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Business-Process Integration: Supply-Chain Management 2.0 (SCM 2.0)

The document discusses supply chain management 2.0 (SCM 2.0) and how it has evolved with globalization and specialization. SCM 2.0 involves collaborative platforms and processes to manage increasingly complex supply chains. Key aspects of SCM discussed include business process integration, customer relationship management, procurement, product development, manufacturing, distribution, outsourcing, performance measurement, warehousing and inventory management.

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0% found this document useful (0 votes)
232 views8 pages

Business-Process Integration: Supply-Chain Management 2.0 (SCM 2.0)

The document discusses supply chain management 2.0 (SCM 2.0) and how it has evolved with globalization and specialization. SCM 2.0 involves collaborative platforms and processes to manage increasingly complex supply chains. Key aspects of SCM discussed include business process integration, customer relationship management, procurement, product development, manufacturing, distribution, outsourcing, performance measurement, warehousing and inventory management.

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nidayousafzai
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© © All Rights Reserved
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Supply-chain management 2.0 (SCM 2.

0)[edit]
Building on globalization and specialization, the term "SCM 2.0" has been coined to describe both changes within supply chains
themselves as well as the evolution of processes, methods, and tools to manage them in this new "era". The growing popularity of
collaborative platforms is highlighted by the rise of TradeCard's supply-chain-collaboration platform, which connects multiple buyers
and suppliers with financial institutions, enabling them to conduct automated supply-chain finance transactions. [47]
Web 2.0 is a trend in the use of the World Wide Web that is meant to increase creativity, information sharing, and collaboration
among users. At its core, the common attribute of Web 2.0 is to help navigate the vast information available on the Web in order to
find what is being bought. It is the notion of a usable pathway. SCM 2.0 replicates this notion in supply chain operations. It is the
pathway to SCM results, a combination of processes, methodologies, tools, and delivery options to guide companies to their results
quickly as the complexity and speed of the supply-chain increase due to global competition; rapid price fluctuations; changing oil
prices; short product life cycles; expanded specialization; near-, far-, and off-shoring; and talent scarcity.

Business-process integration[edit]
Successful SCM requires a change from managing individual functions to integrating activities into key supply-chain processes. In
an example scenario, a purchasing department places orders as its requirements become known. The marketing department,
responding to customer demand, communicates with several distributors and retailers as it attempts to determine ways to satisfy
this demand. Information shared between supply-chain partners can only be fully leveraged through process integration.
Supply-chain business-process integration involves collaborative work between buyers and suppliers, joint product development,
common systems, and shared information. According to Lambert and Cooper (2000), operating an integrated supply chain requires
a continuous information flow. However, in many companies, management has concluded that optimizing product flows cannot be
accomplished without implementing a process approach. The key supply-chain processes stated by Lambert (2004) [48] are:

 Customer-relationship management
 Customer-service management
 Demand-management style
 Order fulfillment
 Manufacturing-flow management
 Supplier-relationship management
 Product development and commercialization
 Returns management
Much has been written about demand management.[49] Best-in-class companies have similar characteristics, which include the
following:

 Internal and external collaboration


 Initiatives to reduce lead time
 Tighter feedback from customer and market demand
 Customer-level forecasting
One could suggest other critical supply business processes that combine these processes stated by Lambert, such as:
Customer service management process
Customer relationship management concerns the relationship between an organization and its customers. Customer
service is the source of customer information. It also provides the customer with real-time information on scheduling and
product availability through interfaces with the company's production and distribution operations. Successful organizations
use the following steps to build customer relationships:

