Supply Chain Concept
The Internet has had an immense impact on the supply chain within companies since its inception. It has changed the way business is conducted and viewed. Companies are increasingly utilizing the Internet to streamline processes and service customers. It has increased competition and increased the rate at which business is conducted and streamlined. If anything, The Internet has made it crucial for businesses to plan and execute their company’s mission and goals more efficiently and effectively.
Companies along with their management teams must understand how to work along the value chain and their technical systems. “An effective IS strategy must be driven by organizational goals that can sustain the change of technologies over time” (Chan, 2005). It is imperative that the management teams understand all processes within their companies in order to obtain customer satisfaction which is the end result within any business transaction. Vendor relationships are paramount in order to produce quality for end users or customers.
These relationships along with solid streamlined value chain processes are necessary for growth and survival. They also contribute to a company’s customer satisfaction, maintained market share, and increased market share. These relationships along with the supply chain concept can be applied to almost every type of business currently known. The Internet in tandem with expertise knowledge of a company’s processes is crucial for a company’s survival. There are myriad factors that contribute to successful value chain planning, strategies, and executions.
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In this piece, I will discuss and expound on the purpose of value supply chains from an e-business point of view, share the four roles of the Internet service value chain, and the difference between a B2C site and a B2B site. “Supply chain management (SCM) is the integration of key business processes from end-user through original suppliers, that provides products, services, and information that add value for customers and other stakeholders”(Supply Chain: Managing Logistics for the 21st Century, para. 5).
Supply chain management’s goal is to manage the process from raw materials to the actual end products or services in the most efficient manner available. “The supply chain is made up of a network of companies each with common goals, working together as a team to develop, communicate, sell, supply and service the customer” (Understanding the Supply Chain Concept, para. 1). “The supply chain covers a spectrum of business functions and process steps, encompassing all the activities associated with moving goods from the raw materials stage to the final customer”(Cross, para.4).
Today, this equates to meshing a company’s technology with all the company’s business facets including purchasing, manufacturing, accounting and finance, marketing, as well as logistics(Supply Chain: Managing Logistics for the 21st Century, para. 11). A company’s information systems are pinnacle in streamlining all business processes. Upper management must understand how their business operates.
In addition, it is imperative to comprehend how to integrate smart purchasing from vendors into the mix. When vendors and the business processes are integrated effectively, there are myriad benefits and advantages. “The advantages include: 10 to 30 percent higher on-time delivery performance, a 40 to 65 percent (or one-to-one month) advantage in cash-to-cash cycle time, 50-80 percent less standing inventory” (Supply Chain: Managing Logistics for the 21st Century, para. 11).
In order for supply chains to be successful, every link within the supply chain must be cohesive and “work together effectively as a strong and dynamic supply chain partner” (Understanding the Supply Chain Concept, para. 3). The supply chain’s goal is to leverage off of every process and vendor within the chain in order to gain customer satisfaction. In addition, it is to provide every step of the process with automation.