and cost effective way. An invoice is received mentioning the date, time and products that are delivered.
The primary function of Supply Chain Management is to ensure that the aforementioned tasks are completed in a hassle free manner. Moreover, it also needs to be flexible in a way that will yield the best results. Thus, if required, certain operations must be outsourced to corporations who can perform the given task in a competent or cost effective way. Supply Chain Management must be used as an effective tool to increase productivity.