 determine mutually satisfying goals for organization and customers


 establish and maintain customer rapport
 induce positive feelings in the organization and the customers
Procurement process
Strategic plans are drawn up with suppliers to support the manufacturing flow management process and the development
of new products.[50] In firms whose operations extend globally, sourcing may be managed on a global basis. The desired
outcome is a relationship where both parties benefit and a reduction in the time required for the product's design and
development. The purchasing function may also develop rapid communication systems, such as electronic data
interchange (EDI) and Internet linkage, to convey possible requirements more rapidly. Activities related to obtaining
products and materials from outside suppliers involve resource planning, supply sourcing, negotiation, order placement,
inbound transportation, storage, handling, and quality assurance, many of which include the responsibility to coordinate
with suppliers on matters of scheduling, supply continuity (inventory), hedging, and research into new sources or
programs. Procurement has recently been recognized as a core source of value, driven largely by the increasing trends to
outsource products and services, and the changes in the global ecosystem requiring stronger relationships between
buyers and sellers.[51]
Product development and commercialization
Here, customers and suppliers must be integrated into the product development process in order to reduce the time to
market. As product life cycles shorten, the appropriate products must be developed and successfully launched with ever-
shorter time schedules in order for firms to remain competitive. According to Lambert and Cooper (2000), managers of the
product development and commercialization process must:

1. coordinate with customer relationship management to identify customer-articulated needs;


2. select materials and suppliers in conjunction with procurement; and
3. develop production technology in manufacturing flow to manufacture and integrate into the best supply chain
flow for the given combination of product and markets.
Integration of suppliers into the new product development process was shown to have a major impact on product
target cost, quality, delivery, and market share. Tapping into suppliers as a source of innovation requires an
extensive process characterized by development of technology sharing, but also involves managing
intellectual[52] property issues.
Manufacturing flow management process
The manufacturing process produces and supplies products to the distribution channels based on past forecasts.
Manufacturing processes must be flexible in order to respond to market changes and must accommodate mass
customization. Orders are processes operating on a just-in-time (JIT) basis in minimum lot sizes. Changes in the
manufacturing flow process lead to shorter cycle times, meaning improved responsiveness and efficiency in meeting
customer demand. This process manages activities related to planning, scheduling, and supporting manufacturing
operations, such as work-in-process storage, handling, transportation, and time phasing of components, inventory at
manufacturing sites, and maximum flexibility in the coordination of geographical and final assemblies postponement of
physical distribution operations.
Physical distribution
This concerns the movement of a finished product or service to customers. In physical distribution, the customer is the
final destination of a marketing channel, and the availability of the product or service is a vital part of each channel
participant's marketing effort. It is also through the physical distribution process that the time and space of customer
service become an integral part of marketing. Thus it links a marketing channel with its customers (i.e., it links
manufacturers, wholesalers, and retailers).
Outsourcing/partnerships
This includes not just the outsourcing of the procurement of materials and components, but also the outsourcing of
services that traditionally have been provided in-house. The logic of this trend is that the company will increasingly focus
on those activities in the value chain in which it has a distinctive advantage and outsource everything else. This
movement has been particularly evident in logistics, where the provision of transport, storage, and inventory control is
increasingly subcontracted to specialists or logistics partners. Also, managing and controlling this network of partners and
suppliers requires a blend of central and local involvement: strategic decisions are taken centrally, while the monitoring
and control of supplier performance and day-to-day liaison with logistics partners are best managed locally.
Performance measurement
Experts found a strong relationship from the largest arcs of supplier and customer integration to market share and
profitability. Taking advantage of supplier capabilities and emphasizing a long-term supply-chain perspective in customer
relationships can both be correlated with a firm's performance. As logistics competency becomes a critical factor in
creating and maintaining competitive advantage, measuring logistics performance becomes increasingly important,
because the difference between profitable and unprofitable operations becomes narrower. A.T. Kearney Consultants
(1985) noted that firms engaging in comprehensive performance measurement realized improvements in overall
productivity. According to experts [according to whom?], internal measures are generally collected and analyzed by the firm, including
cost, customer service, productivity, asset measurement, and quality. External performance is measured through
customer perception measures and "best practice" benchmarking.
Warehousing management
To reduce a company's cost and expenses, warehousing management is concerned with storage, reducing manpower
cost, dispatching authority with on time delivery, loading & unloading facilities with proper area, inventory management
system etc.
Inventory management
Inventory management entails inventory planning and forecasting. Inventory
management is about ensuring the right stock at the right levels, in the right place,
at the right time and the right cost. Forecasting helps planning inventory.
Workflow management
Integrating suppliers and customers tightly into a workflow (or business process) and thereby achieving an efficient and
effective supply chain is a key goal of workflow management.

