Supply Chain and Supply Chain Management

A supply chain is a network between a company and its suppliers to produce and distribute a specific product to the final buyer. This network includes different activities, people, entities, information, and resources. The chain also represents a series of steps involved to get a product or service to the customer. The steps include moving and transforming raw materials into finished products, transporting those products, and distributing them to the end-user. The entities involved include producers, vendors, warehouses, transportation companies, distribution centers, and retailers. Supply chain management (SCM) is a very important part of the business process because an optimized supply chain results in lower costs and a faster production cycle. There are many different links in this chain that require skill and expertise. When SCM is effective, it can lower a company’s overall costs and boost profitability. If one link breaks down, it can affect the rest of the chain and can be costly.

Supply chain management (SCM), the management of the flow of goods and services, involves the movement and storage of raw materials, of work-in-process inventory, and of finished goods as well as end to end order fulfilment from point of origin to point of consumption. Interconnected, interrelated or interlinked networks, channels and node businesses combine in the provision of products and services required by end customers in a supply chain. Supply chain management has been defined as the “design, planning, execution, control, and monitoring of supply-chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand and measuring performance globally”. SCM practice draws heavily from the areas of industrial engineering, systems engineering, operations management, logistics, procurement, information technology, and marketing and strives for an integrated approach. Marketing channels play an important role in supply-chain management. Current research in supply-chain management is concerned with topics related to sustainability and risk management, among others. Some suggest that the “people dimension” of SCM, ethical issues, internal integration, transparency/visibility, and human capital/talent management are topics that have, so far, been underrepresented on the research agenda. Supply chain management (SCM) is the broad range of activities required to plan, control and execute a product’s flow from materials to production to distribution in the most economical way possible. SCM encompasses the integrated planning and execution of processes required to optimize the flow of materials, information and capital in functions that broadly include demand planning, sourcing, production, inventory management and logistics — or storage and transportation.


  • A SC is a network between a company and its suppliers to produce and distribute a specific product or service.
  • The entities include producers, vendors, warehouses, transportation companies, distribution centers, and retailers.
  • The functions in a SC include product development, marketing, operations, distribution, finance, and customer service.
  • Successful SCM results in lower costs and a faster production cycle; and ensures that there is no delay in delivery at any point in the chain and that products and services are delivered in good condition.

5 thoughts on “Supply Chain and Supply Chain Management

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