Understanding the difference between the two ensures youll use the. Vertical integration is a strategy where a company expands its business operations into different steps on the same production path, such as when a manufacturer owns its supplier andor. One that has full responsibility across the corporation including different divisions, business units, and geographies for the planning and management of all activities involved in endtoend supply chain processes, including direct sourcing and procurement, conversionmanufacturing, and all logistics management activities. Vv 31 english vocabulary for supply chain management 2. The use of a 24hour clock instead of am and pm when reporting actual labour or machine time or specifying. A listing and description of activities that provides a. Supply chain coordination aims at improving supply chain performance by aligning the plans and the objectives of individual enterprises. Demand the need for a specific item in a specific quantity. Practitioners and educators have variously addressed the concept of supply chain management scm as an extension of logistics, the same as logistics, or as an allencompassing approach to.
Definition of sustainable supply chain management sscm. An electronic supply chain has a new set of pros and cons, different from those in traditional scm. Supply chain management definition and importance of its. Stay current and improve productivity, consistency and knowledge across the supply chain with the 16th edition of the apics dictionary. According to the apics dictionary, supply chain management scm is 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. Supply chain and logistics terms and glossary iwla. Supply chain management is a vital component of minimizing a companys risk of fraud, bribery, and corruption, and new tools can help organizations looking to limit their exposure to these risks as modern technology worms its way into even the oldest of businesses. A more detailed definition of esupply chain management can be found in the description of norris et al. Entire network of entities, directly or indirectly interlinked and interdependent in serving the same consumer or customer.
Jun 26, 2019 operations management refers to the administration of business practices to create the highest level of efficiency possible within an organization. Supply chain and logistics terms and glossary updated february, 2010. You may also be looking for an mba dictionary or mba glossary. Management of material and information flow in a supply chain to provide the highest degree of customer satisfaction at the lowest possible cost. The driving force behind supply chain management scm is to reduce inventory.
Supply chain management requires the commitment of supply chain partners to work closely to coordinate order generation, order taking, and order fulfillment. Supply chain activities involve the transformation of natural resources, raw materials, and components into a finished product that is delivered to the customer. Demand chain management the same as supply chain management, but with an emphasis on consumer pull versus supplier push. This management dictionary contains a description and explanation of terms and methods. Collaboration of singlemanufacturer multibuyer inventory status with credit option. Effective scm ensures that items go where they need to go, when they need to go there. Value chain management vcm is a strategic business analysis tool used for the seamless integration and collaboration of value chain components and resources. Supply chain management is the management of the flow of goods and services and includes all processes that transform raw materials into final products. Definition of supply chain management in the dictionary. This paper seeks to introduce supply chain and supply chain management. A more detailed definition of e supply chain management can be found in the description of norris et al.
Supply chain management was then further defined as the integration of supply chain activities through improved supply chain relationships to achieve a competitive advantage. Its overall goal is to balance supply and demand so sales revenue opportunities are fully exploited in a timely manner and at the lowest possible cost. Get your kindle here, or download a free kindle reading app. Organisation of the overall business processes to enable the profitable transformation of raw materials or products into finished goods and their timely distribution to meet customer demand. In reality, though the terms are related, they shouldnt be used interchangeably because they dont mean the same thing. Its a kind of vendor managed inventory vmi system where the decision of quantity and time to replenish lies with supplier and not the retailer. Vv 30 business english vocabulary for supply chain management 1. Scm encompasses the processes of creating and fulfilling the markets demand for goods and services. Often times scm can be confused with the term logistics management. A supply chain and supply chain management definition, theoretical, practical and measurement analysis are proposed.
Managing the movement of goods from raw materials to the finished product delivered to customers. Green supply chain management integrates ecofriendly aspects into conventional supply chain management practices, in order to make the every activity of the value chain. Supply chain management is the management of the flow of goods and services in order to deliver value to the end customer effectively along with optimising the process of delivering it. Released 50 years after the first edition, the 16th edition adds more than 200 terms over the previous release, adding to the dynamic apics body of knowledge. Supply chain management scm is the process of shepherding materials through the many phases of a companys operations, from procurement and warehousing to shipping.
