Seven misunderstandings of supply chain management
BY AMT Liu Yu compiled
Supply chain management is a very broad term, often easily misunderstood, in many different opinions, have not been completely explained yet.
What is supply chain management, supply chain management is defined as a synergy strategy, the goal is to integrate upstream and downstream operations to eliminate non-value costs, infrastructure, time and behavior to compete for end customers better. Service.
In order to show what SCM is and nothing, the following will clarify some of the most common misunderstandings;
Misunderstorm 1: Supply Chain is a scam
That is, old concept new packaging. Due to IT technology, SCM's practice is growing rapidly within the past 10 years. The speed of PC is rapidly improved, communication, data management software's ability and variability improve new practices, strategies, strategies and applications. In fact, all industries, such as VMI (vendor management stock) warehousing and collaborative planning, prediction, supplementary (CPFR) strategy, and the potential of collaborative supply chain management simultaneously.
Misunderstanding 2: SCM is synonymous with logistics management
The essence of supply chain management is the integration planning of operation, strategy and strategy. Such planning requires all activities and processes, such as customer orders, procurement behaviors, integrated manufacturing resources, optimal planning and logistics enterprise, end-to-end integration. Finally, SCMs should integrate key business operations and the operational relationships on the supply chain.
However, logistics (definitions in Council of logistics) are part, planning, implementation, and control of goods, services, and information in accordance with customer requirements from source to delivery from source to delivery from source to delivery.
Misunderstanding 3: SCM is the only requirement for companies to get competitiveness
This is obviously wrong. In order to truly competitive, the company needs a strong business vision, clear definition mission, product marketing plan, planning a good strategy (such as supply chain strategy and "waterfall" operational strategy).
Misunderstanding 4: SCM is about supply management
Supply management only on procurement and supplier management. The SCM is about the entire end-to-end flow from raw materials to the final consumption, as well as the integration of supply and demand.
Misunderstanding 5: Supply Chain No Value Chain Management (VCM) Important
Value Chain Management Examines the supply chain from the angle of value increase. Obviously this is a very important angle. However, there is no SCM's concern about integration, and value chain analysis may lack the necessary structures and cannot achieve ultimate goals. In effect, SCM and VCM are complementary.
Misunderstanding 6: SCM is a cluster supplier.
This point is only correct at some point. If "a cluster" refers to a group of companies working together with a common goal, the supply chain partner is of course the horizontal cluster of the value-added supplier. However, SCM exceeds the traditional definition of clusters, and traditional views restricts companies in the same industry or physical location. If each of the vendors in the chain increases the value of the overall network cluster, further development of supply chalp clusters will result in end customers more profitable.
Misunderstanding 7: SCM is equivalent to implementing ERP
The supply chain focuses on end-to-end integration. However, ERP focuses on integrated all application system transactions and becomes a corporate range system. Therefore, ERP focuses on internal channel integration, as well as the management information required for enterprise scope decision support. Many ERP implementations actually not support the supply chain to the process and integrated, because they lack a well-defined operational improvement plan.