Theories[edit]
There are gaps in the literature on supply-chain management studies at present (2015) [citation needed]: there is no theoretical
support for explaining the existence or the boundaries of supply-chain management. A few authors, such as Halldorsson
et al.,[53] Ketchen and Hult (2006),[54] and Lavassani et al. (2009), have tried to provide theoretical foundations for different
areas related to supply chain by employing organizational theories, which may include the following:

 Resource-based view (RBV)[55]
 Transaction cost analysis (TCA)
 Knowledge-based view (KBV)
 Strategic choice theory (SCT)
 Agency theory (AT)
 Channel coordination
 Institutional theory (InT)
 Systems theory (ST)
 Network perspective (NP)
 Materials logistics management (MLM)
 Just-in-time (JIT)
 Material requirements planning (MRP)
 Theory of constraints (TOC)
 Total quality management (TQM)
 Agile manufacturing
 Time-based competition (TBC)
 Quick response manufacturing (QRM)
 Customer relationship management  (CRM)
 Requirements chain management (RCM)
 Dynamic Capabilities Theory
 Dynamic Management Theory
 Available-to-promise (ATP)
 Supply Chain Roadmap®[56]
However, the unit of analysis of most of these theories is not the supply chain but rather another system, such as the firm
or the supplier-buyer relationship. Among the few exceptions is the relational view, which outlines a theory for considering
dyads and networks of firms as a key unit of analysis for explaining superior individual firm performance (Dyer and Singh,
1998).[57]

Organization and governance[edit]


The management of supply chains involve a number of specific challenges regarding the organization of relationships
among the different partners along the value chain. Formal and informal governance mechanisms are central elements in
the management of supply chain.[58] Research in supply chain management has noted the importance of using the
appropriate combination of contracts and relational norms to mitigate the risks and prevent conflicts between supply chain
partners.[59] In turn, particular combinations of governance mechanisms may impact the relational dynamics within the
supply chain.

Supply chain[edit]
In the study of supply-chain management, the concept of centroids has become an important economic consideration. A
centroid is a location that has a high proportion of a country's population and a high proportion of its manufacturing,
generally within 500 mi (805 km). In the US, two major supply chain centroids have been defined, one near Dayton, Ohio,
and a second near Riverside, California.
The centroid near Dayton is particularly important because it is closest to the population center of the US and Canada.
Dayton is within 500 miles of 60% of the US population and manufacturing capacity, as well as 60% of Canada's
population.[60] The region includes the interchange between I-70 and I-75, one of the busiest in the nation, with 154,000
vehicles passing through per day, of which 30–35% are trucks hauling goods. In addition, the I-75 corridor is home to the
busiest north-south rail route east of the Mississippi River.[60]

Wal-Mart strategic sourcing approaches[edit]