The systematic and coordinated set of activities required to. With the supply chain covering a broad range of disciplines, the definition of what is a supply chain can be unclear. The supply chain management scm profession has continued to change and evolve to fit the needs of the growing global supply chain. Cooper 2000 issues in supply chain management, industrial marketing. Scor is the worlds leading supply chain framework, linking business processes, performance metrics, practices and people skills into a unified structure. The apics dictionary, 15th edition, contains more than 4800 terms and definitions relevant to supply chain management professionals working in todays global environment. Supply chain management reduces costs by increasing inventory turnover on the. Jun 18, 2012 in this video vocab english lesson, well look at the basic steps in the supply chain, beginning with suppliers, who sell materials or parts to the manufacturers that assemble products. This includes product design, planning, execution, monitoring and control.
Cscmp supply chain management definitions and glossary. What is supply chain management scm and why is it important. In commerce, supply chain management scm, the management of the flow of goods and. The supply chain is the most obvious face of the business for customers and consumers. Scm involves the flow of materials, finances and information. Supply chain management scm definition, importance. Supply chain management scm is the active streamlining of a business supplyside activities to maximize customer value and gain a competitive advantage in the. Supply chain definition and meaning collins english.
Supply chain definition and meaning collins english dictionary. Supply chain management scm is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer. The identification, acquisition, access, positioning, management of resources and related capabilities the organization needs or potentially needs in the attainment of its strategic objectives. Management of material and information flow in a supply chain to provide the highest degree of customer satisfaction at.
Supply chain management scm is the management and oversight of a product from its origin until it is consumed. Managers, academics, students, professionals and practitioners of supply chain management require ready access to a definitive source of current terminology and practice. In the late 1990s, supplychain management scm rose to prominence, and operations managers began to use it in their titles with increasing regularity. Ism leadership carefully crafted and periodically updates the futureoriented definition of supply management. Supply chain management involves coordinating and integrating these flows both within and among companies. Supply chain management scm is the broad range of activities required to plan, control and execute a products flow from materials to production to distribution in the most economical way possible. The objective of supply chain sustainability is to create, protect and grow longterm environmental, social and economic value for all stakeholders. Scm supply chain management a business strategy to improve shareholder and customer value by optimizing the flow of products, services and related information from source to customer. The set of skills, technologies, applications and practices used to help a business acquire abetter understanding of its commercial context to make better business decisions. Demand override any adjustment that is used to supersede your demand history usually for the purposes of forecasting or calculating safety stock.
The definitions of procurement and supply chain management. Supply chain management scm definition investopedia. Access your free download copy or purchase a printed copy. Understand how your supply chain organization, distribution center or manufacturing site measure against competitors to close performance gaps. Supply chain management definition in the cambridge. Supply chain management may be said to be broadly about the efficient and effective management of all activities. Supply chain and logistics terms and glossary updated february, 2010 please note. A crossfunctional approach to procuring, producing and delivering products and services. Supply definition and meaning collins english dictionary. The a3 system is a means of describing a business process in a compact form. Vv 30 business english vocabulary for supply chain. Management meaning in the cambridge english dictionary. Over the years i have gathered the most uptodate glossary of supply chain management terms, concepts and definitions relevant to the subject, which i hope you will find it.
In the purchasing world, its easy to use terms like supply chain management and procurement interchangeably. In the late 1990s, supply chain management scm rose to prominence, and operations managers began to use it in their titles with increasing regularity. Oct 17, 2015 supply chain sustainability, is the management of environmental, social and economic impacts and the encouragement of good governance practices, throughout the lifecycles of goods and services. Supply chain management article about supply chain. Third party logistics providers typically specialize in integrated operation, warehousing and transportation services that can be scaled and customized to customers. Supply chain business solutions apics for business. Part two the definition of supply chain management executive summary supply chain management is still evolving and developing and there are, therefore, numerous definitions of it, some of which are presented in this paper. Supply chain management aims to reduce operating costs, lead times, and inventory and increase the speed of delivery, product availability, and customer satisfaction. The fixed costs are usually allocated to units of output on the basis of direct labor hours, machine hours, or material costs. Glossary, dictionary, terminology, supply chains, operations management entries tend to be arranged according to their abbreviation. Supply chain planning scp is the process of anticipating the demand for products and planning their materials and components, production, marketing, distribution and sale.
