Supply Chain Management (SCM)
The ultimate goal of supply chain management (SCM) is to effectively and efficiently manage the movement of material or products through the supply chain cycle (Mateen & More, 2013; Park & Min, 2013). Such a lofty goal is accomplished only through the creation of strong partnerships with suppliers and customers, reduction of waste, and maintenance of product visibility to insure both quantity and quality meet predetermined requirements (Boerner, 2010a, 2010b). As SCM has matured as a discipline, so has the implementation of some tools to assist in achieving these goals, while still maintaining a green or sustainable presence (Berthon, Critenden, Desautels, & Pitt, 2010; Beamon, 1999). One such tool is the application of a lean production mode, which can assist in the achievement of waste reduction goals throughout the supply chain, especially when strategic partners apply the same principles. Another valuable tool is the utilization of large corporate IT-infrastructures and analytical data warehouses (Ha, Park, Lee, & Park, 2013; Mehrjerdi, 2009; Smith, 2015). As an added enhancement to a lean supply chain, the use of real time data from these IT-infrastructures gives firms better details of current information and product movement. The use of real-time data sharing from both intra-firm and external partners is ideal for more accurate forecasting and reliable model development.
A supply chain is the sequence of activities to get materials or products to end-users. A firm’s supply chain includes all steps from raw material to final product, as well as assurance of customer satisfaction (Smith, 2010, 2015; Smith & Minutolo, 2014). In the past, most firms have been concerned only with the work completed within their shop. Unfortunately, this has led to a rather disjointed supply chain characterized by higher inventory levels, poor forecasting ability, and limited visibility or products as a whole. The use of supply chain management as a means to remain competitive in a global economy is an essential component for financial success. In today’s global business environment, effective SCM is crucial to enhancing business performance. It is a collaborative effort on the part of management to position and run the supply chain in the most efficient and effective ways possible. This effort covers activities from product development, sourcing, production, and logistics, as well as the information systems needed to coordinate these activities.
Creating strong partnership with a select supplier base can allow for better communication and product knowledge (Browning & Heath, 2009; Cavaleri, 2008). Aligning firms with likeminded suppliers is a key activity of SCM. With the use of a select supply base, firms are better able to share pertinent data across supply chain members. Above all, this leads to better quality and reduced waste.