Supply chain management (SCM) is the integrated planning, management, and monitoring of all processes along a company’s value chain. This chain includes all steps from the procurement of raw materials to the delivery of the final product to the consumer. The goal of SCM is to maximize the efficiency and effectiveness of the entire supply chain and optimize the production process.
Why is supply chain management important?
Important aspects of SCM include the planning, procurement, manufacturing, delivery and return of materials and products. The main tasks include:
Planning and management of resources: This includes the management of materials and spare parts.
Procurement: Selection and management of suppliers and contract management.
Manufacturing: Efficient planning and control of production processes.
Delivery: Planning and monitoring warehousing strategies, transportation and distribution.
Returns and complaints: An established network for taking back faulty or surplus products, such as single or double swap.
The just-in-time (JIT) principle, which has increasingly become the industry standard, promotes a pull principle in which fluctuations in demand have a direct impact on production, which can cause the bullwhip effect.
Use of software in SCM
The use of software in supply chain management is crucial to increasing efficiency across all processes. Software helps companies to have the right inventory in the right place at the right time while minimizing costs.
Inventory management: Software can improve inventory accuracy, increase responsiveness, and prevent picking errors.
Demand forecasting: Software can be used to more accurately estimate future customer demand based on sales histories, enabling better production planning.
Automated order management and scheduling: Software solutions optimize the entire order process and transportation efficiency, reducing costs and improving customer service.
SERVICE 1 software integrates all these modules, providing a holistic solution for effective supply chain management.