Last Updated February 2000
The Basics of Supply Chain Management
| Course Outline | I. Materials Management | II. Forecasting/Master Planning | III. Material Requirements Planning | IV. Capacity Management and Production Activity Control | V. Inventory Management | VI. Physical Distribution | VII. Quality Management and Purchasing | VIII. Just-In-Time Manufacturing |
Supply Chain Management - What is it?
In the area of production and inventory management, no phrase has been talked about more these past few years than supply chain management (SCM). SCM has been growing in popularity for the past couple of years, and seems to have peaked in the past few months. All the software companies are ready to support it, the consulting firms are preaching it, and the trade press is eating it up.
Out of the depths of the past of MRP, MRPII, DRP, ERT, etc., we now find ourselves looking at a new idea. A newly formed group called the Supply Chain Council defines it as the "effort involved in producing and delivering a final product from the suppliers' supplier to the customer's customer". This is accomplished by looking at basic, yet broad processes - planning, sourcing, receiving, manufacturing, and distribution
The supply chain is made up of suppliers, purchasing, operations, logistics, distributors and retailers. Together they are an extension of your company and are linked together for the purpose of moving product in an efficient manner.
Regardless of what it is, success in managing the supply chain begins with a strong foundation. You have to be able to do the basics: take an order, give an accurate promise date, manufacture the right goods, allocate properly, ship efficiently, and do it all in a cost effective manner while keeping minimal finished goods inventory. What ever bells and whistles you add to the foundation are great, but if you can't do the simple stuff, there is no way you can support supply chain management or any other leading-edge technology.