In 2010, Wal-Mart announced a big change in its sourcing strategy. Initially, Wal-Mart relied on intermediaries in the
sourcing process. It bought only 20% of its stock directly, but the rest were bought through the intermediaries.
[61]
 Therefore, the company came to realize that the presence of many intermediaries in the product sourcing was actually
increasing the costs in the supply chain. To cut these costs, Wal-Mart decided to do away with intermediaries in the
supply chain and started direct sourcing of its goods from the suppliers. Eduardo Castro-Wright, the then Vice President
of Wal-Mart, set an ambitious goal of buying 80% of all Wal-Mart goods directly from the suppliers. [62] Walmart started
purchasing fruits and vegetables on a global scale, where it interacted directly with the suppliers of these goods. The
company later engaged the suppliers of other goods, such as cloth and home electronics appliances, directly and
eliminated the importing agents. The purchaser, in this case Wal-Mart, can easily direct the suppliers on how to
manufacture certain products so that they can be acceptable to the consumers. [63] Thus, Wal-Mart, through direct sourcing,
manages to get the exact product quality as it expects, since it engages the suppliers in the producing of these products,
hence quality consistency.[62] Using agents in the sourcing process in most cases lead to inconsistency in the quality of the
products, since the agent's source the products from different manufacturers that have varying qualities.
Wal-Mart managed to source directly 80% profit its stock; this has greatly eliminated the intermediaries and cut down the
costs between 5-15%, as markups that are introduced by these middlemen in the supply chain are cut. This saves
approximately $4–15 billion.[61] This strategy of direct sourcing not only helped Wal-Mart in reducing the costs in the supply
chain but also helped in the improvement of supply chain activities through boosting efficiency throughout the entire
process. In other words, direct sourcing reduced the time that takes the company to source and stocks the products in its
stock.[62] The presence of the intermediaries elongated the time in the process of procurement, which sometimes led to
delays in the supply of the commodities in the stores, thus, customers finding empty shelves. Wal-Mart adopted this
strategy of sourcing through centralizing the entire process of procurement and sourcing by setting up four global
merchandising points for general goods and clothing. The company instructed all the suppliers to bring their products to
these central points that are located in different markets.[63] The procurement team assesses the quality brought by the
suppliers, buys the goods, and distributes them to various regional markets. The procurement and sourcing at centralized
places helped the company to consolidate the suppliers.
The company has established four centralized points, including an office in Mexico City and Canada. Just a mere piloting
test on combining the purchase of fresh apples across the United States, Mexico, and Canada led to the savings of about
10%. As a result, the company intended to increase centralization of its procurement in North America for all its fresh fruits
and vegetables.[61] Thus, centralization of the procurement process to various points where the suppliers would be meeting
with the procurement team is the latest strategy which the company is implementing, and signs show that this strategy is
going to cut costs and also improve the efficiency of the procumbent process.
Strategic vendor partnerships is another strategy the company is using in the sourcing process. Wal-Mart realized that in
order for it to ensure consistency in the quality of the products it offers to the consumers and also maintain a steady
supply of goods in its stores at a lower cost, it had to create strategic vendor partnerships with the suppliers. [61] Wal-Mart
identified and selected the suppliers who met its demand and at the same time offered it the best prices for the goods. It
then made a strategic relationship with these vendors by offering and assuring the long-term and high volume of
purchases in exchange for the lowest possible prices.[62] Thus, the company has managed to source its products from
same suppliers as bulks, but at lower prices. This enables the company to offer competitive prices for its products in its
stores, hence, maintaining a competitive advantage over its competitors whose goods are a more expensive in
comparison.
Another sourcing strategy Wal-Mart uses is implementing efficient communication relationships with the vendor networks;
this is necessary to improve the material flow. The company has all the contacts with the suppliers whom they
communicate regularly and make dates on when the goods would be needed, so that the suppliers get ready to deliver
the goods in time.[64] The efficient communication between the company's procurement team and the inventory
management team enables the company to source goods and fill its shelves on time, without causing delays and empty
shelves.[65] In other words, the company realized that in ensuring a steady flow of the goods into the store, the suppliers
have to be informed early enough, so that they can act accordingly to avoid delays in the delivery of goods. [62] Thus,
efficient communication is another tool which Wal-Mart is using to make the supply chain be more efficient and to cut
costs.
Cross-docking is another strategy that Wal-Mart is using to cut costs in its supply chain. Cross-docking is the process of
transferring goods directly from inbound trucks to outbound trucks.[61] When the trucks from the suppliers arrive at the
distribution centers, most of the trucks are not offloaded to keep the goods in the distribution centers or warehouses; they
are transferred directly to another truck designated to deliver goods to specific retail stores for sale. Cross-docking helps
in saving the storage costs.[66] Initially, the company was incurring considerable costs of storing the suppliers from the
suppliers in its warehouses and the distributions centers to await the distribution trucks to the retail stores in various
regions.

