DNYANSAGAR ARTS AND COMMERCE COLLEGE, BALEWADI, …

DNYANSAGAR ARTS AND COMMERCE

COLLEGE, BALEWADI, PUNE – 45

SUBJECT: SUPPLY CHAIN MANAGEMENT (302)

CLASS: SY BBA (III SEM)

Presented By:

Dr. Mayadevi Jadhav

Supply chain management is the management of the flowof goods and services and includes all processes that transformraw materials into final products. It involves the activestreamlining of a business's supply-side activities to maximizecustomer value and gain a competitive advantage in themarketplace.

Typically, SCM attempts to centrally control or linkthe production, shipment, and distribution of aproduct. By managing the supply chain, companiesare able to cut excess costs and deliver products tothe consumer faster. This is done by keeping tightercontrol of internal inventories, internalproduction, distribution, sales, andthe inventories of company vendors.

SCM is based on the idea that nearly everyproduct that comes to market results from theefforts of various organizations that make up asupply chain. Although supply chains have existedfor ages, most companies have only recently paidattention to them as a value-add to theiroperations

In SCM, the supply chain manager coordinatesthe logistics of all aspects of the supply chain whichconsists of five parts:The plan or strategyThe source (of raw materials or services)Manufacturing (focused on productivity andefficiency)Delivery and logisticsThe return system (for defective or unwantedproducts)

Objectives of SCMA well designed SC is expected to support thestrategic objectives of:-1. Solving supplier’s problems and beyond his level.2. Customer service performance improvement.3. Reduction of pre & post production inventory.4. Minimizing variance by means of activities likestandardization, variety reduction, etc.5. Minimum total cost of operation & procurement.6. Product Quantity control.7. Achieving maximum efficiency in using labour,capital & plant through the company

Unit-2Manufacturing and Warehousing

Manufacturing (Production)Scheduling

Scheduling is the process of arranging,controlling and optimizing work and workloadsin a production process or manufacturingprocess. Scheduling is used to allocate plant andmachinery resources, plan human resources,plan production processes and purchasematerials.

The benefits of production scheduling include:Process change-over reductionInventory reduction, levelingReduced scheduling effortIncreased production efficiencyLabor load levelingAccurate delivery date quotesReal time information

Workflow Automation

Material handling involves short-distancemovement within the confines of a building orbetween a building and a transportation vehicle.Ituses a wide range of manual, semi-automated, andautomated equipment and includes considerationof the protection, storage, and control of materialsthroughout their manufacturing, warehousing,distribution, consumption, and disposal. Materialhandling can be used to create time and placeutility through the handling, storage, and control ofwaste, as distinct from manufacturing, whichcreates form utility by changing the shape, form,and makeup of material.

Customer-Focused and Value-CenteredWarehousing StrategyTo keep pace with the moving target known ascustomer demand, companies need to buildflexibility into their warehouse operations so thatthey are ready to give customers whatever theywant, whenever they want it. In this competitiveenvironment, "product customization" has becomethe new focus and a critical function of modernwarehouses.

Consolidate Warehousing OperationsAfter decades of decentralizing, that is, setting upsmall regional warehouses close to local markets,many companies are discovering the economicadvantages of consolidating multiple warehousesinto a single large facility. Warehouse centralizationlowers the cost of operations because it reduces thenumber of facilities that a company needs to run aswell as the amount of inventory it needs to carry.

Create a Flexible Warehouse DesignIn recent years, many leading practice companieshave been particularly keen on exploring new designsthat build flexibility into warehouse operations.Built-in flexibility allows warehouses to make bestuse of space and ensure efficient work flow, helpingwarehouses keep up with ever-changing customerdemands for new and better products.

Use a Warehouse Management SystemFor most warehousing operations, the rightwarehouse management system (WMS) softwareserves as the vital bridge linking production,scheduling, shipment planning and order fulfillmentsystems. Leading practices companies are careful towork only with WMS vendors who have expertise inthe best warehousing strategies for their types ofwarehouses, regardless of the vendors' knowledge ofthe company's vertical industry.

