Supply Chain Management

SAN MATEO MUNICIPAL COLLEGE
General Luna St., Guitnang Bayan I, San Mateo, Rizal

Tel. No. (02) 997-9070
www.smmc.edu.ph
INVENTORY MANAGEMENT
AND HUMAN RESOURCE MANAGEMENT
OPERATION MANAGEMENET
Presented by
Agudes, Japhet
Camposano, Jeremy
Cruz, Maureen Andrea
Decena, James Bon
Matore, Jerald
BSA II
Presented to
Rey Salvador,
Faculty In-Charge
November 2019
The Need to Manage the Supply Chain
First what is SUPPLY CHAIN?

A supply chain is a network between a company and its suppliers to produce
and distribute a specific product to the final buyer. This network includes different
activities, people, entities, information, and resources. The supply chain also
represents the steps it takes to get the product or service from its original state to
the customer.
Supply chains are developed by companies so they can reduce their costs
and remain competitive in the business landscape.
Supply chain management is a crucial process because an optimized supply
chain results in lower costs and a faster production cycle.
These and other issues now make it clear that management of supply chains
is essential to business success. The other issues include the following:
1. The need to improve operations.

During the last decade, many organizations adopted practices such as lean
operation and total quality management (TQM). Opportunity now lies largely with
procurement, distribution, and logisticsthe supply chain.
2. Increasing levels of outsourcing.
Organizations are increasing their levels of outsourcing, buying goods or services
instead of producing or providing them themselves. As outsourcing increases,
organizations are spending increasing amounts on supply-related activities
(wrapping, packaging, moving, loading and unloading, and sorting).
3. Increasing transportation costs.
Transportation costs are increasing, and they need to be more carefully
managed.
4. Competitive pressures.
Competitive pressures have led to an increasing number of new products,
shorter product development cycles, and increased demand for customization.
5. Increasing globalization.
Increasing globalization has expanded the physical length of supply chains. A
global supply chain increases the challenges of managing a supply chain. Having
far-flung customers and/or suppliers means longer lead times and greater
opportunities for disruption of deliveries. Often currency differences and monetary
fluctuations are factors, as well as language and cultural differences. Also, tightened
border security in some instances has slowed shipments of goods.
6. Increasing importance of e-business.
The increasing importance of e-business has added new dimensions to business
buying and selling and has presented new challenges.
7. The complexity of supply chains.
Supply chains are complex; they are dynamic, and they have many inherent
uncertainties that can adversely affect them, such as inaccurate forecasts, late
deliveries, substandard quality, equipment breakdowns, and canceled or changed
orders.
8. The need to manage inventories.
Inventories play a major role in the success or failure of a supply chain, so it is
important to coordinate inventory levels throughout a supply chain. Shortages can
severely disrupt the timely flow of work and have far-reaching impacts, while excess
inventories add unnecessary costs
Elements of Supply Chain Management

Supply chain management involves coordinating activities across the supply
chain. Central to this is taking customer demand and translating it into
corresponding activities at each level of the supply chain. The key elements of
supply chain management are listed in the table below. The first element,
customers, is the driving element. Typically, marketing is responsible for
determining what customers want as well as forecasting the quantities and timing
of customer demand. Product and service design must match customer wants
with operations capabilities.
Processing occurs in each component of the supply chain: it is the core of
each organization. The major portion of processing occurs in the organization that
produces the product or service for the final customer (the organization that
assembles the computer, services the car, etc.). A major aspect of this for both the
internal and external portions of a supply chain is scheduling.
Inventory is a staple in most supply chains. Balance is the main objective;
too little causes delays and disrupts schedules, but too much adds unnecessary
costs and limits flexibility.
Purchasing is the link between an organization and its suppliers. It is
responsible for obtaining goods and or services that will be used to produce
products or provide services for the organization s customers. Purchasing selects
suppliers, negotiates contracts, establishes alliances, and acts as liaison between
suppliers and various internal departments.
ELEMENT TYPICAL ISSUES

Customers Determining what products and/or
services customers want.
Forecasting Predicting the quantity and timing

of customer demand.
Design Incorporating customers, wants,

manufacturability, and time to
market.
Capacity planning Matching supply and demand.
Processing Controlling quality, scheduling

work.
Inventory Meeting demand requirements

while managing the costs of
holding inventory.
Purchasing Purchasing Evaluating potential

suppliers, supporting the needs of
operations purchased goods and
services
Suppliers Monitoring supplier quality, on-

time delivery, and flexibility;
maintaining supplier relations.
Location Determining the location of
facilities.
Logistics Deciding how to best move

information and materials.
Location can be a factor in a number of ways. Where suppliers are located

can be important, as can location of processing facilities. Nearness to market,
nearness to sources of supply, or nearness to both may be critical.
Two types of decisions are relevant to supply chain managementstrategic

and operational. The strategic decisions are the design and policy decisions. The
operational decisions relate to day-to-day activities: managing the flow of material
and product and other aspects of the supply chain in accordance with strategic
decisions. The major decision areas in supply chain management are location,
production, distribution, and inventory.
The location decision relates to the choice of locations for both production
and distribution facilities. Production and transportation costs and delivery lead
times are important.
Production and distribution decisions focus on what customers want, when
they want it, and how much is needed. Outsourcing can be a consideration.
Distribution decisions are strongly influenced by transportation cost and
delivery times, because transportation costs often represent a significant portion of
total cost. Moreover, shipping alternatives are closely tied to production and
inventory decisions.
Operational decisions focus on scheduling, maintaining equipment, and
meeting customer demand. Quality control and workload balancing are also
important considerations.
Inventory decisions relate to determining inventory needs and coordinating
production and stocking decisions throughout the supply chain.
Logistics management plays the key role in inventory decisions.

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What are the elements of supply chain management?

What are the elements of supply chain management?

What are the major decision areas in supply chain management?

What are the major decision areas in supply chain management?

SAN MATEO MUNICIPAL COLLEGE

General Luna St., Guitnang Bayan I, San Mateo, Rizal

Cruz, Maureen Andrea

Decena, James Bon

The Need to Manage the Supply Chain

First what is SUPPLY CHAIN?

1. The need to improve operations.

Elements of Supply Chain Management

ELEMENT TYPICAL ISSUES

Forecasting Predicting the quantity and timing

Design Incorporating customers, wants,

Capacity planning Matching supply and demand.

Processing Controlling quality, scheduling

Inventory Meeting demand requirements

Purchasing Purchasing Evaluating potential

Suppliers Monitoring supplier quality, on-

Logistics Deciding how to best move

Location can be a factor in a number of ways. Where suppliers are located

Two types of decisions are relevant to supply chain managementstrategic

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Two types of decisions are relevant to supply chain managementstrategic