Importance of Supply Chain Management
Without an efficient (SCM) supply chain management function, establishments across industries face roadblocks. As a result, supply chain management is considered as a comprehensive process that starts from the raw materials and inbound logistics all the way to the outbound logistics and putting down the idea on a table. Furthermore, SCM is crucial to an organization’s success and customer satisfaction as it embraces all the activities that lead to the success of the entire organization. This includes planning, operations, transport, inventory management, warehouse management, and marketing operations of service providers, suppliers, and clients.
5 Functions of Supply Chain Management
Supply chain management maintains the balance between the supply and demand and comprises of activities from procurement of resources and to guaranteeing delivery at the right time to reach the end-user. Similarly, a streamlined supply chain management process can enhance customer relationship and lower down operational costs. Let’s take a look at five functions of supply chain management:
Information Workflow: Information circulation and sharing is what really keeps all functions of supply chain management on track.
Purchasing: refers to obtaining raw materials and resources to manufacture the end products.
Resource Management: decides the allocation of resources in the right time to enhance production at reduced costs.
Logistics: is a function of supply chain that necessitates immense coordination. This is where the manufacturing of products has started.
SpendEdge provides actionable insights utilizing lean methodology to help establishments make better purchasing decisions. Our procurement market intelligence solutions assist industries in meticulously monitoring the supply market settings and understand the importance of supply chain management. Moreover, every business needs smart procurement intelligence to stay at the top of their game.
The client – is one of the leading companies in the set-top box industry. It also produces Smart TVs, DVD recorders, and AV receivers.
The smart TV manufacturer was planning to diversify its markets, production facilities, and suppliers. The company’s growth ambitions were being hampered by increasing supply chain network complexity and logistics costs. Additional storage of raw material, transportation, work in process, and finished goods were all increasing logistics costs.
With the help of SpendEdge’s supply chain management solution, the smart TV manufacturer fine-tuned their consolidation hub operation to eventually move into an everyday carry operation. This enabled tighter inventory control and aligned lead times with overseas manufacturing. Additionally, the client established container optimization and a certain range of value-added services and achieved savings of USD 300,000.