Supply Chain Management Plays a Crucial Role in Businesses

Supply Chain Management Plays a Crucial Role in Businesses

By Manufacturing Technology Insights | Wednesday, March 20, 2019

SCM (Supply Chain Management) is a broad, connected network of organizations, resources, and technologies that involves planning, controlling and executing a faster production cycle in the most streamlined and cost-effective way.

Supply Chain Sustainability

Improving supply chain sustainability ensures delivery and quality performance targets are achieved efficiently. It is a holistic view of supply chain processes that address the environmental, social, economic, and legal aspects of supply chain’s components.

Businesses can choose and collaborate with other sustainable suppliers. This combination of resources between manufacturers and organizations help them to reduce waste, environmental risks, and costs.

Sustainable Procurement

By applying business sustainability, the enterprises make economical and effective long-term decisions that benefit them, customers, society and the environment. The desire to have good public relations with the consumers, the initiative to implement sustainable procurement is taken which also promotes business accountability and transparency.

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Benefits of Supply Chain Management

The companies achieve benefits through the appropriate strategies which when applied creates efficiency, lowers cost, and increases profits. It also enables the businesses to manage the on-growing demand, carry the right amount of inventory, deal with disruptions, and meet the consumer demand in most effective ways.

The role of Supply Chain Analytics

The application of supply chain analytics is to improve forecasting and be more responsive to consumer needs. Businesses can anticipate their consumer demand by using predictive analysis on point-of-sale data stored in a demand signal repository.

Procure-to-pay (P2P) analytics helps in identifying the best suppliers and provides early warning of budget overruns in specific expense categories.  Also, supply chain finance analytics helps in knowing the increased capital costs or opportunities boosting working capital.

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Limitations of Supply Chain Management

The primary function of supply chain management is to link significant business functions and processes within and across the enterprises into a cohesive and high-performing organizational model. Supply chain management drives coordination of operations and activities such as marketing, product design, sales, finance, and information technology.

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