Importance of Supply Chain Management

Supply chain management is a comprehensive process that starts from the raw materials and the inbound logistics all the way to the outbound logistics and taking the idea on the table. Without an efficient supply chain management function, organizations across industries face bottlenecks. Moreover, supply chain management is essential to organizational success and customer satisfaction as it includes all the activities that lead to the success of an organization. This includes planning, management of all activities and operations, the transport, inventory management, and warehouse management, and marketing operations of suppliers, service providers, and clients.

5 Functions of Supply Chain Management

Supply chain management upholds the balance between the supply and demand and includes activities right from procurement of resources and converting them into finished goods to guaranteeing delivery at the right time to reach the end-user. Also, a streamlined supply chain management process can augment customer relationship and lower down operational costs. Here are five functions of supply chain management:

Purchasing: Purchasing refers to procuring raw materials and other resources to manufacture the end products.

Operations: The operation team involves in demand planning and forecasting. Moreover, the organization must anticipate the possible market demand and the number of units it needs to produce.

Logistics: This function of supply chain management necessitates immense coordination. This is where the manufacturing of products has commenced.

Resource Management: This phase decides the allocation of resources in the right activity at the right time to enhance the production at reduced costs.

Information Workflow: Information distribution and sharing are what really keeps all other functions of supply chain management on track.

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