Importance of Supply Chain Management Essay

957 Words Jul 6th, 2008 4 Pages
The Importance of Supply Chain Management

Supply chain management (SCM) is very important and effective to all companies. David Simchi-Levi, Philip Kaminsky, and Edith Simchi-Levi defines supply chain management as “a set of approaches utilized to efficiently integrate suppliers, manufacturers, warehouses, and stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at the right time, in order to minimize systemwide costs while satisfying service level requirements.” Supply chain management, also called logistics network, includes suppliers, industrialized centers, warehouses, distributions centers, and retail outlets, as well as unprocessed materials, work-in-progress stock, and
…show more content…
Just about every company today uses these entities which help company’s to cut costs, reduce lead times, better predict demand, increase profits, increase service level, and increase flexibility.
Supply chain management is related to my area of study, Management, from the facts that I will have to know when I enter the workforce, which are: what employees need to produce and distributed at the right quantities, to the right locations, and the right time, in order to reduce system wide costs while fulfilling service level requirements. Otherwise I wouldn’t be doing my job as a manager properly, and would cause my company harm. SCM is used the same way for managers as is for production for how to manage your employees. Supply chain management is an important field of study for management, because it teaches you to strive for customer focus. According to Gale, customer focus is the fundamental focus of supply chain management begins by understanding the customer, their values, and requirements. It’s a company’s obligation to find out exactly what the customer anticipates from the product or service, and must then completely focus on their efforts to meet their outlook. The buying process of the purchaser must be united with the process of the seller. The behavior of the final customer in the end has all the power over the actions of the whole supply chain, even performance measurements have to be customer driven. A manager has to

Related Documents