As the name suggests, it is the management of the flow of goods and services. It includes the processes that result in the transformation from raw materials into final products. Not only management is important but cutting excess costs is also very crucial in the processes undertaken whilst transforming raw material into products. An ideal or near-ideal supply chain management keeps the cost lower.
What are the five essential components of a Supply Chain Management System?
Plan: Planning is the most important component in management. Without planning no effective management can take place. Companies tend to make supply match with aggregate demand. Procuring exactly same what is planned is ‘Source’. Planning to produce adequate is ‘Make’ and attaining qualitative service levels by delivering on time is ‘Deliver’. It is suggested to be alert with a watchful eye, keeping demand variations in check.
Source: Once planning is done, it is really important to look out for the sources. Identifying suppliers who will meet actual demand in cost-effective ways. Suppliers have to meet certain standards and assure that only qualitative goods are delivered to the client. Sourcing is done for both perishable and non-perishable products.
Make: You are done with planning and sourcing, now you have to make the final product out of the raw material available. Assembling, testing and packing are the basic processes involved in this component. Simply speaking, the transformation of raw material into the final product takes place in this particular component. Feedback from consumers plays a significant role once the transformation is done. It helps the firm to improve the quality of the product.
Deliver: Now that product has been manufactured delivering makes a significant contribution to uplift the image of the firm in the market. If goods and services meet the expectations of the consumers, business turns lucrative. Seamless delivery of products is ensured via road, air, and rail.
Return: Comes last but not least, it is a post-delivery service that is delivered to consumers. Also known as ‘Reverse Logistics’, it is the customer support process that assists a firm in improving the quality of products once manufactured and delivered to the customers. It also helps a firm to build or improve relationships with customers, to build a sense of faith. The firm returns the low-quality and defective raw materials to the suppliers.
Effective management of the mentioned components is the crucial step in maintaining a good Supply Chain. Supply Chain Management Assignment Help Online aims to provide sufficient information on the five components of Supply Chain Management. Any organization must have an effective Supply Chain to anticipate problems, dynamically adjust prices and improve inventory and fulfillment. My Assignment Services sees efficient Supply Chain Management as a secret to the success of any organization. Poor supply chain management can lead to an unnecessary burden on the firm, delays in delivery, and quality-related issues.
Therefore, each component of supply chain management is as vital as breath for living.