The History Of Supply Chain Business Essay


Supply chain is the use of arts and sciences that how company transformed its raw material to the finished goods and then this final material then moved to consumers. In other words it is the path through which goods are transformed from its basic form to the end user. Supply chain also involves the moving of services and products from the supplier to the customer. Supply chain involves the all direct and indirect parties fulfilling the customer's request. (Cox, 1999) The paths which are usually involved in this process are supplier, manufacturer, dealer, intermediaries, retailer and customer. The objective of the supply chain is to make it profitable and this can be done by knowing the key values of supply chain. Supply chain profitability is also called as supply chain surplus it can be achieved by splitting the profits alike, it can also be achieved through the good relation between stakeholders. The integrated planning is the essence of the supply chain management. This includes the useful and practical planning of actions within the organization, organization and its customers, vendors, etc. a good supply chain makes everyone contented. The functions of the supply chain include new product development, distribution, finance, marketing operations and customer service. This is the dynamic chain and also involves the flow of information funds and products between different stages.

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For example when the customer wants to purchase the Hewlett Packard computer online the supply chain includes, the customer, HP website that takes the customer order, the HP assembly plant and all of the HP suppliers and their suppliers. Customer gets the information regarding pricing, product variety and the product availability through the website. After selecting the product the customer checks the status of order through the website. Stages further involve the taking up the customer's order and fulfilling it. This involves a various flow of information and the funding that takes place at different stages of supply chain.

This example shows that the integral part of the supply chain is customer. In a process of generating profits the primary purpose of every firm is to satisfy customers need. The supply chain starts by taking the order from the customer and ends by satisfying the customer for his purchase. The supply chain involves the movement of product from the suppliers to the manufacturers to the distributors then to retailers and finally at the end to the customer. (Barratt, 2004) Visualizing the flow of information, funds as well as product in both the directions of this chain is important. In supply chain, at every stage one player is essentially involved. Actually a manufacturer receives the material from different suppliers and then supplies it to several distributors. Customers, retailers, wholesalers or distributors, manufacturers and raw material suppliers are included in the stages of the supply chain. The basic design of the supply chain depends upon the customer's need and the role of the stages that are involved in fulfilling the customers need. Following are the five basic and unique components of the supply chain:






PLANNING: The strategic portion of the supply chain management is the planning. To meet the demands of the customer for the product or services, the company needs to manage and plan its resources.

SOURCE: to deliver the goods and services for making the product companies chooses the suppliers. Therefore a set of pricing strategy, delivery and process of payment is decided by the supply chain managers to make a good relation with the suppliers.

MAKE: this is the manufacturing stage of the supply chain. The activities necessary for the production, testing, packaging and delivery are decided by the supply chain managers.

DELIVER: supply chain managers develop a strategy to deliver the final product to the customer. This is the logical part of the supply chain, here the managers coordinate with the receipts that are made for the orders of the customers and also make an invoice system to receive payments from customers.

RETURN: for many companies this is the problematic part as supply chain managers have to manage the products that return the customer in case of any damage or defects. Therefore a flexible strategy should be developed in order to support the customers that have problems with the delivered products. (Hoole, 2005)

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Modeling is also an important tool for managing and understanding the supply chain. To achieve a good supply chain mangers should understands the uncertainty between customer and supply chain, they should also understands the capabilities of the supply chain and achieved the competitive as well as the supply chain strategies. For understanding the customer, managers must understands the customer demanded attributes that are; quantity demanded by the customer, time taken by the customer to give the acceptable response, suitable price, variety of product and level of service that is requires. Al of these attributes is represented by the implied demand uncertainty. This can be achieved by maintaining the proper balance between efficiency and responsiveness, by focusing on globalization and using new technologies. Sometimes push and pull strategies can also be used in the supply chain push strategy means to push the product to the customer and pull strategy means that the customers pulls the good from suppliers in the path between supplier to customer where you should place the customer; s order defines the push or pull strategy.(New,1997).


Supplier ----------Order -----------------------Customer


Additionally, I also found information regarding the models used by corporations like forecast-distribution models to have the correct inventory that is required to encounter variations in patron demand. Such models help corporations uphold more effectual and consequently more operative supply chain management approaches. Under this model, partakers in the junior end of the supply chain, as compared to those who are adjacent to the patron, upsurge their orders more often when there is an increase in demand. On the other hand, when there is a diminution in demand, they cut or halt their orders to avert unnecessary inventory. It is a fact that today's corporate climate has promptly altered and has turned out to be more tough as ever in nature. The corporations now not only necessitate operating at a lesser cost to contend, it must also advance its own fundamental capabilities to differentiate itself from participants and stand out in the marketplace. In my view, the corporations need to avert its possessions to concentrate on what they do preeminently and outsource the procedure and chore that is not significant to the overall goal of the corporation.

During the discussion with my peers, I found that SCM has permitted corporation to reconsider their complete process and reorganize it so that they can concentrate on its central proficiencies and subcontract practices that are not within the primary capabilities of the business. Furthermore, due to the existing competitive marketplace, it is the only technique for a corporation to persist. The approach on smearing SCM will not only influence their marketplace standing but also strategic verdict on selecting the right associates, assets and manpower. In addition to that, the emphasis core aptitudes also will enable the corporation to form niches and specialty of central extents. According to my research, the simplification of supply chain needs to be appropriately applied to the precise condition to be most operative. It is imperative to select the suitable methods with the utmost influence. It has also been deliberated that implementing the broad administration of a supply chain is no tranquil task, but as soon as it has been executed, every individual and corporation within the chain benefits significantly.