Features & Components of Supply Chain management - E-Commerce | E-Commerce - B Com PDF Download

FEATURES OF SUPPLY CHAIN MANAGEMENT

In electronic commerce, supply chain management has the following features::

• An ability to source raw material or finished goods from anywhere in the world
• A centralized, global business and management strategy with flawless local execution
• On-line, real-time distributed information processing to the desktop, providing total supply chain information visibility
• The ability to manage information not only within a company but across industries and enterprises
• The seamless integration of all supply chain processes and measurements, including third-party suppliers, information systems, cost accounting standards, and measurement systems
• The development and implementation of accounting models such as activity based costing that link cost to performance are used as tools for cost reduction
• A reconfiguration of the supply chain organization into high-performance teams going from the shop floor to senior management.

COMPONENTS OF SUPPLY CHAIN MANAGEMENT

Supply chain management (SCM) is the combination of art and science that goes into improving the way your company finds the raw components it needs to make a product or service and deliver it to customers. The following are five basic components of SCM:

• Plan – This is the strategic portion of SCM. You need a strategy for managing all the resources that go toward meeting customer demand for your product or service. A big piece of planning is developing a set of metrics to monitor the supply chain so that it is efficient, costs less and delivers high quality and value to customers.
• Source – Choose the suppliers that will deliver the goods and services you need to create your product. Develop a set of pricing, delivery and payment processes  with suppliers and create metrics for monitoring and improving the relationships. And put together processes for managing the inventory of goods and services you receive    from    suppliers,    including    receiving    shipments,    verifying them, transferring them to your manufacturing facilities and authorizing supplier payments.
• Make – This is the manufacturing step. Schedule the activities necessary for production, testing, packaging and preparation for delivery. As the most metricintensive portion of the supply chain, measure quality levels, production output and worker productivity.
• Deliver – This is the part that many insiders refer to as logistics. Coordinate the receipt of orders from customers, develop a network of warehouses, pick carriers to get products to customers and set up an invoicing system to receive payments.
• Return – The problem part of the supply chain. Create a network for receiving defective and excess products back from customers and supporting customers who have problems with delivered products.