Supply Chain Management

By Author: Henry Ford
Total Articles: 189
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Question 1
There is a major difference between logistics and supply chain management. Logistics in its function include physical distribution, warehousing, freight transportation including inbound and outbound, and in some of the industries, logistics also include the function of the customer service including processing of orders, planning inventory, and production planning. On the other hand, supply chain management includes different functions of logistics mentioned above and other functions including purchasing, procurement, manufacturing operations, scheduling of production, and control of inventory. Supply chain management also include other functions like material management, planning of location facilities, coordination of information technology between suppliers, the company , and customers. This means that supply chain management runs from the producers of the raw materials to end users.

Therefore, the major distinction between the two is that while logistics deals with inbound and outbound for a company, supply chain management deals with inbound or instream. Supply chain includes the network ...
... facilities including warehousing, factories, terminals, ports, and others; vehicles like trains, trucks, planes, vessels; and the information system that connects suppliers and customers. Logistics on the other hand include what happens in the supply chain and it involves flow of materials, information, and money.
From the above discussions, it is evident that supply chain management starts from the nature and the ends at the nature. This means that it starts from the people are the production level and ends with at same level but in the function of consumption. This means that process involves extraction of raw material, transportation, production, and ends up with the consumption of the produced goods. ON the other hand, logistics is just time scheduling of a give process in the supply chain. This implies that logistics is one of the processes that make up the supply chain. The two terms are therefore likely to overlap the other in definition unless a clear distinction is made between the two.

Question 2
Over the years, the function of a warehouse has been changing as far as supply chain management is concerned. There has been a great change in the way warehousing is incorporated in the supply chain considering the changing approach to production and warehousing management functions. It is important to realize that warehousing plays an important role in the supply chain process. However, additional costs in the production and warehousing may be incurred and this may have an impact on the final profitability of the organization.

Over the years, the emergence of production techniques like on-time production has been initiated by the increased cost of warehousing that lead to holding of capital for the business. As a result, most companies are today taking different strategies to ensure that the supply chain is improved and the overall cost of on warehousing is greatly reduced. In today changing environment, there are major changes that are taking place to improve warehousing in the supply chain process. One of the ways in which a current efficient supply chain management might utilize warehousing is adopting a demand-driven planning that is based on planned production process. This will ensure that materials delivered for production are only those that are required for the production process while the goods produced are only those that are required by the customers. As a function of supply chain management, the aim of a modern improved supply chain should be to minimize the overall cost of supply chain. Although large supply chain may serve to improve the supply chain function, it has an effect on holding up the capital. Therefore, the aim should be to efficiently manage warehousing such that it does not tie up the capital and at the same time, it does not increase the cost of supply chain. The best way to improve warehousing would be to adopt lean strategies in the supply chain.

Question 3
A balanced scorecard is a strategy planning and management tolls that is currently used in business, organizations, and in governments. It is used to align business activities to the vision and the strategy that has been adopted by the organization. A balance scorecard is perhaps the most important management tool that is used to assess the extent to which the business is in a position to achieve its strategies. Developed by Drs. Robert Kaplan and David Norton, it is an important performance management framework that has added non-financial performance measures to the traditional financial metrics that were used to give a balanced view of the organizational performance. As a performance management tool, a balanced scorecard measures communication functions in the organization including internal and external communication and it also monitors the performance in other metrics against the strategic goals and objectives. It is prudent for a firm to include financial and non -financial metrics in evaluating its performance given the fact that both help to give the position of the firm in the market. Evaluation of a firm is performed against the set strategy. This means that the performance of a firm should be benchmarked against the set strategy because the aim of a balanced scorecard is to show the extent to which financial and non financial goals and objectives have been achieved. The modern balanced score helps to transform the organization strategic plan from a passive document existing on papers to a matching orders for the organization whose content are put to use on daily bases.

Link Related Questions
From my participation in LINKS supply chain management simulation, I have learned a lot. I have learnt the importance of aligning the supply chain management to the existing market conditions. For example, the decision by LINK to have DC in region 3 was mainly motivated by the existing market conditions. From the simulation, I have learnt the importance of considering all the market conditions including cost of doing business, price wars and others in choosing the appropriate components of the supply chain. I have learnt that it in choice of supply chain, it is important to keep away from price wars. In addition I have learnt that there are number of trade-offs between a decision to increase or decrease n activity and they have to be well evaluated and considered for each decision based on their possible short-term and long-term consequences. I have also learnt the importance of RFID and Crossdocking and their effects on the choice o f supply chain. In the above to aspects, LINKS supply simulation shows the importance of considering the insource and outsource functions. From the simulation, I have also learnt that it is important to choose a DC in a location that will give positive return on investment in the long term. This means that in choosing a distribution center, the focus should not be on the short term but rather on the long term.

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