THE USE OF SUPPLY CHAIN MANAGEMENT IN MANUFACTURING ORGANISATION TO CONTROL INVENTORY LEVELS WHILE PROVIDING ADEQUATE SERVICE TO CUSTOMERS;
A CASE STUDY OF EASTWIND FOODS
INTRODUCTION
Supply-chain management and it encompasses all of those integrated activities that bring product to market and
create satisfied customers. The Supply Chain Management Program integrates topics from manufacturing
operations, purchasing, transportation, and physical distribution into a unified program. Successful supply chain
management, then, coordinates and integrates all of these activities into a seamless process. It embraces and
links all of the partners in the chain. In addition to the departments within the organization, these partners
include vendors, carriers, third party companies, and information systems providers Within the organization, the
supply chain refers to a wide range of functional areas. These include Supply Chain Management-related
activities such as inbound and out bound transportation, warehousing, and inventory control. Sourcing,
procurement, and supply management fall under the supply-chain umbrella, too. Forecasting, production
planning and scheduling, order processing, and customer service all are part of the process as well. Importantly,
it also embodies the information systems so necessary to monitor all of these activities. Simply stated, the supply
chain encompasses all of those activities associated with moving goods from the raw-materials stage through to
the end user.”
Advocates for this business process realized that significant productivity increases could only come from
managing relationships, information, and material flow across enterprise borders. One of the best definitions of
supply-chain management offered to date comes from Bernard J. (Bud) La Londe, professor emeritus of Supply
Chain Management at Ohio State University. La Londe defines supply-chain management as follows: “The
delivery of enhanced customer and economic value through synchronized management of the flow of physical
goods and associated information from sourcing to consumption. “As the “from sourcing to consumption” part
of our last definition suggests, though, achieving the real potential of supply-chain management requires
integration not only of these entities within the organization, but also of the external partners. The latter include
the suppliers, distributors, carriers, customers, and even the ultimate consumers. All are central players in what
James E. Morehouse of A.T. Kearney calls the extended supply chain. “The goal of the extended enterprise is to
do a better job of serving the ultimate consumer,”. Superior service, he continues, leads to increased market
share. Increased share, in turn, brings with it competitive advantages such as lower warehousing and
transportation costs, reduced inventory levels, less waste, and lower transaction costs.
The customer is the key to both quantifying and communicating the supply chain’s value, confirms Shrawan
Singh, vice president of integrated supply-chain management at Xerox.
“If you can start measuring customer satisfaction associated with what a supply chain can do for a customer and
also link customer satisfaction in terms of profit or revenue growth,” Singh explains, “then you can attach
customer values to profit & loss and to the balance sheet.”
