Supply Chain Management System: Role of Operation Essay Example
Operation management involves a series of actions where producers employ a workforce to obtain materials. These materials are then processed to create the required product which is taken to the market for consumption by customers. According to Khosrow (2001), supply chain management is involved in the analysis and management of logistics networks. In any type of firm that produces goods or services for customers, both operation and supply chain management are crucial for ensuring high-quality goods are delivered on time.
Smith (1999) asserts that the above measure aims to enhance producers' competitive capability in the market and enable them to remain among the best even with changes in consumer preferences. Logistics chain philosophy encompasses supply, transportation, and distribution modes, facilitating strategic measures to achieve goals such as shorter production cycles, reduced production costs, lower inventories, and improved customer service. According to Norio (2001), sup
...ply chain management ensures efficiency and adherence to the company's production standards, with minimal managerial control of logistic operations.
The purpose of implementing supply chain management is to reduce loss control problems while also accommodating an increasing number of partners. The collaborative efforts of various companies and their operation's trustworthiness are ensured through supply chain management, improving inventory visibility. There have been multiple models throughout different scholarly discussions for the movement of materials within organizations. The SCOR council on supply chain management suggests the one supply chain model as the best model, while the forum for global chain of supply advocates for the SCM model. The supply chain process has tactical, strategic, and operational stages across multiple levels.
The strategic level involves optimizing networks by identifying centers of distribution, facility availability, and manufacturing locations.
Partnership issues between distributors, suppliers, and customers are addressed for effective communication and logistics coordination. Product design is also considered to ensure seamless flow in the supply chain with existing products. Information technology infrastructure is overseen for efficiency. The tactical stage deals with contract sourcing and purchase decision-making approved by the organization.
At the tactical level of supply chain management, various production decisions are made, such as planning, contracting, and inventory-related decisions. Additionally, decisions are made regarding inventory quantity, quality, transportation mode and frequency, as well as pavement milestones and other requirements that will ensure successful implementation of company strategies. According to Donna (2002), operational duties of supply chain management include devising efficient distribution routes and monitoring daily production schedules. It is also the responsibility of operational management to ensure that the goods produced reach the intended customers at the right time and in the correct quantities.
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