Discussion Notes on Supply Chains

Discussion Notes on Supply Chains

A supply chain consists of all organizations, facilities, functions, and activities involved in producing a product or providing a service.

The basic components of supply chain management are strategy formulation, procurement, supply management, demand management, and logistics management. The key issues in supply chain management relate determining the appropriate level of outsourcing, managing procurement, suppliers, customer relationships, risk and being able to quickly identify problems and respond to them. The goal of supply chain management is to effectively and efficiently manage supply and demand.

(Adapted from Stevenson, ‘Operations Management’ 11th ed, McGraw‐Hill, 2012, pp 694).

Supply Chain: Definitions and concepts

The sequence of organizations ‐ their facilities, functions, activities ‐ that are involved with producing or delivering a product or service.

Sometimes referred to as value chains

(Stevenson, Operations Management, 9th edition, 2007)

In other words.......

A network of firms organized to design products, secure raw materials, convert them into products and deliver them to customers within predefined financial and operational constraints.

However.......

That portion of the supply chain which comes after the manufacturing process is sometimes known as the distribution network

The processes from the initial raw materials to the ultimate consumption of the finished product linking across supplier‐user companies.

The functions within and outside a company that enable the value chain to make products and provide services to customers (APICS Dictionary, 11 edition, 2005)

The global network used to deliver products and services from raw materials to end customers through an engineered flow of information, physical distribution and cash

(APICS Dictionary, 12 edition, 2008)

Supply Chain Management

Supply chain management has assumed different faces in different fields Organizational theory

Interorganizational relationships Purchasing management

Professional discipline of managing suppliers

Discussion Notes on Supply Chains 1



Logistics management

Focus on the flow of goods through the supply channels

Transaction cost