Strategic importance of supply chain management, Microeconomics

Strategic Importance of Supply Chain Management

This describes the scope of supply chain management (SCM), including the management of procurement, logistics and materials. It explains the importance of just-in-time ideas and techniques and discusses the evolution of the supply chain. Supply chain strategies including global supply chain issues and e-business are also covered. The key objective of supply chain management is to provide customer satisfaction by having the correct product in the correct place at the correct time. Competition worldwide is increasing. Creating customer satisfaction is important to most companies. The concept of satisfaction has multiple dimensions. These dimensions contribute to a feeling of overall satisfaction and are made up of considerations of: ?

  • cost - what customers receive for what they paid ?
  • convenience - the effort expended to achieve the purchase ?
  • confidence in the support services both included and promised

 

In an age of global markets, supplies and competition, the ability to satisfy and retain customer loyalty is no longer a simple marketing proposition. Back office operations are vital. Firms currently strive to increase competitiveness by providing customisation, value for money, quality and service. Customisation of the service component may for instance include speed to market or responsiveness to customer enquiries. Consider Amazon.com, which provides books selected from the internet store delivered to your door (within a stated time period). The marketing proposition is simple and based on convenience. The same product could be purchased from a bookshop. If the back-office operation of Amazon either takes six weeks to deliver the book once ordered, or fails to meet a promised delivery date, then the probability is that the customer would be dissatisfied. The same applies to FedEx with its delivery next day before 10am promise. Speed is becoming an important aspect of service provision. McDonald's controls its supplies along the entire length of its supply chain from meat purchasing and paper cups to 28,000 franchise outlets worldwide. 

For major companies operating in global markets, the stakes are high.

Managing the supply chain offers the capability to create and reach markets before competitors, and achieve competitive advantage by providing increased customer satisfaction through delivering the right product at the right time at greater value for money as a result of reduced overall cost. The purpose of operations is to support business strategy while the purpose of supply chain management is to support the operations strategy.

Posted Date: 3/14/2013 5:35:31 AM | Location : United States







Related Discussions:- Strategic importance of supply chain management, Assignment Help, Ask Question on Strategic importance of supply chain management, Get Answer, Expert's Help, Strategic importance of supply chain management Discussions

Write discussion on Strategic importance of supply chain management
Your posts are moderated
Related Questions
Economic Reforms and Reduction of Regional Disparities: Another important objective of development is to reduce regional disparities. Government has been helping the backward

Employer’s Estimates of Future Manpower Requirements One of the parameters of demand for employment in a firm or a factory or an establishment is the level of capital investme

Ask questiowhat are the importance of the branches of economics

Time Value of Money The time value of money is the price or value placed on time. It is commonly thought of as the opportunity cost related with a particular investment. Money

Surplus: Anysector or agent in economy (business, householdor government) experiences a surplus when its income surpasses its expenditure. Surplus, Economic: For the economy

shows teh steps in unitary mehod

What does the basic neoclassical, or traditional, model of economics assume about markets? It supposes that markets are perfectly competitive and smoothly functioning, and thos

how can draw the table and diagram of production function function with one veriable

A potential investment project has the following stream of annual social (benefits minus costs), where you may assume the project starts with the capital payment of $12,000 on Day

Use a graphical illustration to describe briefly what the influence of each of the following would be on the market supply of labor:(a) an increase in immigration (b) more women en