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Supply Chain Management

Gurvir Hans
Concordia University, Montreal
 Introduction
 Benefits of Supply Chain Management
 Problems Addressed
 Functions of Supply Chain Management
 Supply Chain Management Models
 Supply Chain Management Activities
 Strategic level
 Tactical level
 Operational level
 Conclusion

 Design, planning, execution, control and monitoring of

supply chain activities
 Objectives are to:
o Build a competitive infrastructure
o Synchronize supply with demand
o Create net value
o Measure performance globally
o Leveraging logistics
Benefits of Supply Chain Management

 Improve trust and collaboration among supply chain

 Improve inventory visibility
 Improve the velocity of inventory movement
Problems Addressed

 Distribution network configuration

 Distribution strategy
 Trade-offs in logistical activities
 Sharing Information
 Inventory management
 Cash flow
Functions of Supply Chain
 Cross-functional approach
o Movement of raw materials into a plant
o Internal processing of materials into finished goods
o Movement of finished goods out of the plant
o Delivery of goods to the final consumer
 Focus is to:
o Become more flexible
o Reduce the ownership of raw material sources
o Reduce distribution channels
Supply Chain Management Models

 SCOR – promoted by Supply Chain Council

 SCM model – proposed by Global Supply Chain Forum

 APQC Process Qualification Framework – adopted by

Supply Chain Management Activities

 Strategic level

 Tactical level

 Operational level
Strategic Level Activities
 Strategic network optimization – number, location & size of
warehousing, distribution centres & facilities
 Strategic Partnerships with suppliers, distributors &
customers – create communication channels for information
& operational movements
 Product life cycle management – integration of new and
existing products into the supply chain
 Information Technology chain operations
 Where to make & make ‘or’ buy decisions
 Align overall organizational strategy with supply strategy
Tactical Level Activities
 Sourcing contracts and other purchasing decisions
 Production decisions - contracting, scheduling, and planning
process definition
 Inventory decisions - quantity, location, and quality of
 Transportation strategy - frequency, routes, and contracting
 Benchmarking of all operations against competitors and
implementation of best practices throughout the enterprise
 Focus on customer demand and Habits.
Operational Level Activities
 Daily production and distribution planning - all nodes in the supply chain.
 Production scheduling for each manufacturing facility in the supply chain
 Demand planning and forecasting, coordinating the demand forecast of all customers and
sharing the forecast with all suppliers
 Sourcing planning - current inventory and forecast demand in collaboration with all
 Inbound operations - transportation from suppliers and receiving inventory
 Production operations - the consumption of materials and flow of finished goods
 Outbound operations - all fulfillment activities, warehousing and transportation to
 Accounting all transit damage cases & arrange to settlement at customer level by
maintaining company loss through insurance company
 Managing non-moving, short-dated inventory and avoiding more products to go short-
 Due to Globalization, the production/processing of products
have expanded its horizon from national boundaries to over
different continents
 This has increased cross-border sourcing
 Supply Chain Management has enabled collaboration for
various parts of value chain for low-cost providers
 Supply Chain Management helps in proper allocation of
 It helps increasing the net profit of a company and facilitates
logistical and administrative functions