Supply chain management can be defined as the unified orchestration of goods, information, and activities across the value chain aimed at satisfying demand optimally.
A supply chain is a consumer-focused inter-organizational system focused on last-mile delivery of products and services through coordination of products, people, resources, and information on the supply side.
Supply chain activities are connected with external stakeholders like suppliers, service providers, logistics solution providers, and customers. They aim to streamline and optimize the delivery of finished goods to customers spread across various demand centers.
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Supply chain management is a systems approach to controlling activities of internal stakeholders with respect to external stakeholders in order to fulfill product demand. It aims to smoothen the flow of information, goods, services, and final products between “links” inside the stakeholder network, where each stakeholder acts as a “node.”
The ultimate goal of supply chain management is to enhance profitability for each stakeholder organization, improve customer satisfaction and customer experience, maximize productivity, and boost resilience against any unforeseen bottlenecks.
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In order to understand supply chains, they are broken down into simpler “components.” The main components for analyzing supply chains are as mentioned below:
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Supply chains have constantly been evolving since the beginning of globalization, and what started as a war-oriented discipline has turned into a core business activity. Thus, organizations created dedicated job roles to cater to the rapidly changing supply chain priorities.
The following three are the most important job roles with respect to supply chain management:
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With the increasing volatility in global market conditions, supply chain leaders are focusing on optimizing their respective supply chains. They also aim to add more resilience to their supply chain networks and support overall organizational profitability and productivity.
In order to improvise your supply chain and make it more adaptive, you need to understand your supply chain model. Here are leading SCM models that you refer to for analytical purposes:
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Supply chain management is the backbone of an organization’s financial health and competitive edge on top of its operational sustainability. Especially at a time when global corporations are facing steep issues with their supply chains, it is becoming an increasingly important aspect of organizational success.
Good SCM enables corporates to deliver higher customer satisfaction, improve their retention rates, align themselves with market trends, reduce operating costs and improve their finances.
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The single biggest differentiating factor between supply chain and logistics is the fact that supply chain management spans multiple organizations while it is an internal part of an organization.
Logistics is a subset of supply chain management, thereby reflecting the difference in complexities, constraints, and bottlenecks.
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Supply chain optimization aims at minimizing wastage across the network while maximizing competitive benefits for all parties involved. It also reduces the number of blind spots in data, systematic and unsystematic threats, and governance and compliance issues.
It is executed as a set of activities (with the help of the right tools) to enhance visibility, decision-making insights, analytics, and reports, apart from adopting smart automation at multiple levels.
This also includes the use of advanced technologies like Big Data, Machine Learning, AI, RPA, and IoT to help organizations achieve greater control over their supply chains and respond better to any market fluctuations.
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Every organization must follow the below best practices in order to ensure that their supply chains function at optimal levels and that they continue to deliver high-quality customer experiences:
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As the socio-economic priorities continue evolving at a high pace, corporations across the world will require to align their business with the following supply chain trends in 2022:
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