‘Supply Chain Management’ or SCM as it is commonly known in today’s business world is a complex set of strategic activities which interlinks two or more departments to achieve a seamless and cost effective way to establish uninterrupted flow of raw materials or finished goods in any manufacturing or consumer business.
The term supply chain management was coined by Keith Oilver in 1982 and only gained popularity in mid 1990s when companies started realizing the necessity for establishing more reliable supply lines in increasing global competition.
Supply chain is categorically divided into two major operations.
1.Upstream supply chain.
2. Down stream supply chain.
Up Stream Supply Chain: Up stream supply chain deals with part of Supply chain network which constitutes the suppliers and supplier’s supplier, this could be well treated as behind the scene network and generally a part of ‘Pre-Manufacturing’ process. this network is commonly set-up to secure the effective supply of raw materials and manufacturing related products and services.
Down Stream Supply Chain:Down stream supply chain is all about Post manufacturing supply chain network and includes delivery of products and services to the consumer, this could include the distribution network to wholesalers, Retailers and end customers.
The activity between these two categories is generally termed as’Work In Progress’ or ‘WIP’, and in this phase of supply chain the transition from Up Stream to Down stream generally happens.
Aligning and managing all the above explained individual activities to form a bigger and effective process is called ‘Supply chain management’.
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