Report on Supply Chain Management

Definition of Supply chain Management

The supply chain management can be defined as management of the flow of services and products. The management process includes management of transformation of the raw materials into the final products. The supply chain management represents the efforts of supporters and suppliers for the development and implantation of proper management process. The management of supply chain is economical and efficient [1, 2].  

The supply chain is not just a word but it is a complete process, a process that is being associated with the specific company along with its suppliers for the production as well as the distribution of a specific kind of product to the final buyer. Supply chain management is also the same thing that has been associated with the management of all this process that how it works and takes place. Supply chain management is a kind of integrated process with specific planning along with the controlling of different kinds of products, specific kinds of information and the money across the whole value as well as the supply chain from different kinds of customers towards the supplier of raw material [3].

Council of the supply management professionals has defined the supply chain management is a way that is:

“Supply chain management incorporates the management along with the planning of all activities that are being involved in the procurement, conversion, sourcing and all of the management activities linked with the logistics. Most importantly, it also includes the collaboration and coordination with their channel partners that can be the suppliers, mediators or can be the customers as well. So basically, supply chain management assimilates the supply and the demand management within the companies or across the companies as well.”

Supply Design Parameters

Supply chain management design parameters are being used to help in the publicity of different products and to make sure as well that buyers are getting what they need and what they like as well [4].

There is not just a single method of supply design parameter but three different kinds of parameters are being used that are:

The first one is strategic management. At this strategic level, management of the different companies makes decisions that are high in level and that are also being related to the whole organization. This parameter is of much use and provides the benefits to the company as well. Decisions that are being made with regards to the supply chain must have to reflect the complete and overall corporate strategy that any of the organization is following [5]. In this strategic level different kind of subgroups is being included that are:

·         Development of the product. Different kinds of products need to be visualized that how they are being developed and further transferred into the market or to some other company.

·         The second one is the presence of customers. The company needs to look or identify the customers in this group for their services and products as well.

·         Manufacturing of the product in a complete well-defined way. At this level, decisions related to the manufacturing define the infrastructure and technology related to the manufacturing that is being required. Relying upon the forecasting and the estimation of sales as well, company management needs to make some sort of strategic decisions in the future that how products can be manufactured [6].

·         The last one is the suppliers, it needs to be carefully examined about the selection of suppliers.

The next design is the Tactical management that doesn’t focus on the different procedures and processes like strategically management but it helps in the saving of time and money both. It also takes care of all the customer demands and then providing different values to them. This tactical management can help in minimizing the risks a lot [1].

The last one is the operational supply chain management. These decisions are being made almost 100 times a day for every company. Such decisions are specifically made at the business locations that affect how products are being developed, moved and sold [8].

Supply Chain Modelling

The next part is modeling how specific modeling takes place in the area of the supply chain. Well, two different kinds of methods are being used for the modeling purpose and the first one which is going to be described is Mathematical modeling [1, 9].

·         In the process of mathematical modeling, approaches that are being considered usually in the supply chain problems include different kinds of methods like linear programming, non-linear programming, multi-objective programming and many more. This modeling is linked with all the mathematical data that needs to be sorted out. This area covers it most of the time.

·         The second modeling method is stimulation modeling; this area helps in the showing of behavior related to the different logistics networks over a period of time. All the logical rules related to the supply chain are clearly represented in a model and then further executed over a time period for making the stimulations dynamic. Here an example can be used which is, production is being started when certain orders start to deplete the inventory below a specific threshold.

The Modelling Technique for Supply Chain

Modeling technique for the supply chain can be further approached in three different ways that are:

1.      Network Design is the first approach and it helps in determining the location of the production of a specific material, sourcing facilities and different paths of the materials that are being flown through them. All such models are mostly large and normally they are being carried out at the start of a design when the new supply chain is about to take place. Decisions that are being further taken by the use of these models are way more strategic as compared to the operational in nature.

2.      The rough cut method is the second method and this model has been used widely in many of the industries. Many of these models which are being taken on the inventory management perspective are of much use for the decisions taken in the future related to the operational. All these models are also known as multi-level inventory control methods [3].

Obviously, these models do have many of the benefits but along with it, they also have certain limitations as well. The very first limitation is that there are many studies of such types that tend to ignore the side of production at the cell level and supplier capacities as well that are the main parts of the supply chain. Another limitation is that such methods completely focus upon the inventory systems just and then the transportation method starts getting ignored. For all such reasons, many of the professionals think that this method needs to be restricted a bit because of the theoretical nature of this model [1]. There are many of the creators who restrict themselves towards the rough cut models.

3.      Last but not the least design of this supply chain management is the stimulation, this kind of supply chain management is considered to be dynamic in nature.

So, the above mentioned are some of the common designs related to the supply chain management that are being used by different companies.

References of Supply chain Management: