√ Definition of Supply Chain Management, Components and Networks
Definition of Supply Chain Management, Components and Networks – In this discussion we will explain about Supply Chain Management or also known as Supply Chain Management. Which includes definitions, components and supply chain management networks with complete and easy-to-understand discussions.
Definition of Supply Chain Management, Components and Networks
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Definition of Supply Chain Management
Supply Chain Management is a series of activities that include coordination, scheduling and control of procurement, production, inventory and delivery products and services to customers which include daily administration, operations, logistics and information processing from the customer to the customer supplier.
Another definition of Supply Chain Management or supply chain management is a system that is in a mechanism connecting all related parties and activities involved in converting raw materials into finished goods.
Related parties and activities referred to have the responsibility to provide finished goods from production to consumers at the right time and place by applying the right method efficient.
Supply Chain Management Components
The important components in Supply Chain Management that must be considered are as follows:
Production
Which aims to get results against market expectations at the right time with sufficient production volume. To achieve the goal, it is necessary to consider appropriate limitations such as capacity and level of quality desired and also takes into account other important functions such as workload capacity, equipment maintenance and etc.
Inventory
Any level of inventory from various SKUs must be spread in various stages in all supply chain management. Inventory levels in activity as a buffer and protect the business from fluctuations in demand.
Location
Locations are along the chain which will be different types of facilities. About other important decision making will be the very maximum location for all facilities, warehouses and warehouses. Another decision relates to setting up a new facility.
Transportation
The need to move inventory from one point to another across the entire supply chain is wrong one of the main functions in supply chain management which requires other important issues in decision making.
The question is how goods should be moved and what type of transportation to choose? So the answer is that it can be different for different types of products, and also different types of markets that are selected geographically and differ according to infrastructure equipment.
Information
This section puts more emphasis on decision making regarding the level requirements in data collection and data sharing. There are some good things in making information sharing but it also comes with a lot of associated risks.
This also applies to data collection, large databases which lead to more informed decision making but can also be expensive.
Supply Chain Management Network
There are five networks in the Supply Chain Management process according to Anwar (2011), including:
Chains 1. Suppliers
The network starting from here is the source that provides the first material, which is where the new distribution chain will be initiated. This first material can be in the form of raw materials, raw materials, auxiliary materials, merchandise, spare parts and others.
Chains 1-2. Supplier-Manufactures
Manufacturing or other forms that carry out the work of making fabricating, assembling, assembling or converting or finishing (finishing).
The linkage of the two chains has the potential to carry out savings. Savings can be obtained from inventories of raw materials, semi-finished materials and finished materials which are on the part of suppliers, manufactures and transit places are the targets for saving.
Chains 1-2-3. Supplier-Manufacturing-Distribution
Goods that have been produced from manufactures have started to be distributed to customers. While there are many ways to deliver goods to customers, the most common is through distributors and is often used in most supply chains.
Chains 1-2-3-4. Supplier-Manufactures-Distribution-Retail Outlet
Wholesalers often have their own warehouse facilities or can also rent from other parties. This warehouse is used for storage of goods before being distributed again to retailers. Here there is an opportunity to get savings in the form of inventory and warehouse costs by how to re-design the pattern of shipping goods either from the manufacturing warehouse or to a shop that is retail.
Chains 1-2-3-4-5. Supplier-Manufactures-Distribution-Retail Outlet-Customer
Retailers or retailers offer goods directly to consumers or buyers or users of goods directly. Which includes retail outlets, namely grocery stores, supermarkets, stalls and others.
Thus has been explained about Definition of Supply Chain Management, Components and Networks, hopefully can add to your insight and knowledge. Thank you for visiting and don't forget to read other articles.
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