Thursday 18 September 2008

IRELAND - NATIONAL INSTITUTE FOR TRANSPORT AND LOGISTICS - SUPPLY CHAIN MANAGEMENT

National Institute for Transport & Logistics
Dublin Institute of Technology,
17 Herbert Street,
Dublin. 2.

Tel: +353-1-6690806
Fax: +353-1-6611943
E-mail: nitl@dit.ie
Web-site: www.nitl.ie

What is Supply Chain Management?
A product or service is delivered to the ultimate customer through a complex interaction of several companies on the way, i.e. through a supply chain. The manufacturer's ability to give customers what they want, when they want it, at the price and quality that they want, is not just determined by the manufacturer's skill or expertise in running his/her own operation. No degree of improvement in the company itself can make up for suppliers not delivering, delivering wrongly or late. High inventory levels are often the result of an effort to buffer against such uncertainties. Inefficient production methods add additional uncertainties and unnecessary costs. The distribution of goods into foreign markets adds significantly to the cost of most consumer goods or components. Inefficiencies anywhere in the chain will reduce the chances of the manufacturer successfully competing against other suppliers. It is now recognised, therefore, that supply chains compete
with other supply chains.

Supply chain management is concerned with the total management of the supply chain. As such, it is an essential activity in any company's everyday life. Very often the company is let down not by their own actions, but by the actions of other parties involved. Many companies do not even realise the importance of supply chain management to their future survival. It applies to small or large companies, whether they are in manufacturing, process or service industries. Improving ones own business is no guarantee of success in today's competitive markets. The individual success of a company depends not alone on their in-house skills and expertise. Without the right companies up and down the supply chain to work with a company will never achieve true competitive advantage.

At the end of the day supply chain management is the management of all the activities in any of the companies involved in a supply chain to achieve two things: to provide the highest possible level of customer service at minimum cost.