Supply Chain Management Essay

2847 Words Aug 17th, 2006 12 Pages
Introduction Supply chain management is an integral component of operation management and has a direct effect on how successfully organizations function. The purpose of supply chain management is to remove communication barriers and eliminate redundancies by coordinating, monitoring, and controlling processes within an organization. Identifying the components of the supply chain, facilitating better decision-making, creating improved communication, and identifying weak links in the chain causing bottlenecks in an organization are crucial to supply chain integration. There are three principle elements of supply chain integration: management of information and financial flows, inventory management, and management of relationships of …show more content…
Many businesses have too much of their limited resource, capital, tied up in their major asset, inventory. Worse, they may have their capital tied up in the wrong kind of inventory. Inventory control systems range from eyeball systems to reserve stock systems to perpetual computer-run systems. Valuation of inventory is normally stated at original cost, market value, or current replacement costs, whichever is lowest. This practice is used because it minimizes the possibility of overstating assets. Minimum inventories based on reordering time need to become important aspects of buying activity. Carrying costs, material purchases, and storage costs are all expensive. However, stock-outs are expensive also. All those costs can be minimized by efficient inventory policies.
Inventory Control Process in a Dialysis Clinic Dialysis as previously described is a life-saving therapy or medical treatment for individuals with limited or no kidney function. Inventory control is an important aspect of the supply chain process for efficient operation in a dialysis clinic. Dialysis clinics offer specialized medical care with the use of specialized medical equipment and items designed and manufactured for use with this equipment. Medical facilities, whether hospitals or specialty clinics, have material inventory needs that are centrally controlled using par levels for manual or automatic

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