Supply Chain Management: Meaning, Partners and Process Management YouTube Lecture Handouts

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Supply Chain Management: Meaning, Partners and Process Management


  • It is a network created among various partners involved in supplying, manufacturing, or distributing the goods and services.
  • The main aim is to carry every function effectively and efficiently so that it reaches concerned parties on time and thereby organizational objectives are achieved.

Objectives of SCM

  • To maximize the overall value: The supply chain profitability is the difference between the amount paid by the consumer to buy the product and the cost incurred by the organization to produce and supply the good to the consumer. So, if it is more, then value improves.
  • Shortening the time to order: it aims to reduce the time required for ordering and fulfilling the same i.e.. , the time required to get the raw materials and also the time taken to make it available to the customer.
  • Better Distribution: Marketer or distributer can achieve and optimized level of distribution by utilizing all available resources properly.
  • Better Decision making: It is natural that when one knows how to reduce cost and at the same time making and getting timely delivery of raw materials and goods, the decision decisions would be considered good and beneficial for the organization

Partners Involved

  • Suppliers: They are the partners who supply the raw materials or components to the manufacturing location i.e.. , all the parties involved in making the basic components and raw materials available on time at the destination of their production
  • Manufacturers: IT implies the owners of the production unit. They play a major role as it is only after the production of goods, that they can be handled to the logistics management companies
  • Distributors: They are all those partners who further distribute the goods or sell them on their own to the customers.
  • Retailers: They are the ones involved in selling the goods directly to the customers for actual consumption. So, they in direct contact of the customers and therefore come as a last part in the supply chain management
  • Logistics Partners: These are the companies which are involved in either transporting or storing the goods. They move good between the parties. They play a predominant role in the whole process because it through their efforts that goods reach on time and even are safe in the warehouses they provide.

Process of Supply Chain Management

  • Planning: Here, a manufacturer plans how and from whom they will be receiving the raw materials, who will be the logistics partners, the one՚s who will be distributing the good also the time frame of the entire supply and delivery process.
  • Sourcing: After the planning, it is important to select the suppliers. Here, the priority is given to the time and cost which the supplier takes while making the raw materials available
  • Making: At this stage actual manufacturing of the goods take place. After the supplier and logistics companies send the raw materials, the process of manufacturing starts.
  • Delivering: Here the various logistics partners are chosen, and they have the responsibility of storing and transporting the goods to the required location. Apart from these, the distributers are also identified and again the cost i.e.. , the commission charged from them is taken into consideration
  • Return: It is network created to receive a returned product if it is not up to customers expectation and this is simply known as reverse supply chain management. Ecommerce companies like Flipkart and Amazon are carrying this effectively.


A supply chain does not include?

1. Supplier

2. Shareholders

3. Logistics partners

4. Manufacturers

Answer: 2

Which among the following is not the objective of SCM or Supply Chain Management?

1. Reduce cost

2. Save time

3. Take more time

4. Satisfaction of customers

Answer: 3

✍ Manishika