Understanding the Concept of Supply Chain - Literature review Example

Supply Chain [By] of] Supply Chain Perez d that supply chain is a system of people, organisations, sources, and resources involved in the movement of goods from one place to another mainly from supplier to customer. Oliver (2002) stated that supply chain is involved with transformation of raw materials into finished goods that is further delivered to end customer in a systematic manner. Supply chain also involves planning and management of all activities involved in sourcing, procurement, logistics, and management of activities. Supply chain can be considered as an important and integral part of the business organisations as it is concerned with managing of sources and resources. Blanchard (2010) added that supply chain is also concerned with managing supply and demand that plays an important role in the sourcing and manufacturing of products. Wieland (2013) further added that supply chain begins with biological, ecological, and political regulation followed by extraction of raw materials by human beings and also including production links. After production links, storage facilities need to be checked as products tend to be stored and transported through logistics in order to reach to the final customers. In this regard, it can be said that the success of any organisation or industry is solely dependent on the effective and efficient supply chain. Supply chain needs to be strengthened in order to add value to the operational and functional framework. Blanchard (2010) further added that supply chain is a value chain process through which value and benefits are shared with customers. Supply chain helps in competing within the industry along with making the entire operational framework robust in the long run. Overall, it can be said that supply chain is the most important part of any industry or organisations and success of it can decide the success parameters of the organisations in a significant manner. Components of Supply Chain Perez (2013) stated that there are five major components of supply chain playing an important role in the success of organisations. These five components are in the form of supplier, manufacturer, distributor, retailers, and consumers. Suppliers provide raw materials or unfinished goods that come early in the supply chain. Manufacturers are also involved in the production of goods while suppliers are concerned with the procurement of raw materials, manufacturers are concerned with the final assemble of goods in an integrated manner. Distributors are concerned with the storage and handling of materials in the warehouse along with distributing them at the retail outlets. The major work of retailers is to act as an intermediary between the supplier and customers. They are concerned with buying of goods and reselling them to end consumers. Finally, consumers are the one buying products and can be considered as an important part of the supply chain. Wieland (2013) stated that all the components of supply chain are important in making it robust and useful. There is no denying that high level of integration is required between all the components in order to make it successful. Perez (2013) stated that supply chain components need to be aligned well in order to create value. Additionally, there should be high level of transparency between all the components in order to enhance the usefulness of the supply chain. Overall, it can be said that each component of the supply chain is crucial for customer satisfaction and should be planned and managed in an efficient manner. Reference: Blanchard, D (2010) Supply Chain Management Best Practices (2nd ed.). John Wiley & Sons. Differences between Forward and Reverse Logistics within a Supply Chain Oliver (2002) stated that forward logistic is based on getting products in the market and using automated information to track products in a systematic manner. Forward logistic is also concerned with product development, manufacturing process, and distribution. Additionally, it is also concerned with testing, localization, customization, packaging, and distribution of products in a planned manner. Forward logistics also helps in reducing the lead time, increasing service level by responding to customer queries, and optimizing products as per the customers’ demands. On the other hand, reverse logistics is concerned with the reuse and recycling of products and services. It also includes managing and sale of surplus goods in an effective and planned manner. As stated before, reverse logistics is concerned with the reuse and resale of products, it also involves great deal of planning and management. It is also a process of moving goods from their final destination for the purpose of proper disposal and recapturing value. Both forward and reverse logistics have been quite useful and important to the supply chain. As supply chain is concerned with the management and planning of sources and resources, forward and reverse logistics help in dealing with the movement of goods and services along with making sure that genuine value is generated in a planned manner. Forward logistics is often considered as a planned way of dealing with the movement of goods while reverse logistics is mainly unclear in many regards. Processes are more visible and transparent in the forward logistics while the same is not clear and transparent in the case of reverse logistics. Overall, it can be said that both forward and reverse logistics are an important part of the supply chain and help in facilitating the movement and transfer of products in a systematic manner. Concept of Supply Chain Evolving Over the Time Oliver (2002) stated that supply chain has evolved a lot in the 20th century mainly in the form of emergence of lean and agile paradigms. Wieland (2013) stated that in the 21st century, the competitive benefits and development in supply chain are still elusive in nature making it all the more complex and important at the same time. Blanchard (2010) stated that managing the complexities of supply chain has been the biggest challenge in the modern real world supply chains. Additionally, there have been fundamental gaps in academic and practitioners’ understanding requiring great deal of understanding. Over the years, supply chain has evolved a lot and the dual concept of integration and collaboration needs to be analysed and assessed well for understanding the evolution of the traditional supply chain into the modern supply chain in a significant manner. Perez (2013) stated that flexibility in supply chain, inventory replishment, and buyer-seller power have further made it evident that organisations need to overcome inter-organisational barriers for the making supply chains successful and beneficial in the long run. Wieland (2013) stated that a number of mechanisms do not allow effective integration and collaboration that has been affecting the supply chain framework in different industries. Overall, it can be said that for better evolution of supply chain, it is important to focus more on the integration and collaboration that will help in strengthening the supply chain along with enhancing its value in a great way. This will make the supply chain more impactful and beneficial for everyone associated with it. References Blanchard, D (2010) Supply Chain Management Best Practices (2nd Ed.). John Wiley & Sons. Oliver, R (2002) Supply-chain management: logistics catches up with strategy. In Christopher, M. Logistics: The Strategic Issues. London: Chapman Hall. pp. 63–75 Perez, H (2013) Supply Chain Roadmap: aligning supply chain with business strategy. Oxford Publishers Wieland, A (2013) The influence of relational competencies on supply chain resilience: a relational view. International Journal of Physical Distribution & Logistics Management. Vol. 43, No. 4, pp. 300-320. Read More