Tax-efficient supply-chain management[edit]


Tax-efficient supply-chain management is a business model that considers the effect of tax in the design and
implementation of supply-chain management. As the consequence of globalization, cross-national businesses pay
different tax rates in different countries. Due to these differences, they may legally optimize their supply chain and
increase profits based on tax efficiency.[67][failed verification]

Sustainability and social responsibility in supply


chains[edit]
Supply-chain sustainability is a business issue affecting an organization's supply chain or logistics network, and is
frequently quantified by comparison with SECH ratings, which uses a triple bottom line incorporating economic, social,
and environmental aspects.[68] SECH ratings are defined as social, ethical, cultural, and health' footprints. Consumers have
become more aware of the environmental impact of their purchases and companies' SECH ratings and, along with non-
governmental organizations (NGOs), are setting the agenda for transitions to organically grown foods, anti-
sweatshop labor codes, and locally produced goods that support independent and small businesses. Because supply
chains may account for over 75% of a company's carbon footprint, many organizations are exploring ways to reduce this
and thus improve their SECH rating.
For example, in July 2009, Wal-Mart announced its intentions to create a global sustainability index that would rate
products according to the environmental and social impacts of their manufacturing and distribution. The index is intended
to create environmental accountability in Wal-Mart's supply chain and to provide motivation and infrastructure for other
retail companies to do the same.[69]
It has been reported that companies are increasingly taking environmental performance into account when selecting
suppliers. A 2011 survey by the Carbon Trust found that 50% of multinationals expect to select their suppliers based upon
carbon performance in the future and 29% of suppliers could lose their places on 'green supply chains' if they do not have
adequate performance records on carbon.[70]
The US Dodd–Frank Wall Street Reform and Consumer Protection Act, signed into law by President Obama in July 2010,
contained a supply chain sustainability provision in the form of the Conflict Minerals law. This law requires SEC-regulated
companies to conduct third party audits of their supply chains in order to determine whether any tin, tantalum, tungsten, or
gold (together referred to as conflict minerals) is mined or sourced from the Democratic Republic of the Congo, and create
a report (available to the general public and SEC) detailing the due diligence efforts taken and the results of the audit. The
chain of suppliers and vendors to these reporting companies will be expected to provide appropriate supporting
information.
Incidents like the 2013 Savar building collapse with more than 1,100 victims have led to widespread discussions
about corporate social responsibility across global supply chains. Wieland and Handfield (2013) suggest that companies
need to audit products and suppliers and that supplier auditing needs to go beyond direct relationships with first-tier
suppliers. They also demonstrate that visibility needs to be improved if supply cannot be directly controlled and that smart
and electronic technologies play a key role to improve visibility. Finally, they highlight that collaboration with local partners,
across the industry and with universities is crucial to successfully managing social responsibility in supply chains. [71]

Circular supply-chain management[edit]


Circular Supply-Chain Management (CSCM) is "the configuration and coordination of the organisational functions
marketing, sales, R&D, production, logistics, IT, finance, and customer service within and across business units and
organizations to close, slow, intensify, narrow, and dematerialise material and energy loops to minimise resource input
into and waste and emission leakage out of the system, improve its operative effectiveness and efficiency and generate
competitive advantages". By reducing resource input and waste leakage along the supply chain and configure it to enable
the recirculation of resources at different stages of the product or service lifecycle, potential economic and environmental
benefits can be achieved. These comprise e.g. a decrease in material and waste management cost and reduced
emissions and resource consumption.[72]

Components[edit]
Management components[edit]
SCM components are the third element of the four-square circulation framework. The level of integration and
management of a business process link is a function of the number and level of components added to the link. [73]
[74]
 Consequently, adding more management components or increasing the level of each component can increase the level
of integration of the business process link.
Literature on business process reengineering[75][76][77] buyer-supplier relationships, [78][79][80][81] and SCM[20][82][83] suggests various
possible components that should receive managerial attention when managing supply relationships. Lambert and Cooper
(2000) identified the following components:

 Planning and control


 Work structure
 Organization structure
 Product flow facility structure
 Information flow facility structure
 Management methods
 Power and leadership structure
 Risk and reward structure
 Culture and attitude
However, a more careful examination of the existing literature[26][84][85][86][87][88][89][90][91] leads to a more comprehensive
understanding of what should be the key critical supply chain components, or "branches" of the previously identified
supply chain business processes—that is, what kind of relationship the components may have that are related to suppliers
and customers. Bowersox and Closs (1996) state that the emphasis on cooperation represents the synergism leading to
the highest level of joint achievement. A primary-level channel participant is a business that is willing to participate in
responsibility for inventory ownership or assume other financial risks, thus including primary level components. [92] A
secondary-level participant (specialized) is a business that participates in channel relationships by performing essential
services for primary participants, including secondary level components, which support primary participants. Third-level
channel participants and components that support primary-level channel participants and are the fundamental branches of
secondary-level components may also be included.
Consequently, Lambert and Cooper's framework of supply chain components does not lead to any conclusion about what
are the primary- or secondary-level (specialized) supply chain components [93] —that is, which supply chain components
should be viewed as primary or secondary, how these components should be structured in order to achieve a more
comprehensive supply chain structure, and how to examine the supply chain as an integrative one.

