Supply Chain Excellence
Supply chain management (SCM) is a process of planning, implementing and controlling a business supply chain to ensure efficiency and cost-effectiveness. A supply chain is the collection of steps that transform raw components into the final product. SCM is comprised of all movement and storage of raw materials, work-in-process and finished goods from their origin to their consumption, integrating supply and demand management within and across businesses. As a process, it encompasses all the sourcing, procurement, conversion, and logistics management activities; starting and ending with the customer.
As organizations strive to focus on their core competencies and becoming more flexible, more organizations are involved in satisfying customer demand while reducing management control of daily logistics. Less control and more supply chain partners led to the creation of SCM concepts.
Applying the Strategy
The first step in supply chain management is known as planning. A strategy must be developed to address how a given good or service will meet the customer’s requirements and maintain profitability. Strategic activities include building relationships with suppliers and customers, and integrating information technology (IT) within the supply chain. At this level, company management will be looking to high level strategic decisions concerning the whole organization, such as the size and location of manufacturing sites, supplier partnerships, products and sales markets.
Implementation (or development) takes place next. It involves building strong relationships with all necessary raw material suppliers used to make the product the company delivers. In this step, there is comprehensive focus on adopting measures that will produce cost benefits such as developing a purchasing strategy with the finest suppliers, using industry best practices, working to develop cost effect transportation and developing strategies to reduce the cost of storing inventory.
From here, the process is managed and controlled. It includes the daily management of the supply chain—its transactions and relationships, including any rework/recall and ongoing continual improvement. Decisions at this level are made daily, and affect how the products move along the supply chain. Operational decisions involve making schedule changes to production, purchasing agreements with suppliers, taking orders from customers and moving products in the warehouse.
How QPS can help?
All the activities mentioned have to be coordinated in a finely-tuned process in order to achieve the least total logistical cost. Trade-offs exist that increase the total cost if only one of the activities is optimized. It is crucial to maintain a systems approach when planning logistical activities, determining and developing the trade-offs for the most effective and efficient strategy. You need to find a way to streamline your business and remain competitive. Supply Chain Management is a process-focused, effective cost saving tool that will build better customer satisfaction across the board.
- Are you customer focused? Demand driven?
- Is your business proactive or reactive to logistical and quality issues?
- What is happening in the industry and what is the competition doing to satisfy their customers? What is your advantage?
What Supply Chain Excellence can do for you?The purpose of supply chain management is to improve trust and collaboration among supply chain partners, causing more efficient movement of inventory. Creating a demand-driven, process focus for SCM is invaluable to the business focused on quality and now is the time to implement techniques to make the job easier. Customer service has never been more important! Creating partnerships across industries create new stabilities for everyone involved. There have been great advances in e-business in the supply chain and software to make SCM user-friendly and more effective than ever.
QPS works with its clients to create and deliver processes that build high performance at a low cost. Whether you need a dynamite SCM process or industry-specific support, QPS can help you achieve higher performance for real, bottom-line improvements! Let us help you get started on building a more effective and profitable business.
QPS has seasoned strategic and process consultants, each with industry-specific knowledge who can help you identify what you need to excel in your industry. Our consultants will help you unlock the secret to improved supply chain performance—and making the process work for you. We strive for business excellence with a team focused on your success. Contact us
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