Introduction
Supply chain management is an integrated process that ensures proper distribution of goods and services to consumers. It involves holistic integration of activities from the point of acquisition of raw materials, manufacturing and distribution to the end users.
Indeed, the process that requires managers to execute effective planning, designing, control and monitoring of supply activities is instrumental for an organization that seeks to record high performance. This is evident since it provides requisite incentives that promote efficiency and quality service delivery.
Strategic implications of how an organization produces and interacts with its partners, customers, and suppliers
As noted by scholars, value chain management can only present positive implications if interaction between key partners such as customers, suppliers and employees is cordial and if they are involved in policy formulation. Similarly, it can be successful if there is proper communication between the stakeholders (Wailgum, 2008).
This is significant since all the stakeholders have a role to play in enhancing profitability and sales levels that remains its key positive implications. Without exemplary interaction between stakeholders, an institution may face immense complications that may jeopardize its performance significantly. Firstly, such a company cannot meet the needs of its customers appropriately due to laxity in service delivery.
Supply of raw materials and finished items would also be affected if suppliers are not treated with decorum. This has affected operations in most institutions since suppliers are the ones who connect companies with customers and producers of raw materials (Wailgum, 2008). Thirdly, inferior interaction between partners affects effective execution of marketing and promotional activities in institutions.
Variably, poor coordination, understanding and interaction with consumers also present far reaching effects that include reduction in sales volumes that in turn leads to low revenue levels. It also affects the flow of goods that may make a company to have a lot of dead stock in its go downs.
How institutions can optimize supply chain management to improve results
Indeed, supply chain management is critical since it defines how successful an institution can be in terms of profitability. It also defines how an organization can be able to meet the needs of its customers in a more systematic manner that is based on quality ideals (Mentzer, 2001).
However, effective optimization of supply chain management requires proper coordination of activities, planning and putting in place requisite logistical measures.
It also requires proper understanding among stakeholders, development of appropriate procurement policies and integration of information technology systems. These are important elements that affect the execution of supply of services in various institutions. (Kumar, 2005)
Therefore, managers in diverse institutions should develop proper operating structures to help in addressing evident issues that may affect the realization of exemplary results as evident in Toyota Company when it had to recall some of its vehicle brands for quality check.
The company is currently, streamlining its supply chain management system through systematic stakeholder interaction process that enables it to deliver acceptable products real time.
Similarly, Dell Corporation has also embarked on a strategic plan to boost its supply chain management process. It seeks to integrate effective logistical measures to promote the acquisition of raw materials, foster manufacturing process and delivery to consumers.
Conclusion
Evidently, effective supply chain management ensures that best practices are adhered to within the supply network.
It also ensures that quality of service delivery is highly maintained and that due processes are followed when distributing products to consumers. Therefore, Institutions are under obligation to adopt noble supply chain management practices to enable them record good performance and achieve competitive advantage.
References
Kumar, S. (2005). Parts Management Models and Applications: A Supply Chain System Integration Perspective. New York: Springer.
Mentzer, T. (2001). Supply Chain Management. Thousand Oaks, Calif. [u.a.: Sage Publ.
Wailgum, T. (2008). Supply Chain Management Definition and Solutions. Retrieved from <https://www.cio.com/>