The Importance And Roles Of Supply Chain Management

1037 Words 5 Pages
I. Introduction

“Supply chain Management is the integration of key business processes from end-users through original suppliers that provide products, services, and information that add value for customers and other stakeholders”(Lambert D.M., 2008). This means that it is management of flowing streams in a business and between the business and the environment, which includes supply, delivery, storage, and financial operations…. In other words it’s managing the means, methods, tools and techniques intended to drive the global chain of supply the most effectively possible and the delivery of a product or service from its productions until it arrives to the end consumer.

However the world is experiencing an increase in the globalization of
…show more content…
In addition to this, we will understand the importance of these elements and grasp the link between them.

Companies can either manage a part of their supplier chain or the whole of their supplier chain. In the manufacturing market, the size of buyers, the importance and requirements are very different depending on the firms. Giving them the choice between making or buying, in other words outsourcing. This means that the active collaboration between the buyers and the supplier is crucial due to the fact that their needs are very specific depending on products or services.
The Purchasing and Supply Management (PSM) importance lies in the direct impact it has on the firm’s profitability. This management goes beyond the mere cost factor due to the fact that companies like Hewlett Packard (HP) are dependent on their suppliers for the quality of their product, but also on their performance that directly affects their own products.
An effective PSM strategy will be based on how a company has defined and set limits related to internal capacity and alignment of the procurement strategy with the core strategy of the business. By doing this, it will enable them to improve optimization of the supply base resources, in other words, improve the Value for

Related Documents