Reverse supply chain[edit]


Reverse logistics is the process of managing the return of goods. It is also referred to as "aftermarket customer services".
Any time money is taken from a company's warranty reserve or service logistics budget, one can speak of a reverse
logistics operation. Reverse logistics is also the process of managing the return of goods from store, which the returned
goods are sent back to warehouse and after that either warehouse scrap the goods or send them back to supplier for
replacement depending on the warranty of the merchandise. 3

Digitalisation in Supply Chains[edit]


Consultancies and media expect the performance efficacy of digitalisation in supply chains to be very high. [94] Renowned
journals such as the Journal of Business Logistics, the Journal of Operations Management and the International Journal
of Physical Distribution & Logistics Management have already published several special issues for various aspects of
digitalisation in supply chain management. Additive manufacturing and blockchain technology have emerged as the two
technologies with some of the highest economic relevance. The potential of additive manufacturing is particularly high in
the production of spare parts, since its introduction can reduce warehousing costs of slowly rotating spare parts. [95] Yet, the
technology bears the potential to completely disrupt and restructure supply chains and hitherto existing production routes.
[96]

In comparison, research on the influence of blockchain technology on the supply chain is still in its early stages.
The conceptual literature has argued for a considerably long time that the highest performance efficacy is expected in the
technology’s potential for automatic contract creation. [97] However, latest empirical findings contradict this hypothesis. The
highest potential is currently expected in the arenas of verified customer reviews and certifications of product quality and
standards.[98] Companies like DNVG-L have already developed blockchain products such as MY STORY that can be used
to create more secure supply chains. Further empirical results are expected soon.
In addition, the technological features of blockchains support transparency and traceability of information as well as high
levels of reliability and immutability of records.[99] Blockchains thus offer opportunities to foster collaboration in the supply
chain.[100]

Systems and value[edit]


Supply chain systems configure value for those that organize the networks. Value is the additional revenue over and
above the costs of building the network. Co-creating value and sharing the benefits appropriately to encourage effective
participation is a key challenge for any supply system. Tony Hines defines value as follows: "Ultimately it is the customer
who pays the price for service delivered that confirms value and not the producer who simply adds cost until that point". [18]

Global applications[edit]
Global supply chains pose challenges regarding both quantity and value. Supply and value chain trends include:

 Globalization
 Increased cross-border sourcing
 Collaboration for parts of value chain with low-cost providers
 Shared service centers for logistical and administrative functions
 Increasingly global operations, which require increasingly global coordination and planning to achieve global optimums
 Complex problems involve also midsized companies to an increasing degree
These trends have many benefits for manufacturers because they make possible larger lot sizes, lower taxes, and better
environments (e.g., culture, infrastructure, special tax zones, or sophisticated OEM) for their products. There are many
additional challenges when the scope of supply chains is global. This is because with a supply chain of a larger scope, the
lead time is much longer, and because there are more issues involved, such as multiple currencies, policies, and laws.
The consequent problems include different currencies and valuations in different countries, different tax laws, different
trading protocols, vulnerability to natural disasters and cyber threats, [101] and lack of transparency of cost and profit.