The broad management scope includes subsuppliers, suppliers, internal information and funds flow. Jun, 2019 electronic supply chain management is the method of managing a supply chain online. The process of obtaining and managing of products or services needed to operate a business or other type of organization. Its a supply chain strategy in which frequent replenishment takes place from the supplier to the retailer or distributor in order to maintain better flow in supply chain and minimize bullwhip effect. A supply chain, as opposed to supply chain management, is a set of organizations directly linked by one or more of the upstream and downstream flows of products, services, finances, and information from a source to a customer. It takes the concept of electronic business e business and marries that with supply chain management scm. Supplychain management was then further defined as the integration of supply chain activities through improved supply chain relationships to achieve a competitive advantage. The better and more effective a companys supply chain management is, the better it protects its business reputation and longterm sustainability. In cost management, an approach to inventory valuation in which variable costs and a portion of fixed costs are assigned to or absorbed into each unit of production. Download our english dictionary apps available for both ios and android. If you supply someone with something that they want or need, you give them a quantity of. Erp plm business process management ehs management supply chain management ecommerce quality management cmms manufacturing. A listing and description of activities that provides a commonstandard definition of activities across the organization.
The apics dictionary, 16th edition, contains more than 4,900 terms and definitions relevant to supply chain and operations management professionals working in todays global environment. It usually focuses on inventory management and ordering decisions in distributed intercompany settings. Elements of supply management include the actual products, information, budgets, and employees. It comprises of vendors that supply raw material, producers who convert the material into products, warehouses that store, distribution centers that deliver to the retailers, and retailers who bring the. It is said that the ultimate goal of any effective. Definition of supply chain various definitions of a supply chain have been offered in the past several years as the concept has gained popularity. Business conducted between companies, rather than between a company and individual consumers. Other commonly accepted definitions of supplychain management include. In simple language, managing all of the above activities in tandem to manage demand and supply on a global scale is supply chain management. When you are able to be good at supply chain management your business will flourish thanks to your low cost and happy customers. Several randomly selected refereed academic articles were methodically analyzed. In this video vocab english lesson, well look at the basic steps in the supply chain, beginning with suppliers, who sell materials or parts to the manufacturers that assemble products. Supply chain management definition of supply chain. Sscm may be perceived as the proper management of related environmental, social, and economic impacts in constructing and maintaining effective and efficient global supply chains.
In business and finance, supply chain is a system of organizations, people, activities, information, and resources involved in supplying a product or service to a consumer. Supply chain management terms and glossary updated. Chain definition and meaning collins english dictionary. When you are able to be good at supply chain management your. What is sustainable supply chain management sscm igi. As per definition scm is the management of a network of all business processes and activities involving procurement of raw materials, manufacturing and distribution management of finished goods. The purpose of supply management procedures is to keep costs stable and use resources effectively to. A thirdparty logistics provider abbreviated 3pl, or sometimes tpl is a firm that provides service to its customers of outsourced or third party logistics services for part, or all of their supply chain management functions. A chain consists of metal rings connected together in a line. Supply chain management software includes tools or modules used to execute supply chain transactions, manage supplier relationships and control associated business processes. The international warehouse logistics association iwla does not take responsibilityfor the content of these definitions and doesnot endorse theseas official. In cost management, a system that maintains financial and operating. Sscm encourages governance practices at all levels of lifecycles of goods and services that. Compiled and edited by members of the society from a number of sources, the aim of this dictionary is to.
Supply chain management is an integrating function with primary responsibility for linking major business functions and business processes within and across. Jun 25, 2012 in this video vocab lesson, well look at business english vocabulary for describing some of the processes involved in managing the supply chain, such as warehousing, purchasing, and materials. Entire network of entities, directly or indirectly. Vcm focuses on minimizing resources and accessing value at each chain level, resulting in optimal process integration, decreased inventories, better products and enhanced customer.
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