is supply chain management hard

Demand-chain management (DCM) is the management of relationships between suppliers and customers to deliver the best value to the customer at the least cost to the demand chain as a whole. Generic Supply Chain. The simple answer to why SCM is important to any business is that it helps them remain competitive. hbspt.cta.load(3951034, 'e84dcc94-6e63-48f1-b2ac-0381ec9f447a', {}); 4 Ways to Make Your Supply Chain More Sustainable, Simple Strategies for Managing Your MRO Process, How to Optimize Your Supply Chain with Remote Monitoring, How Demand-Driven Planning Is Reshaping Manufacturing, Beyond Training: Closing the Skilled Labor Gap, Advances in the Analysis of New and Used Lubricating Oils by High-Resolution ICP-OES, How to Cost Justify a Lubrication Program, Use Lubricant Zone Inspections for Early Problem Detection. a risk management process that spans your supply chain, “Supply Chain Risk Management: A Compilation of Best Practices”. Why Supply Chain Management Is So Difficult…Reducing the Bullwhip Effect Name Module 2 SLP Instructor Date Introduction Businesses increasingly operate as supply chains, and companies need to manage customer, supplier and distributor relations across the supply chain (Disney, & … Business continuity plans are often focused on making a particular facility or company more resilient; supply chain risk management looks more broadly at how all of the companies working together contribute to the resilience of a supply chain. Wu said the supply manager playing an ever more important role in coordinating the process, which requires taking on multiple identities. A shipping container filled with raw materials for your product gets quarantined in a port for 30 days. SCM is the active management of supply chain activities to maximize customer value and achieve a sustainable competitive advantage. In the world of a supply manager, navigating the territory between their internal customers, the suppliers and the buyers is tricky. They attempt to integrate and optimize all the steps required to produce the right quantity of the correct product and deliver it to the customer within particular time parameters. In his new paper in the Journal of Business Research, Zhaohui Wu hypothesized that since research has shown that companies believe supply managers should have the ability to “wear many hats” and take on multiple roles as needed, that this ability would have a positive relationship with the manager’s interpersonal relationships. Reducing this vulnerability requires collaboration among the firms in a supply chain so that they can help one another deal with threats as they emerge. In the late 1990s, "supply-chain management" (SCM) rose to prominence, and operations managers began to use it in their titles with increasing regularity. As Wu’s paper points out, this is paradoxical and thus shows that being the middleman in a supply chain relationship is more complicated than ever. Supply chain managers may qualify for positions with an associate’s degree. SCM course will require you to complete statistics and quantitative research which involves mathematics and if that seems hard then it is hard. “Now, your supplier also has to trust you. He is lead author on the paper, which was written with Michelle D. Steward of Wake Forest University and Janet L. Hartley of Bowling Green State University. You can think about supply chain resilience in terms of a shipment of bananas bound from South America to a grocery store in the United States. You should deliver your products into a consumer’s hands as fast as you can. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third party service providers, and customers. Origins of Supply Chain Management. Salaries for those in SCM range from starting pay at 45k to 60k upwards of 200k for directors and executives. However, you don’t want to pay outrageous amounts to do that. Find out why supply chain management is so import to businesses today. In any event, it’s a good idea to have a supply chain plan for difficult times. To be in a business like this, they don't need to be talkative. All of these negotiations are part of the “many hats” that Wu says a supply chain manager wears. “Hard” is a relative term. The research shows that in some cases managers are successfully able to take on these different roles, but the trust between buyer and supplier can be affected. There is more time pressure to get the product, more focus on quality control, and managing the expectation of both the suppliers and your internal customers.”. It includes all processes that turn raw materials into final products. In fact, Wu’s in-depth interviews with 11 supply managers and their key contacts in eight diverse U.S. companies showed just the opposite: Suppliers believed that supply managers who excelled at these different roles were viewed in a more negative light by suppliers. In any event, it’s a … Either type of risk can lead to supply chain disruptions. Supply chain plans are built on assumptions about what will happen in the future, and these assumptions are usually based on past experience. Supply-chain management was then further defined as the integration of supply chain activities through improved supply-chain relationships to achieve a competitive advantage. According to me being in a supply chain management is not a tough job for an introvert. Many supply chain managers have a bachelor’s degree in business, industrial engineering, process engineering, or supply chain management. What attracted me to SCM was that I was in charge of logistics for a business venture I started in high school and I absolutely loved learning and experiencing it, as well as the vast opportunities. As the researchers point out, “Individuals depending upon their organizational position may perceive role-changing behavior differently.” The four roles the researchers identified are: a negotiator for the buyer, a facilitator between buyer and supplier, an advocate for the supplier, and an educator of internal customers. In the article Mr. Bean explains that Suppliers, manufactures, sales people, and customers have their own understanding of … Supply chain management (SCM) is the process that is used by a company to ensure that its supply chain is efficient and cost effective. Supply chain management involves coordinating and integrating these flows both within and among companies. Let’s look at two different examples of a supply chain. He said in today’s economy, the situation is even tougher, which is why more research is needed. Supply chain management skills can get broken into two categories: hard and soft skills. For example, if the transit time between one of your suppliers and one of your factories has always been 15 days in the past then you would assume that the transit time will be 15 days for future orders, too. Why is Supply Chain Management Important? Supply chain covers a lot of things: Sourcing, inventory management, production scheduling (for which it is best if you have an understanding of manufacturing), logistics, a little bit of trade,warehousing... so working in supply chain can involve any of those things. The generic supply chain begins with the sourcing and extraction of raw materials. Because this juggling of roles is an aspect of the modern managers, Wu said more research needs to be done to find out how managers can integrate their roles smoothly. 