Reengineer Warehouse OperationsTo keep up with marketplace demands for efficientconsumer response and just-in-time (JIT) delivery,companies across the board are actively seekingopportunities to speed product flow along the supplychain. Recognizing the warehouse as a critical agentin supply chain efficiency, leading practicesbenchmark current warehouse operations andestablish targets for improvement.

Outsource Warehousing FunctionsTo reduce costs, as well as to better meet the growingcustomer demands for JIT service, companies aredivesting themselves of their private warehouses infavor of third-party options. While not a universalsolution, outsourcing is an attractive low-costalternative for many companies, based onbenchmarking costs of internal versus third-partyservice providers.

Unit- 3

Logistics Management and IT in Supply Chain Management

Inventory management refers to the process ofordering, storing, and using a company's inventory.These include the management of raw materials,components, and finished products, as well aswarehousing and processing such items.

The exponential growth of Information Technology (IT) withcommunication technology in Supply ChainManagement (SCM) is playing critical role in optimisingdecisions of the supply chain network flow for achievingorganisational competitiveness, improving higher servicelevel, lowering inventory, supply chain costs

BarcodesThe use of barcodes makes business integration processesin supply chain management simpler and moreefficient. Barcodes are an effective identification tool thathelps track products and greatly reduceerrors. Barcode technology has a range of advantagessuch as being affordable, easy to handle, and accurate.

A barcode or bar code is a method of representing data ina visual, machine-readable form. Initially, barcodesrepresented data by varying the widths and spacings ofparallel lines. These barcodes, now commonly referred to aslinear or one-dimensional (1D), can be scanned byspecial optical scanners, called barcode readers. Later, two-dimensional (2D) variants were developed, using rectangles,dots, hexagons and other geometric patterns, called matrixcodes or 2D barcodes, although they do not use bars as such.2D barcodes can be read or deconstructed using applicationsoftware on mobile devices with inbuilt cameras, suchas smartphones.

Unit 4Key Operation Aspects in Supply Chain

Understanding the Relationship between Human ResourceManagement (HRM) on Supply Chain Management (SCM)

While supply chains have been playing a crucial role in severalindustries for many years, it is only in the past few years thatsupply chain management (SCM) has been treated as a separatestrategic branch which can be improved to benefit businesses.As soon as SCM started receiving its due importance, there begana search for the factors that affect supply chain and itsfunctioning. While factors like inventory control, product design,industry standards, procedure costs, and distribution strategieswere some of the few that were initially discovered to abundantlyimpact SCM, human resource management (HRM) is the latest tojoin the list.

While there have been a few studies done in the past tounderstand the impact of HRM on SCM, the research bythe Department of Business Administration of Universityof Barcelona, Spain, clearly pointed out the relationshipbetween the two.The purpose of the study was to understand the impact ofHRM on SCM which in turn also impacts organizationalperformance (OP) and customer satisfaction (CS), factorswhich play an important role between SCM outcomes(SCMO) and HRM.

The study used the previously validated structural equationmodel (SEM) which is based on five attributes includingSCM implementation (SCMI), HRM, organizationalperformance, customer satisfaction, and SCMO. A surveywas conducted on the basis of this model and 231 responseswere recorded.The study confirmed the significant impact that HRM,directly and indirectly, has on the SCMI and SCMO.Overall, the study suggests that successful implementationof SCM can not only help improve SCMO directly but itindirectly also increases OP and CS.

These findings make a very strong case for organizations toapply proven HRM practices to their supply chains toimprove SCM to an extent where it starts functioning as acompetitive edge. While businesses never thought of SCM assomething that could be impacted by HRM, understandingthe relationship between the two is simpler than it looks.

Understanding the Relationship between Human Resource Management (HRM) on Supply Chain Management (SCM)Improving Customer Satisfaction with HRM

While the positive impact on SCM through successful HRM practices is clear now, how the same can also help in improving customer satisfaction as the University of Barcelona study suggests?This relationship too if pretty straightforward. Supply chains are only as strong as their weakest link. For instance, let us assume that you run a business in the USA and import products from China. You’ve selected an exporter and have successfully moved the products through customs and then to the distribution center sooner than expected.

