One article to understand: What is supply chain management? What are the core of supply chain management?
1. What is a supply chain?
Although "supply chain" is a new term that has only come out in recent years, it is a function that has existed since ancient times. If we want to do business, whether it is manufacturing aircraft or selling tea eggs, we must have research and development, procurement, production, logistics and sales. As long as we have these functions, the business can be turned around and industrial logistics can be formed. As long as You can make money with low entry and high exit.
However, with the development of the business, the scale of the enterprise is getting bigger and bigger, the business is becoming more and more complex, and the operating cost is getting higher and higher. The business owner began to ask all departments to do their job well, and the cost of procurement, production and logistics should be reduced. , sales need to sell more goods, research and development need to develop more new products. Under the leadership's call, purchasing in order to save costs in bulk purchases, production in order to save costs in mass production, logistics in order to save costs must be fully loaded and shipped, sales in order to sell more goods can not accept out of stock, research and development are constantly developing new products . After everyone fought their own way, it was discovered that the performance of the department was good, but the company was not making money.
Because of inaccurate forecasts, conflicts between production and sales broke out, because there were too many products, conflicts between production and research broke out, and because there were too many products, conflicts broke out between R&D and sales. The sales of some companies think that the shortage is very serious, but the manufacturing tells the sales that the inventory fulfillment rate is close to 99%, and I don’t care if it is shipped or not. The logistics told the sales that the on-time delivery rate was as high as 99%. I delivered all the goods, and I didn't care if there were any goods.
Having said so much, I tell you a truth. Even if everyone does their best, it does not mean that the overall interests are maximized. Procurement and production do need to consider the issue of economic batches, but how large is appropriate, otherwise how to balance inventory or freshness? It is true that sales should increase the delivery rate, but to what extent is it appropriate, and how much is the cost behind the high delivery rate? Products do need to be updated, but what is the positioning of each product? How to connect the front and back ends?
The supply chain management is to optimize the production and circulation process of an enterprise, around the core enterprise, and link the involved raw material suppliers, manufacturers, distributors, retailers and end users through upstream and downstream member links to form a network chain structure. That is to say, as long as there is sales, procurement, and production, logistics will form a closed loop of physical logistics, which is the supply chain, so express delivery is also the last mile of the supply chain.
2. What is supply chain management?
Supply chain management is a management method for managing the entire supply chain system.
The purpose of implementing supply chain management is to shorten the cash turnover time, reduce the risks faced by enterprises, achieve profitable growth and provide predictable income. The main content of supply chain management is divided into five parts, planning, procurement, manufacturing, distribution, and return. During the management process, attention should be paid to emphasizing core competitiveness, external use of resources, and cooperative competition.
In layman's terms, supply chain management refers to the effective organization of suppliers, manufacturers, warehouses, distribution centers and distributors in order to minimize the cost of the entire supply chain system under the condition of meeting a certain level of customer service. Together, to manage the product manufacturing, transshipment, distribution and sales.
From another point of view, supply chain management is to coordinate internal and external resources of the enterprise to jointly meet the needs of consumers. When we regard the enterprises in each link of the supply chain as a virtual enterprise alliance, and regard any enterprise as the A department in the alliance, the internal management of the alliance is supply chain management. It's just that the composition of the alliance is dynamic and changes at any time according to market needs.
For the entire supply chain system, the implementation of supply chain management is mainly to shorten the cash turnover time, reduce the risks faced by the enterprise, achieve profit growth, and provide predictable income.
3. What does supply chain management include?
The content of supply chain management mainly includes five parts:
1. Plan
This is a strategic part of supply chain management. You need to have a strategy to manage all the resources to meet customer demand for your product. A good plan is to establish a series of methods to monitor the supply chain so that it can effectively and cost-effectively deliver high-quality and high-value products or services to customers.
2. Purchasing
Select suppliers who can provide goods and services for your products and services, establish a set of pricing, delivery and payment processes with suppliers and create methods to monitor and improve management, and integrate the management process of goods and services provided by suppliers This includes picking up the goods, verifying the manifest, forwarding the goods to your manufacturing department and approving payment to suppliers, etc.
3. Manufacturing
Arranging the activities required to produce, test, pack, and prepare for delivery is the most measured part of the supply chain, including measures of quality levels, product yields, and worker productivity.
4、Shipping
Also known as logistics, it is to adjust the user's order receipt, establish a warehouse network, send delivery personnel to pick up the goods and deliver them to customers, establish a product pricing system, and receive payment.
5. Return
This is the problem handling part of the supply chain. Establish a network to receive defective and excess product returns from customers, and provide support when customers have problems with their application products.
4. What is the core of supply chain management?
1. Emphasize core competitiveness and reflect "horizontal integration". To this end, it is necessary to clearly identify the core business of the enterprise, and then pay close attention to core resources to improve core competitiveness.
2. External use of resources (i.e. business outsourcing, Outsourcing), non-core business is outsourced to business partners, and strategic alliances are formed with business partners.
3. Cooperative competition. In the past, competitors form alliances with each other to jointly develop new technologies and share results; outsource non-core parts produced by the company to suppliers in the past, and the two parties cooperate to participate in the competition.
4. Service-oriented management with customer satisfaction as the goal. For downstream enterprises, the function of upstream enterprises in the supply chain is not simply to provide materials, but to provide the best service at the lowest cost.
5. The integration of logistics, information flow, capital flow, etc., emphasizing that these flows must be integrated. Only when cross-enterprise process integration is achieved can the goal of coordinated operation of supply chain enterprises be achieved.
6. Realize management goals with the help of information technology, which is a prerequisite for information flow management.
7. Pay more attention to the participation of logistics enterprises. The role of logistics is particularly important, because shortening the logistics cycle is more critical than shortening the manufacturing cycle.