A part of Supply Chain Management

1. Modi_Yash_SCM_wrd01
Supply Chain Management
Introduction To The Supply Chain Management
By: Yash Modi(5276724)
Date: 5th
February, 2020
The management, planning, implementing, integrating, and controlling of the activities that
includes of physical, financial, and information networks that move the materials, funds,
and related information through the full logistics process..... from acquisition of raw
materials to delivery of finished goods And services to the end users. In other words: it is
the planning and management of all activities involved in sourcing and procurement,
conversion, and all logistics management activities
The process of SCM begins and ends with Customers1
OR
1 Image taken from: https://www.systra-tech.com/supply-chain-management/

2. 2
The four elements of Supply Chain Management are;
 Supply Management
 Operations
 Logistics
 Integration
 Supply Management
Supply management is the act of identifying, acquiring and managing the resources and
suppliers(it may also have multiple-tier suppliers) that are essential to the operations of an
organization. Also0 known as Procurement. It includes purchasing of physical goods,
information, services and other resources that enables companies to do their day to day
operations .
That means cost control, time management, risk management, allocation of resources, et
cetera.
Whatis Procurement?
The main element of supply management is procurement----it is the activity to acquire
something.
Purchasing is a part of procurement.
There are two types of procurement and they are
 Sourcing
Sourcing is finding the most appropriate suppliers at the best price.
For example: Toyota
 Outsourcing
CUSTOMERS PLANNING PROCUREMENT MANUFACTURING
INVENTORYMANAGEMENTWAREHOUSE MANAGEMENTTRANSPORTATION
CUSTOMERS

3. 3
The act of moving a firm’s internal activities and decisions responsibility to outside
providers.
For example Walmart
How much to order?
To decide howmuchto order,an organizationneedsthe datalike;
 Orderingcost(S)
 Annual demand(A)
 Holdingcost(C)
 Unit cost(I)
Whento order?
To calculate whentoorder,an organizationneedsthe EOQdata+ leadtime+safetystock(withstock
outs).Inotherwords,we needto calculate the ReorderPoint(ROP):
ROP=(A*LeadTime)+safetystock
To findEconomicOrder
Quantity(EOQ) =Q=c)