What Is Supply Chain & Why is It Important?
Definition of Supply Chain
A supply chain is the network between a company and its suppliers and customers that includes all the transactions involved in transforming raw goods into a salable products.
The network includes the activities, people, technology, information and resources, while the functional teams involved in the company’s network includes sales, sourcing, procurement, production, logistics and customer service.
Supply chain management is the coordination, management and strategy that drives the flow of data, information, resources and materials to deliver the best product and service to all stakeholders in the process of converting raw goods to a salable product and delivering it to the ultimate customer.
When the activities of a company’s supply chain are brought together into a single vision, supply chain management drives a competitive advantage by executing faster, reducing friction through all internal and external points, thus bringing more transparency throughout the process to deliver a product or service that is beyond expectations of the end customer.
Third party logistics companies (3PL’s) have transformed their business models over the past decade to encompass the new vision of supply chain management by offering the market powerful cloud technology platforms and connected systems.
Leaders in supply chain management understand their company's supply chain is more than the movement of goods from raw materials to finished goods. These innovators bring together the internal and external business processes and networks associated with delivering the best service and product under a single collaborative system that delivers the ultimate customer experience.
By streamlining and coordinating the supply and demand side of service and product activities to maximize the customer experience a company builds a competitive advantage in the marketplace.
Additional Topics of Interest
- What is the Difference in Logistics & Supply Chain?
- Logistics and Supply Chain Management - Comprehensive Guide
- Ways a TMS Benefits a Company's Supply Chain
- Importance of Order-to-Cash Cycle in Logistics & Supply Chain
- Best Freight, Logistics & Supply Chain Cost Savings Guide
Professional Organizations Associated with 3PL's and Supply Chain Management Include:
- Counsel of Supply Chain Management Professionals (CSCMP)
- Transportation Intermediaries Association (TIA)
- International Warehouse Logistics Association IWLA)