Supply Chain Management

For years, researchers and practitioners have primarily investigated the various processes within manufacturing supply chains individually. Recently, however, there has been increasing attention placed on the performance, design, and analysis of the supply chain as a whole.

Thisattention is largely a result of the rising costs of manufacturing, the shrinking resources of manufacturing bases, shortened product life cycles, the leveling of the playing field within manufacturing, and the globalization of market economies.

What’s the future holds for supply chain management? The future of supply chain management is the future of the business management when there will be no business that is not part of a supply chain. The paradigm of business management will soon be converged to the paradigm of supply chain management. To precisely fortune-tell the future of supply chains is meaningless.

But what’s useful is to identify and explore some challenges that we better prepare ourselves for. Three key challenges have been identified and discussed here.

Supply Relationship Defined

Supply relationship can be defined as the cross organisational interaction and exchange between the participating members of the supply chain. This means that the relationship is between organisations not individual people within the same supply chain where the material flows defines the boundary. However for the inter-organisational interaction that falls outside of the main streams of the material flows, then it may not be called collaborative relationship or partnership relation, but may not be the supply relationship.

Supply relationship can be either on the upstream side with the suppliers or on the downstream side with the buyers. If the relationship is solely observed between one supply and one buyer, it is also called dyadic relationship.

Strategic Role of Purchasing

Purchasing function has a strategically indispensible role to play in supply chain management. It covers the sourcing end of supply chain management interfacing with the delivery end of the suppliers.

The classical definition of purchasing is : to obtain materials and/or services of the right quality in the right quantity from the right source, deliver them to the right place at the right price.

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