A supply chain defines the events associated with the movement of a product right from the manufacturer to the final consumer. On the other hand, supply chain management is the control and regulation of the movement of goods and services. Activities that occur in a supply chain include the movement and storage of raw materials used in production and the movement of the finished products from the production plant to the final consumer. Supply chains are very important in business as they determine the success of business in globalized markets and networked economies. Supply chain design refers to establishing the desired vital strategic results for the firm and creating, executing, and overseeing the assets, procedures, and connections that can make such results achievable (Melnyka, Ram & Hugo 1887). This paper describes the importance of the supply chains, the process of supply chain design, and how supply chains influence the success of a business.
In the last two decades, the supply chain has evolved into a powerful competitive tool in the modern and turbulent marketplace. Today, firms can leverage the abilities offered by the supply chain to create favorable business ratio with other stakeholders such as the clients and suppliers. The advantages that a properly-defined supply chain can offer to a firm include low operational costs, improved business responsiveness, fewer inventories, and increased focus on design, capital ventures, and execution. The term “supply chain management” was conjured in 1982 by Keith Oliver during an interview with the Financial Times (Melnyka, Ram & Hugo 1888). After that, the term evolved as a discipline and widely applied in the industrial sector. The principles of supply chain management were born by the need for efficient business practices that could counter the dangers of doing business and capitalize on the available opportunities.
Research in the design of efficient supply chains has concentrated mainly on the available avenues that enhance capacity while simultaneously reducing costs. Apart from these two applications, supply chain management can be used to realize other advantages such as driving development, increasing business responsiveness, and ensuring sustainability in business practices.
As the desired results change, the attributes of the ideal supply chain also changes. While a lot of production network research is centered on the importance of configuration choices, there is a shortage of powerful empirical and logical analysis. Such analysis can outline the importance of influencers in the supply chain design process. The Fisher model advocates for an effective supply chain for useful items and a responsive inventory supply chain for innovative items. Melnyka, Narasimhana and DeCamposb outline an experiment to test this system (1889). The three authors experimentally test the system with regard to the catering industry with reference to 170 food organizations in Malaysia and the United Kingdom. The respondents were picked from different levels of the supply chain the food industry. These included manufacturers, wholesalers, and retailers. It was discovered that an effective supply chain can be adjusted to accommodate food products over all levels of the supply chain.
Just like consumer products, supply chains are characterized by life cycles and phases of development. Researchers working in the field of supply chain management have established the existence of life cycles and phases. Such researchers include Kovács and Spens, who identified three life cycles and Pettit and Beresford who identified four-stage cycles (Melnyka, Ram & Hugo 1889). The researcher also established that inventory network has a life cycle. As such, there is need to explore the basic prerequisites at each stage and to establish a method for ensuring smooth transition from one life cycle to the next.
Supply chain management is an important practice in business as without it, it would be impossible to identify areas of weaknesses in a supply model. Also, the practice enables a business to establish strong attributes of their supply chains so that they can capitalize on them. Without proper supply chain management, businesses lose their competitive edge in the market. Supply chains are dynamic and are have life cycles and phases. Therefore, frequent assessment of a supply chain is essential to ensure its in line with the requirements of a business.
Work Cited
Melnyka, Steven, Ram Narasimhana, & Hugo DeCamposb. “Supply chain design: issues, challenges, frameworks and solutions.” International Journal of Production Research 52 (2014): 1887-1894. Web. 15 April. 2016.
