Supply chain management and logistics is the lifeline of any business. This kind of management has become very popular in society because of its sound relevance. Before looking at the processes therein, it is critical to know what a supply chain is and how it affects the business. When a company buys raw materials from suppliers to create a product that will be sold, this is considered a supply chain. The major difference between different chains is that some are very simple and straight forward while others are complex and intricate.
Therefore, supply chain management and logistics are the processes that see the production of a product until it reaches the consumer. Business experts realized that it is in this process that proper management can be realized. In turn, cost effective methods to run the chain can be achieved. There are various stages that will constitute this chain as follows. These elements make up the supply channel or chain. The first element is the consumer or the market. Their role is very critical. When a consumer has the need for a particular product, they will go to the market to order their desired product. The sales department of a company will be responsible to sell the product to the consumer.
In this light, if the sales department does not have the product already manufactured, they will place an order to the production department. This is geared to produce the ideal product that the consumer needs. Planning of the production is another element in the chain. This will provide proper coordination to ensure that the goods produced meet the client’s specifications. Because raw materials are needed to create the product, the purchasing department will have a role to play. They will make purchase orders to relevant suppliers. After the raw materials are acquired, they can be stored in warehouses and inventory management will come to play in this regard.
The suppliers will send invoices to the company for having delivered raw materials. Supply chain management and logistics is centred on these vital processes. The next step will be to produce the product. When the goods or final products are ready, they can be stored until they are delivered to the consumer. Transportation is another element that will deliver the final product. The above chain description is necessary for companies. Apart from ensuring a smooth flow of activity, this management and logistics check is geared to helping cut production costs. Consequently, many companies have been able to bring on board cutting edge technology to make sure that the chain is optimized.
For example, the Internet and web based applications have enabled real time communication and feedback processing. The supply chain can now be managed in a more superior way. Companies with complex and intricate supply chains cannot survive without proper follow up and planning. For this reason, this management has automated processes to ensure that businesses are performing as they should. Another benefit is that companies are able to employ tactical solutions that will improve the overall performance. It is also a method to check flaws and make changes accordingly. In personal life or in business, this is a method to manage different aspects of life. The result is saving time, costs and increasing productivity.
supply chain management careers
For careers in supply chain management click here. Visitors and consultants from overseas working in the supply distribution & sourcing space are often required to have visitor health insurance to protect against the cost of accidents and illnesses abroad – click here for details.
There’s lots of further information about supply chain management on the website of Supply Chain Management Review.