Supply-chain management refers to overseeing materials, information, and finance as they move in a process from supplier to manufacturer to wholesaler to retailer consumer. It involves coordinating and integrating these flows within and among companies. Supply-chain management is the process of moving goods from the customer’s order through raw materials, supply, production and distribution of products to the end user. ‘Supply Chain Management is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers Harlan, 1996). If your company makes a product from parts purchased from suppliers, and those products are sold to customers, then you have a supply chain. Some supply chains are simple, while others are rather complicated. Supply chain management (SCM) is a process used by companies to ensure that their supply chain is efficient and cost-effective. A supply chain is the collection of steps that a company takes to transform raw components into the final product. The following are five basic components of SCM. 1. Plan 2. Develop (Source) 3. Make 4. Deliver 5. Return.
Plan: The first stage in supply chain management is known as plan. A plan or strategy must be developed to address how a given good or service will meet the needs of the customers. A significant portion of the strategy should focus on planning a profitable supply chain. This is the strategic portion of SCM. Companies need a strategy for managing all the resources that go toward meeting customer demand for their product or service. Source: Source is the next stage in supply chain management. It involves building a strong relationship with suppliers of the raw materials needed in making the product the company livers.
This phase involves not only identifying reliable suppliers but also planning methods for shipping, delivery, and payment. Companies must choose suppliers to deliver the goods and services they need to create their product. Make: At the third stage, make, the product is manufactured, tested, packaged, and scheduled for delivery. This is the manufacturing step. Supply chain managers schedule the activities necessary for production, testing, packaging and preparation for delivery. This is the most metric-intensive portion of the supply chain – one where companies are able to measure quality levels, reduction output and worker productivity.
Deliver: Then, at the logistics phase, customer orders are received and delivery of the goods is planned. This fourth stage of supply chain management stage is aptly named deliver. This is the part that many SCM insiders refer to as logistics, where companies coordinate the receipt of orders from customers, develop a network of warehouses, pick carriers to get products to customers and set up an invoicing system to receive payments. Return: The final stage of supply chain management is called return. As the name suggests, during this stage, customers may return defective products. The company will also address customer questions in this stage.
This can be a problematic part of the supply chain for many companies. Supply chain planners have to create a responsive and flexible network for receiving defective and excess products back from their customers and supporting customers who have problems with delivered products. Key Features of Supply Chain Management Supply chain software are robust, feature-rich technology software that enhance operations from end-to-end. Today’s popular supply chain software an help companies achieve and maintain a competitive edge by empowering them to streamline and enhance their most important supply chain operations from start to finish.
With supply chain software in place, organizations can maximize cost-efficiency, increase productivity, and give their bottom line a big boost. This functionality is designed to fully automate and support supply chain processes from end-to-end, and includes: Inventory Management: With a supply chain package, companies can significantly improve the way they track and manage their supplies of raw materials and components needed for production, knishes goods to satisfy open sales orders, and spare parts required for field service and support.
This eliminates excess and waste, frees up valuable real estate for other important purposes, and minimizes related storage costs. Order Management: Supply chain software can dramatically accelerate the execution of the entire order-to-delivery cycle by helping companies to more productively generate and track sales orders. Supply chain also enables the dynamic scheduling of supplier deliveries to more effectively meet demand, and more rapid creation of pricing and product configurations. Procurement:
All activities and tasks associated with sourcing, purchasing, and payable can be fully automated and streamlined across a company’s entire supplier network with a supply chain software package. As a result, businesses can build stronger relationships with vendors, better assess and manage their performance, and improve negotiations to leverage volume or bulk discounts and other cost- cutting measures. Logistics: As companies expand globally, their supply chains become more and more complex.
This makes the coordination of the numerous warehouses and transportation channels involved quite a challenging endeavor thou supply chain software in place. With supply chain, businesses can improve on-time delivery performance and boost customer satisfaction Forecasting and Planning: With supply chain software, organizations can more accurately anticipate customer demand, and plan their procurement and production processes accordingly.
As a result, they can avoid unnecessary purchases of raw-materials, eliminate manufacturing over-runs, and prevent the need to store excess finished goods, or slash prices to move products off of warehouse shelves. Return Management: Supply chain software can simplify and accelerate the inspection and handling of defective or broken goods – on both the buy and sell side of the business – and automate the processing of claims with suppliers and distributors, as well as insurance companies. Many supply chain offerings also include add-on options or modules designed to enhance related activities.
