supply chain management

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Supply Chain Management

The act or process of ensuring that one's business has the proper supplies in order to continue operations. Supply management involves ensuring that supplies are procured as cheaply as possible. For example, a construction company must procure cement, wood, and nails efficiently and inexpensively; equally, a consulting firm must make sure that research materials are easily available. Large companies often devote whole divisions to supply chain management, giving them budgets of millions of dollars to help the company save money.

There are two basic types of supply chain management: just in time and just in case. A just in time supply chain management strategy involves keeping only enough inventory to meet immediate business needs. This requires constant monitoring but can save a significant amount money. A just in case strategy, on the other hand, keeps a larger inventory to meet unexpected increases in demand. This saves less money (depending on the nature of the business and matters like carrying costs) but can be easier to manage.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

supply chain management

a term used to describe the management of inventory (STOCK), not only within a firm but also along the network of suppliers and customers which constitute the SUPPLY CHAIN or VALUE-ADDED CHAIN. Supply chain management employs a variety of methods such as STOCK CONTROL, MATERIALS REQUIREMENT PLANNING and DISTRIBUTED REQUIREMENT PLANNING to both minimize stock-holding costs while maintaining effective distributed levels of servicing customer orders. See SUPPLIER DEVELOPMENT.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson
References in periodicals archive ?
A total of 50 per cent of CPOs and CPMs surveyed stated that they still use their e-procurement systems for purely transactional - and not strategic - purposes.
The contract will comprise the entire e-procurement requirement of the company including capital expenditure, operational expenditure, and services.
Some companies already apply procurement compliance rules, but what makes e-procurement unique is the value it gives to the organizations as stated previously.
E-procurement is the term applied to conducting transactions between authorities and suppliers over the Internet.
In addition, the number of purchase orders processed per procurement full-time equivalent employee (FTE) is significantly higher among organizations using e-procurement systems.
Both the EU's Digital Agenda and the action plan for 2011-2015 for online administration showed the importance of interconnecting the means of e-procurement. Therefore, the Commission is proposing moving over completely to e-procurement by mid-2016.
The online presentation was designed to provide Procurement and Strategic Sourcing leaders with the data points needed to achieve best-in-class e-Procurement. The research was compiled from the survey responses of over 150 Procurement, SCM, Finance, and IT executives from mid- to large-sized organizations in North America, Asia, and Europe.
The findings have shown that there is a gap between suppliers and the procurement departments in using these latest e-procurement solutions, although the trend is catching up.
MANAMA: Tamkeen is working closely with a selection of Bahrain's larger companies to collaborate on developing an e-procurement marketplace.