But what if the distribution center delays the delivery to the customers? Your customers would surely be unhappy and this means that the supply chain of your company has failed. It is not difficult to understand that the retail industry relies mostly on customer satisfaction. In other words, the success of your supply chain has a deep relation with how happy your customers are.So, you see there is an indirect relationship between HRM and CS too. With the help of successful HRM practices, you can improve your supply chain which in turn will help you improve customer satisfaction. There are a few time-proven ways in which supply chain can be improved for better CS.

•Selecting the right transportation partners•Improving logistics planning•End-to-end supply chain analysis•Using technology for improving visibility and tracking inventory•Linking back-end and front-end deliveries•Measuring supply chain performance on a consistent basis•While all of these steps revolve around SCM, HRM is indirectly involved in implementing them and making sure that they deliver the expected results.

Understanding the Relationship between Human ResourceManagement (HRM) on Supply Chain Management (SCM)

While supply chains have been playing a crucial role in severalindustries for many years, it is only in the past few years thatsupply chain management (SCM) has been treated as a separatestrategic branch which can be improved to benefit businesses.As soon as SCM started receiving its due importance, there begana search for the factors that affect supply chain and itsfunctioning. While factors like inventory control, product design,industry standards, procedure costs, and distribution strategieswere some of the few that were initially discovered to abundantlyimpact SCM, human resource management (HRM) is the latest tojoin the list.

While there have been a few studies done in the past tounderstand the impact of HRM on SCM, the research bythe Department of Business Administration of Universityof Barcelona, Spain, clearly pointed out the relationshipbetween the two.The purpose of the study was to understand the impact ofHRM on SCM which in turn also impacts organizationalperformance (OP) and customer satisfaction (CS), factorswhich play an important role between SCM outcomes(SCMO) and HRM.

The study used the previously validated structural equationmodel (SEM) which is based on five attributes includingSCM implementation (SCMI), HRM, organizationalperformance, customer satisfaction, and SCMO. A surveywas conducted on the basis of this model and 231 responseswere recorded.The study confirmed the significant impact that HRM,directly and indirectly, has on the SCMI and SCMO.Overall, the study suggests that successful implementationof SCM can not only help improve SCMO directly but itindirectly also increases OP and CS.

These findings make a very strong case for organizations toapply proven HRM practices to their supply chains toimprove SCM to an extent where it starts functioning as acompetitive edge. While businesses never thought of SCM assomething that could be impacted by HRM, understandingthe relationship between the two is simpler than it looks.

Understanding the Relationship between Human Resource Management (HRM) on Supply Chain Management (SCM)Improving Customer Satisfaction with HRM

While the positive impact on SCM through successful HRM practices is clear now, how the same can also help in improving customer satisfaction as the University of Barcelona study suggests?This relationship too if pretty straightforward. Supply chains are only as strong as their weakest link. For instance, let us assume that you run a business in the USA and import products from China. You’ve selected an exporter and have successfully moved the products through customs and then to the distribution center sooner than expected.

But what if the distribution center delays the delivery to the customers? Your customers would surely be unhappy and this means that the supply chain of your company has failed. It is not difficult to understand that the retail industry relies mostly on customer satisfaction. In other words, the success of your supply chain has a deep relation with how happy your customers are.So, you see there is an indirect relationship between HRM and CS too. With the help of successful HRM practices, you can improve your supply chain which in turn will help you improve customer satisfaction. There are a few time-proven ways in which supply chain can be improved for better CS.

•Selecting the right transportation partners•Improving logistics planning•End-to-end supply chain analysis•Using technology for improving visibility and tracking inventory•Linking back-end and front-end deliveries•Measuring supply chain performance on a consistent basis•While all of these steps revolve around SCM, HRM is indirectly involved in implementing them and making sure that they deliver the expected results.