3. With a career in supply chain management, you can expect every day to be unpredictable—for better or for worse. Managing Your Supply Chain in Difficult Times, The Risk Management Process: Identifying, Classifying, and Scoring Risks in…, American Production and Inventory Control Society Certificates and Certifications, 10 Questions to Ask About Your Supply Chain. Supply chain management (SCM) is the active management of supply chain activities to maximize customer value and achieve a sustainable competitive advantage. Even so, it is typical for supply chain risk management processes to focus mostly on the downside risks. For example, a rapid increase in customer orders can trigger a buildup of inventory and overwhelm a distribution center. The Supply Chain Risk Leadership Council offers a free handbook called “Supply Chain Risk Management: A Compilation of Best Practices” that includes a list of all the different things that can go wrong in a supply chain. A key supplier files for bankruptcy protection. But the probability that a particular disease will start to spread may be 100 percent, if you knew that people were coming into direct contact with it. Supply chain management (SCM) is the management of the processes that control the flow of goods and services within an organization. Supply chain plans are built on assumptions about what will happen in the future, and these assumptions are usually based on past experience. A new customer unexpectedly places a huge order for your products. The disruption caused by an upside risk can be just as expensive as the disruption from a downside risk, especially when it triggers the Bullwhip Effect. “They questioned the sincerity of the manager, and the better that manager was at navigating between the roles, the more the supplier doubted his intentions.”. Supply chain management (SCM) is involved in every aspect of moving products to customers, from raw materials to super market shelves. But if the grocery store has extra inventory or another source of supply then it can continue selling bananas to its customers in spite of the supply chain disruption, so its supply chain is resilient. There is so much more to it than that. At the same time they may tell you, we’ve got an issue and now the product is going to be late, or perhaps they say they can rush delivery but it will cost more and the cost they quoted is more than your company wants to pay.”. If a threat occurs, it can cause a disruption. Supply chain management in not only a process served to generate a cost reduction in the budget or a mission to create greater operational efficiencies within an organization. The result would be a disruption in the ability of the distribution center to process shipments efficiently. “Or perhaps there are tools that can help form a coherent identity. From these risks and others, you see that the supply chain has many threats — many things that could go wrong. Supply Chain Management (SCM) is an important part of every organization, whether small or large. In many cases, the flexibility is cheap compared to the cost of a supply chain disruption. However, as logistics becomes increasingly complex, more companies prefer to hire workers who have at least a bachelor’s degree. The cognitive aspect is missing in supply chain research; in this paper we are just measuring the behavioral aspect. “Most of the time now, you are dealing with overseas companies, and price negotiation is just part of the job. He doesn't make great money but he likes what he does, and it wasn't too hard to find a job because he hopped around constantly after graduating till he found something he really liked. A supply chain’s vulnerability to disruptions can have serious consequences for all the businesses involved. For example, understanding new tech, cost accounting skills, e-business system knowledge and more are all valuable skills. Wolfe explains that supply chain is all about working together as a team, and when a team member is out or busy, you may find yourself stepping up to complete a task you’ve never done before. In other words, think of the cost of supply chain flexibility as though it were the premium on an insurance policy. Think about the potential effects that any of the following events could have on your supply chain: Each situation represents a scenario that supply chains around the world face every day, and your supply chain needs to be able to respond. “In the past, supply managers were largely seen as number crunchers, people who had to be good with negotiating contracts. Strictly speaking, risks can be either good or bad; there is a risk you might receive a big order, but there is also a risk that you could lose a customer. Demand-chain management is similar to supply-chain management but with special regard to the customers.. Demand-chain-management software tools bridge the gap between the customer-relationship management … While the idea of supply chain management is certainly as old as commerce itself, the term only dates to 1982, when British logistician and consultant Keith Oliver used in in when interviewed by the Financial Times. The raw materials are then taken by a logistics provider to a supplier, which acts as the wholesaler. If the ship breaks down, for example, it could delay the delivery of bananas and disrupt the store’s supply chain. These hard skills, or solid skills, relate to understanding the technology and processes associated with strong supply chain management. Supply chain management plays a critical role in running a successful business. “Maybe some of the supply chain managers are like George Clooney, just naturally good at smoothly navigating relationships, we don’t know,” Wu said. Wu, an associate professor in OSU’s College of Business and director of the college’s Sustainable Business Initiative, is an expert on supply chain networks and management. In this lesson, you'll learn about the benefits and best practices of supply chain management. Good risks, such as a big order, are called upside risks because they are related to growing your business; bad risks are called downside risks. When reading Bullwhip and Beer: Why Supply Chain Management is so difficult by Michael Bean we get and understanding of how hard being a supply chain manager can be. This typically is comprised of five stages: planning, development, manufacturing, logistics and returns. When supply chain management is effective, it can lower a company's overall costs and boost profitability. We outline a few ways that well-executed SCM can benefit your business or project. Keeps Businesses Competitive. A supply chain is the collection of steps that a company takes to transform raw components into final products and deliver them to customers. And in today's logistics labor market, negotiating a salary is in favor of the applicant. Not only does SCM touch on manufacturing, transportation and trucking, warehouse mana… In other words, relying on general statistics about how epidemics emerge can lead you to underestimate the risk for a particular disease. This is no longer the case.”. Supply chain risk management is very similar to business continuity management. You may find people using the words risk, threat, and disruption interchangeably, but in the context of supply chain management each of them means something slightly different. But past performance is not a guarantee of future results. Apart from these two rest are mostly knowledge based. “It’s a more cognitive, more sophisticated job than it was in the past,” he said. 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