Supply Chain Management: Maintain a Smooth Flow of Goods to Customer

Imagine a product you want, available on time, with the best quality, and a competitive price. Behind this smoothness, there is a complex and vital system: Supply Chain Management (SCM). SCM is like a lifeline for a company. It orchestrates the flow of goods and information, from raw materials, manufacturing, storage, to distribution, so that products can reach the hands of customers smoothly.

Supply Chain Management is The active management of supply chain activities and relationships in order to maximize customer value and achieve a sustainable competitive advantage. Supply chain management (SCM) is the science that studies the management of these networks.

In other words, SCM is a strategy for managing and monitoring the flow of goods, services and information in a supply chain. Supply Chain itself is A network of manufacturers and service providers that work together to create products or services needed by end users.  These manufacturers and service providers are linked together through physical flows, information flows, and monetary flows.

The main goal of SCM is to ensure that products reach customers smoothly and efficiently. This includes planning activities, inventory management, production, delivery, and after-sales service. Good SCM can reduce costs, increase customer satisfaction, and make a company more competitive.

Why is SCM Important?

Supply Chain Management or SCM is an important strategy that helps companies manage goods and information flows efficiently and effectively. It is done by connecting all parties in the supply chain, from suppliers to customers, to ensure that products are available on time, in the right place, and at competitive prices.

The importance of SCM for companies in the modern era is undeniable. With good SCM implementation, companies can increase efficiency, increase customer satisfaction, increase competitiveness, and minimize risk. In addition, SCM can also help companies sustainability by reducing their carbon footprint and using environmentally friendly raw materials.

In an era of globalization and digitalization, SCM is becoming increasingly important. Factors such as globalization and technological developments require companies to have more complex and adaptive supply chains. By implementing the right SCM, companies can seize new opportunities, increase profitability, and build a sustainable future.

Supply Chain Management (SCM) is a complex system involving many parties and processes.

1. Planning: The process begins with determining the estimated demand for products and raw materials. Then, the company formulates a strategy to meet the demand, including choosing the right suppliers and logistics partners.

2. Acquisition: At this stage, the company purchases the raw materials and components from the selected supplier. The quality of the raw material and the components is assured, and price negotiations and delivery times are carried out.

3. Production: Raw materials are converted into finished products through manufacturing processes. Production efficiency and quality areined, and control over the supply of raw materials and finished products is kept under control.

4. Distribution: The finished product is delivered to the customer through the chosen method, such as land, sea, or air transport. Delivery is tracked to ensure the product arrives on time.

5. Sales: The product is promoted and sold to the customer. Good customer service is provided, and the relationship with the customer is continuously managed.

6. Returns: Product returns from customers are received and processed. A refund or product exchange is done, and the reason for the return is analyzed to improve product quality.

7. Information: Data about supply chains are collected and analyzed to help companies make better decisions. This information is also shared with other parties in the supply chain to improve efficiency and collaboration.

These processes are interrelated and interdependent. The smoothness and efficiency of one process will affect the other. Therefore, it is important to have an integrated and well-coordinated SCM system.

Some factors that can affect the SCM process include:

• Demand: Fluctuating demand can cause problems in planning and production.
• Supply: Disruptions in the supply of raw materials can cause production delays.
• Technology: The use of new technologies can improve efficiency and visibility in the supply chain.
• Regulations: Government regulations can affect SCM processes, such as environmental and trade regulations.

To an effective SCM, companies need to:

• Have a clear and measurable SCM strategy.
• Build strong relationships with suppliers and logistics partners.
• Applying the right technology to improve efficiency and visibility.
• Having a competent and experienced team in SCM. By implementing effective SCM, companies can increase efficiency, increase customer satisfaction, increase competitiveness, and minimize risk.