Supply Chain Management

Supply Chain Management

It requires commitment from all the supply chain partners coordinate effectively in terms of order generation, order fulfillment, therefore, creating an enterprise that is beyond just the producer’s site.Many large organizations that have both a local and global presence have recently begun to understand the strategic importance of the supply chain. One of the biggest examples of supply chain integration and its importance to the organization is when Wal-Mart started business in Japan in 2002. Wal-Mart entered the market when the economy of Japan was doing poorly with household income falling by 1.4 percent. At a time when the customers required quality goods and low prices, being able to cut the middlemen from the long distribution chain became essential for Wal-Mart so that they could transfer some of these cost savings on to the customers. By reducing the number of middlemen, they were planning to increase their margins and ease the cost burden on the consumers. This shows how strategically important once the supply chain can be. (Case Study, Hodgettes,1991)One of the major goals of supply chain management is to reduce the inventory assuming that products should be available when needed. Supply chain management has become really important these days because this global environment has become highly competitive. Especially for manufacturing industries like coco-cola, this is important because it allows the company to get a competitive edge through its core competencies. Also, supply chain management gives the value advantage to the company and not just production advantage as it gives a differential plus competitive offering. The six rights of logistics are important in order to have an effective supply chain management. These include providing the right product, in the right quantities, in the right condition, to the right place, at the right time,for the right cost.

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