Supply chain consulting[edit]


Supply-chain consulting is the providing of expert knowledge in order to assess the productivity of a supply-chain and,
ideally, to enhance the productivity.
Supply chain Consulting is a service involved in transfer of knowledge on how to exploit existing assets through improved
coordination and can hence be a source of competitive advantage; Hereby the role of the consultant is to help
management by adding value to the whole process through the various sectors from the ordering of the raw materials to
the final product.[102]
On this regard, firms either build internal teams of consultants to tackle the issue or use external ones, (companies
choose between these two approaches taking into consideration various factors).[103]
The use of external consultants is a common practice among companies. [104] The whole consulting process generally
involves the analysis of the entire supply-chain process, including the countermeasures or correctives to take to achieve a
better overall performance.[105]

Certification[edit]
Skills and competencies[edit]
Supply chain professionals need to have knowledge of managing supply chain functions such as
transportation, warehousing, inventory management, and production planning. In the past, supply chain professionals
emphasized logistics skills, such as knowledge of shipping routes, familiarity with warehousing equipment and distribution
center locations and footprints, and a solid grasp of freight rates and fuel costs. More recently, supply-chain management
extends to logistical support across firms and management of global supply chains.[106] Supply chain professionals need to
have an understanding of business continuity basics and strategies.[107]

Roles and responsibilities[edit]


Supply chain professionals play major roles in the design and management of supply chains. In the design of supply
chains, they help determine whether a product or service is provided by the firm itself (insourcing) or by another firm
elsewhere (outsourcing). In the management of supply chains, supply chain professionals coordinate production among
multiple providers, ensuring that production and transport of goods happen with minimal quality control or inventory
problems. One goal of a well-designed and maintained supply chain for a product is to successfully build the product at
minimal cost. Such a supply chain could be considered a competitive advantage for a firm.[108][109]
Beyond design and maintenance of a supply chain itself, supply chain professionals participate in aspects of business that
have a bearing on supply chains, such as sales forecasting, quality management, strategy development, customer
service, and systems analysis. Production of a good may evolve over time, rendering an existing supply chain design
obsolete. Supply chain professionals need to be aware of changes in production and business climate that affect supply
chains and create alternative supply chains as the need arises.[108] Individuals working in supply-chain management can
attain a professional certification by passing an exam developed by a third party certification organizations. The purpose
of certification is to guarantee a certain level of expertise in the field.

Education[edit]
The knowledge needed to pass a certification exam may be gained from several sources. Some knowledge may come
from college courses, but most of it is acquired from a mix of on-the-job learning experiences, attending industry events,
learning best practices with their peers, and reading books and articles in the field. [110] Certification organizations may
provide certification workshops tailored to their exams.[111] There are also free websites that provide a significant amount of
educational articles, as well as blogs that are internationally recognized which provide good sources of news and updates.

University rankings[edit]
The following North American universities rank high in their master's education in the SCM World University 100 ranking,
which was published in 2017 and which is based on the opinions of supply chain managers: Michigan State
University, Penn State University, University of Tennessee, Massachusetts Institute of Technology, Arizona State
University, University of Texas at Austin and Western Michigan University. In the same ranking, the following European
universities rank high: Cranfield School of Management, Vlerick Business School, INSEAD, Cambridge
University, Eindhoven University of Technology, London Business School and Copenhagen Business School.[112] In the
2016 Eduniversal Best Masters Ranking Supply Chain and Logistics the following universities rank high: Massachusetts
Institute of Technology, KEDGE Business School, Purdue University, Rotterdam School of Management, Pontificia
Universidad Catolica del Peru, Universidade Nova de Lisboa, Vienna University of Economics and
Business and Copenhagen Business School.[113]
Organizations[edit]
There are a number of organizations that provide certification exams, such as CSCMP (Council of Supply Chain
Management Professionals), IIPMR (International Institute for Procurement and Market Research), APICS (the
Association for Operations Management), ISCEA (International Supply Chain Education Alliance) and IoSCM (Institute of
Supply Chain Management). APICS' certification is called Certified Supply Chain Professional, or CSCP, and ISCEA's
certification is called the Certified Supply Chain Manager (CSCM), CISCM (Chartered Institute of Supply Chain
Management) awards certificate as Chartered Supply Chain Management Professional (CSCMP). Another, the Institute
for Supply Management, is developing one called the Certified Professional in Supply Management (CPSM)[114] focused on
the procurement and sourcing areas of supply-chain management. The Supply Chain Management Association (SCMA)
is the main certifying body for Canada with the designations having global reciprocity. The designation Supply Chain
Management Professional (SCMP) is the title of the supply chain leadership designation.

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