What is supply chain operations

Chapter 2 Supply Chain Operations, Processes and Planning Supply chain management operations govern the overall structure of how a business plans, creates, receives, and fulfills products. Definition, importance, and risks Goals and benefits Principles and strategy Risks and challenges Operations, processes, and planning Supply Chain Management and logistics: What's the difference? Share this page. Table of Contents Definition, importance, and risks Goals and benefits Principles and strategy Risks and challenges Operations, processes, and planning Supply Chain Management and logistics: What's the difference?

As such, this chapter examines seven elements companies of all sizes regularly overlook in supply chains: Customer relationships Customer service Demand management Order fulfillment Manufacturing flow Supplier relationship Product development Customer relationships For a company to build a large following of loyal customers, it needs to build a solid relationship with each and every one of the people or organizations it does business with.

Customer service Customer service management takes the more abstract concepts involved with customer relationship management, and develops a concrete plan to actually put these ideas into action. That said, customer service management involves defining how your team will: Optimize communication and the delivery of information between your team and your customers Streamline the delivery of technical and other operational support to your customers in need Improve your overall processes so as to avoid technical and operational issues in the first place Again, supply chain management and customer service management go hand-in-hand: an issue in one area often means an issue in the other.

Demand management Demand forecasting is a key element in planning a supply chain strategy, and in turn determining the agility and responsiveness of a business to fluctuating demand. Creating a systematic process for forecasting helps businesses to do the following: Maintain optimal stock levels, regardless of fluctuations Effectively manage distribution networks Maximize warehousing and inventory cost efficiencies Make data informed decisions about sales and marketing Scale up and expand into new markets Respond quickly to changing market conditions Prepare budgets, bookkeeping, and accounting Reduce the need for safety stock All of the above contribute to a more efficient supply chain, increased sales, and improved customer satisfaction.

Order fulfillment Order management and fulfillment is a major component of successful supply chains for both large and small businesses alike. But a suboptimal approach to order fulfillment can also lead to losses for your business in the form of wasted resources. Supplier relationships Whether you are an eCommerce retailer or a regular stockist, supplier relationship management should hover near the top of your must-do list.

Read the whitepaper. Discover what it takes to drive business transformation by changing the way employees behave, which first requires changing how they think. Learn how to survive through disruption by becoming a modern software delivery organization. Read this guide to transform through technology and avoid extinction. Read the guide.

Learn what company culture looks like for organizations with strong business agility and how leaders can position more successful transformations by building a culture of agility.

Learn why Modern Software Delivery is fundamental to successful business transformation efforts and what it takes to get started with MSD.

Many opportunities exist within supply chain planning and optimization, but they all begin with an understanding of purpose, process and data.

Purpose and process are best understood within the context of cross-functional sales and operations planning, which are designed to develop consensus around goals and responsibilities over the short, medium, and long term. Data provides the means to measure performance against prior-period goals and, as part of a performance management process, leads to an understanding of how to improve both planning and execution.

Deeper investigations into the supply chain can target specific areas for improvement. For example:. Customers are demanding and providing superior customer service comes at a cost.

Fundamentals include product quality, return rates, order fill rates, perfect orders and on-time delivery. However, one of the most overlooked dimensions of customer service is the understanding of the cost to serve. This goes much deeper than measuring the cost to pick, pack and ship since it also includes the systems and staff to take orders, answer phones, manage systems and replenish products. Walgreens Boots Alliance. Business Essentials. Corporate Finance. Your Privacy Rights. To change or withdraw your consent choices for Investopedia.

At any time, you can update your settings through the "EU Privacy" link at the bottom of any page. These choices will be signaled globally to our partners and will not affect browsing data. We and our partners process data to: Actively scan device characteristics for identification. I Accept Show Purposes. Your Money. Personal Finance. Your Practice. Popular Courses. Business Essentials Guide to Mergers and Acquisitions.

Business Business Essentials. Table of Contents Expand. What Is Supply Chain Management? How SCM Works.

SCM vs. Supply Chains. Example of SCM. Key Takeaways Supply chain management SCM is the centralized management of the flow of goods and services and includes all processes that transform raw materials into final products.

He is an experienced SAP Consultant with a demonstrated history of working in the information technology and services industry. He has been providing ERP solutions for plant manufacturing processes and supply chain based clients. He maintains interest in travelling, biking and sports.

You can connect with him on LinkedIn. Home Website Contact. Agile Model is ideal for businesses that deal in speciality order items Continuous Flow Model offers stability in high demand market but with little fluctuation Custom Configured Model provides custom configurations at production and assembly level Efficient Chain Model is for businesses that are in competitive markets and end to end efficiency is a must Fast Chain Model is for businesses with products that are trendy and have a short life cycle Flexible Model provides the freedom to meet high demand peaks and manage long periods of low volume movement Supply Chain Operations Reference SCOR Model is to assess waste, establish standards and continuous improvement in the SCM system For strategic decision-making, one of the most promising models is the SCOR Model.

Top-level has defined scope and content for supply chain 2. Companies always try to match supply with aggregate demand by developing a course of action using analytics.