SCM implementation Step: The implementation of supply-chain management in Bangladesh in different sector: Supply Chain management (SCM) means managing the supply of inbound and outbound goods and services in the most cost effective and time sensitive way. This can be done by designing a strategic route plan for the quickest possible pick-up and delivery regimen, from the appropriate suppliers, for all points throughout the assembly line, in order to achieve cost and time related efficiency levels.
Then optimum operational smoothness can be guaranteed giving a business an edge over competitors in marketing goods and services by introducing goods and services quicker than established trend-Logistics is used to put this strategy in place physically. All manufacturing, service oriented and progressive companies have logistics departments that execute SCM plans o that goods and services that come in can be made available to the various departments for meeting production schedule and churning out finished goods and services to the clients in the quickest cost effective way possible.
Logistics uses various infrastructure and machinery to bring about the execution of the SCM strategy. Such SCM and logistics mechanism can be relevant in the macro sense as well, encompassing the economic activity of the whole country. Therefore, roads, railways, waterways, seaport and airport customs facilities and regulations of a country need to be seamless and free of corruption. All of the above fall in the category of logistical infrastructure and are vital for the economic viability of a country .
The preamble of our lead article in the logistics page is always introductory in nature, simply because supply chain management is a subject that is not in the news often and communication on the subject has not been to the desired extent leaving most managers unable to grasp the technicalities of supply chain management though most have to deal with the challenges of managing a supply chain. N Bangladesh, logistical infrastructure as been discussed at length in the media indirectly whenever we have seen news related to port facilities but the significance of supply chain management and the fact that modern logistical infrastructure is a national priority has not gained ground. Here lies the need for a strategic plan commissioned and adopted by the highest authority.
A strategic plan for development of logistical infrastructure would be unique opportunity for not only to improve functional infrastructure but also to reap the benefit of creating thousands of jobs by establishing new businesses and to give a fillip to existing companies that would infinite by getting lucrative contracts to work in improving roads, railway lines, ports, airports, and so on. The strategic plan could improve many things We have heard of suggestions like improving the condition of the Mongol Port, which is currently almost lying idle.
Mongol port could be an alternative port to Chitchatting port but this option is not explored for a variety of reasons, most of which are hazy in design and context.. What a waste that we are unable to offer an alternative port to ease congestion in the Chitchatting port while we have a ready-made port waiting to be re-commissioned. Internal Container Depots ICED) facilities need to be increased so that goods that can be unstudied and delivered to destination in and around Dacha if needed.
Other suggestions that can be a part of strategic plan are – revering ports facilities for moving goods from Chitchatting Port through barge-mounted transportation, improvement of Bangladesh Railways, more off-doc facilities in Chitchatting port to facilitate quick movement of containers within the port, compensation of customs to shorten customs formalities and make them more transparent. The term Supply Chain Management (SCM) itself envisages the need for planning and, Hereford, national strategic plan can be a great benefit for the whole national economy just as SCM plans are evolved for smaller entities like business organizations.
The national strategic plan would have sections that relate to financial requirement needs to implement the plan. Viable financial plan can be drawn up with private sector participation in mind and if the emphasis is placed on transparency and strict supervision of a government team comprising well-known competent and honest officials. The logistics news in Bangladesh is now skewed toward positive sound bites. A preprocessed berthing system known as fixed day window berthing has come into effect in Chitchatting port.
The system, internationally recognized practice, would mean that arrival and berthing of ships would be fixed one-month back. There are also news items coming thorough that speak of initiatives to work toward finding a solution to the issue of licensing for the logistics companies. The much talked about Terminal Handling Charges (TECH) which was abolished recently is also just under the surface with the logistics sector trying to figure out who will ultimately pay this hare which is applicable as per internally accepted shipping inch-terms with the exception of Bangladesh.
Supply Chain Management (SCM) and logistics would have to be accepted as integral to the strategic economic planning that is done by economic think-tank of the country. It is actually possible to think of strategic models for economic development that revolve around a Hub-Port that would service regional economies sprouting growth surrounding the activities centered on the port itself. Businesses would grow to cater to the onrush of maritime visitors. Hotels, recreational facilities and restaurants would be a small art of the various kinds of service that would emerge.
With new businesses would be financial deals to be stuck and venture capitalists would start emerging, merging with other high flyers to create a versatile environment where sky is the limit. Chitchatting is so ideal for a port based development scheme with its natural beauty and potential for tourism. Bangladesh needs to start thinking of a strategic plan based on development of logistics infrastructure centered on a world class port in Chitchatting and related development that can happen in a port based economy.