Question

Define Supply Chain.

Answer 1

Supply chain refers to the movement of goods from manufacturers to warehousing which is then transported to the customers. It is very important for managers to focus on improving supply chain profitability or by reducing the supply chain cost to make the supply chain management system effective.

Example - Walmart's supply chain system focus on achieving all the given objective by maintaining the in store inventory and delivered inventory to the store when needed. This helps Walmart's store to get the right product, at right time with right quality which result in reducing the system-wide cost.

The three major technologies that support supply chain management include:-

• Electronic data interchange (EDI) - This is the type of communication where the documents are transferred electronically between business partners.
• Extranets - It is network that connect business partners over the internet. Through this, they have access to certain parts of the corporate intranets of each other.
• Corporate portals - The business activities that involve transaction between single buyer and multiple suppliers and single supplier and multiple buyers are automated using corporate portals.

Supply chain management includes the management of the flow of all information, products, materials and funds from the manufacture to the supplier, then to the wholesaler, retailer and finally to the customers to meet the customers’ demand. Hence connecting the suppliers, manufacturers, distributors and customers with the help of information system such as supply chain management software which helps in increase productivity, provide overall satisfactions, create good relation and minimize the cost is referred as supply chain management.

The goals of supply chain management include: -

• The inventories should be produced and distributed in the right quantities
• The inventories should be distributed to the right location
• The inventories should be distributed at the right time.
• Maintaining long term relationships with the suppliers.
• To minimize the total cost
• To fulfill customer service requirements.