Question

In: Operations Management

all of the following are elements of the supply chain umbrella except? 1.materials or inventory control....

all of the following are elements of the supply chain umbrella except?
1.materials or inventory control.
2.shipping
3.inbound transportation
4.demand and supply planning
5.cash flow management .

Solutions

Expert Solution

Supply chain Umbrella: a large set of activities beside Purchasing comes under the perview of Supply chain Umbrella.  Each of these seemingly diverse activities has one important feature in common—it is part of a network that will define how efficiently and effectively goods and information flow across a supply chain. Although, the need to perform supply chain activities has been present for many years. It is an organization’s willingness to align, coordinate, integrate, and synchronize these activities and flows that is relatively new.

These are the following elements of supply chain umbrella as given below:

  • Materials or inventory control: The materials control group is often responsible for determining the appropriate quantity to order based on projected demand and then managing materials releases to suppliers. This includes generating the materials release, contacting a supplier directly concerning changes, and monitoring the status of inbound shipments.

Inventory control is responsible for determinig the invetory level of finished goods required to support customer requirement, Which emphasizes the physical distribution(outbound or downstream) side of the supply chain. Integrated supply chain requires material and inventory control group cordinate thier effort to ensure smooth flow to customer.

  • Shipping: This activity involves physically getting a product ready for distribution to the customer. This requires packing to prevent damage, completing any special labeling requirements, completing the required shipping documents, and/or arranging transportation with an approved carrier. For obvious reasons, shipping and outbound transportation must work together closely.
  • Inbound Transportation: Larger organizations usually have a specialized traffic and transportation function to manage the physical and informational links between the supplier and the buyer. For some organizations, transportation is the single largest category of single costs, especially for highly diversified organizations. Although a firm may have minimal common purchase requirements among its operating units, there usually are opportunities to coordinate the purchase of transportation services.
  • Demand and supply planning: demand planning identifies all the claims(demand) on output. This includes forecasts of anticipated demand, inventory adjustments, orders taken but not filled, and spare-part and aftermarket requirements. Supply planning is the process of taking demand data and developing a supply, production, and logistics network capable of satisfying demand requirements.  

This given element is not the part of Supply chain Umbrella:

  • Cash Flow Management: is part of Accouting not Supply chain. Cash flow management refers to the process by which an organization maintains control over the inflow and outflow of funds. The fundamental goal of cash flow management is to ensure that the incoming flow of funds is always greater than the outgoing so that the business sits on a surplus. Cash flow management also serves the ancillary function of ensuring the surplus funds are invested or held wisely to reap optimum returns on capital blocked.

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