Understanding the Supply Chain Management in This Corporate World

Profitable business is every entrepreneur’s ticket to real success. The entrepreneur’s career ladder always begins with an idea and then followed by selling that idea to the market. There is no shortcut to entrepreneurship. It is a continuous process. Every aspiring entrepreneur must learn, execute and study more the market that he wants to deal with. Selling products and services is business yet an entrepreneur has to exert more efforts in order to win and achieve the stability, profitability and dominance among competitors. The world of business is very challenging much more when business these days are beginning to welcome the modern marketing methods and systems of improving sales. Almost every company has its corporate office other than their main factory. Usually located on high rise buildings in major cities of every country, these offices aim to observe best practices on the Supply Chain Management (SCM) and as well as establish excellent Customer Relationship Management (CRM).

What’s Happening Inside the Corporate World?

We all know the rules of business. From the Chief Executive Officer (CEO) going down to the lowest rank employee in terms of job role, the primary goal of every company or corporation is to deliver products and services that will give satisfaction to the customers to the highest level. Work, jobs, projects, issues, problems, delays and brain storming sessions are in between these two business operation end points. Oftentimes, we observe from the top news on TV, the internet, the newspapers and the media press conferences that business critics, economists and market analysts are discussing the latest moves of the company CEO and top executives. One company acquires this company. Two companies merge together. Sometimes, it’s the bad news; a company files for bankruptcy. This is becoming a routine in the world of business or technically, the corporate world. Not all companies succeed. The competition is always there and it is always a challenge for every company to deliver their best moves in order to win the customers.

The Truth About Supply Chain Management

When it comes to the supply chain in business, there are three key performance indicators that dictate the game of winning and losing. They are the cost of products and services, the cycle time in delivering these products and services to the customers, and the quality that if delivered with excellence will make every customer happy. Supply Chain Management (SCM) is defined by Wikipedia as “the management of a network of interconnected businesses involved in the provision of product and service packages required by the end customer in a supply chain”. The meaning is clear; it has something to do with managing the customer’s needs. That is actually the purpose of entrepreneurship. The entire corporate world is battling for clients. And if we establish that link of one business operation to the other inside a company, there is no reason to say that they are not interconnected. Therefore, the failure of one process could mean the breakage of the chain and absolutely the failure to supply to the customers what they need at the right cost, at the fastest lead time and the highest quality.

SCM is About Winning the Market

We can relate SCM to the Law of Supply and Demand. The price of any commodity is dependent on the quantity produced and the quantity demanded. When a certain price becomes fixed on a given time, the competition among suppliers becomes stiffer because customers have the option to choose on where to buy the products or services that they want. The SCM is very much dependent on this law; reason why corporate executives always want their SCM team to be more sensitive to the movement in the market. Whenever there is a need for adjustment, it will be dealt with accordingly and timely until a final winning decision is made. This is why many companies and corporations invest a lot on acquiring best talents on SCM. Business analyst, financial consultant, and SCM specialist; their role is to help the company survive the competition and in whatever business way, win the market.

Excellent Supplier Relationship will Improve Profitability

One effective way of winning the market is to strengthen the company’s supplier relationship. In fact, this is always the starting point of every company’s SCM operation. From acquisition of raw materials, consumable items, new machines, or even services that will help deliver products and services to the customers, supplier will do it all for the company being their customer. If your suppliers are showing poor scores on these three key performance indicators, then it will surely affect your entire operation. Therefore, it should be your SCM’s goal of ensuring that suppliers are in line with your main business objective – profitability for success.