Supply Chain Management (SCM)

Supply Chain Management (SCM) refers to the integrated process of managing the flow of goods, services, and information from the initial suppliers to the final customers. It encompasses the planning and management of all activities involved in sourcing, procurement, conversion, and logistics management. SCM aims to optimize operations to maximize customer value and achieve a sustainable Competitive Advantage.

Examples of Supply Chain Management include:

• A large retail chain using SCM software to manage Inventory levels across multiple locations, ensuring products are Stocked according to demand forecasts.
• A manufacturing company coordinating with suppliers and distributors to reduce lead times and minimize costs while maintaining product quality.
• A technology company implementing a just-in-time (JIT) approach to ensure components arrive precisely when needed for assembly, reducing excess Inventory.

Cases illustrating SCM impact:

• The case of Dell’s build-to-order model, which effectively managed its Supply Chain to customize products for customers while minimizing excess Inventory.
• The response of Walmart to the COVID-19 pandemic, utilizing its SCM capabilities to adapt to rapidly changing supply and demand conditions.