Overview of Supply chain management

Supply chain management (SCM) is the management of a network of interconnected businesses involved in the provision of product and service packages required by the end customers in a supply chain. Supply chain management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption.

Supply chain management is the control of the supply chain as a process from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management does not involve only the movement of a physical product through the chain but also any data that goes along with the product (such as order status information, payment schedules, and so) and the actual entities that handle the product from stage to stage of the supply chain. 

There are essentially three goals of SCM:

•  To reduce inventory

•  To increase the speed of transactions with real-time data exchange,

•  And to increase revenue by satisfying customer demands more efficiently.
  
  
  
  
  
  
  WHAT IS BASIC COMPONENT OF SCM?
  
  
  
  
  As per Supply-Chain Operations Reference-model  which has been developed by Supply-Chain Council. This model organized and focused on the five primary management
  
  
  1.      PLAN
  2.      SOURCE
  3.      MAKE
  4.      DELIVER
  5.      RETURN
  
  
  1. Plan: This is vital part of SCM philosophy, where the companies normally need to make strategy for managing all the resource that go towards fulfilling the customer demand for the product and services that they offers. A big piece of planning is developing a set of matrices to monitor the Supply chain so that it would be efficient, cost effective and deliver high quality and value to the customer.
  
  
  2. Source: It means processes that procure goods and services to meet planned or actual demand. This part of SCM consists of selecting right suppliers that will deliver the good and services that need to create your product. Developing a set of pricing, delivery and payment process with supplier is important. Also this will also take care of managing the inventory of goods, and services you receive from your suppliers, including receiving shipping, verifying them, transferring them into various facilities and authorizing supplier payment.
  
  
  3. Make: This is basically a step where your company starts fulfilling the request or BUILT for products into finished state to meet planned or actual demand. Schedule activity necessary for production, testing, packaging and preparation for delivery.
  
  
  4. Deliver: This is also called Logistic Process. This is the processes that provide finished goods and services to meet planned or actual demand, typically including order management, transportation management, and distribution management.
  
  
  5. Return - This is real pain of SCM model, which defined as processes associated with returning or receiving returned products for any reason.