Supply chain management encompasses many activities that are put together to ensure consumers get their products in a timely manner. Not surprisingly, many business entities consider supply chain an integral part of their production process. Supply chain plays a major role in customers’ satisfaction as well as contributing to the organization’s bottom line. It helps lower the cost of doing business and this gives business organizations a position where it can create competitive advantage over other players in the industry.
Ross (2016) states that the good supply chain management is important as it makes it possible for an organization to be successful and gain competitive advantage without necessarily lowering the prices of its products. They can attain this by improving on three aspects. The first one is that good supply chain helps improve customer service. Customers expect to receive products in a timely manner whenever they are and this helps in improving customer satisfaction. The second aspect it improves is it lowers operation costs. Good supply chain enhances efficiency and this helps in the reduction of operation costs incurred by an organization. Supply chain management also improves an organization financial position as chain supervisors are tasked with the responsibility of reducing and controlling costs and this leads to an increase realized profits.
Supply chain management managers face a number of problems in implementing good supply chain systems. One major challenge faced by these managers is the issue of globalization (Ross, 2016). Globalization has led to increased markets where people living in far-flung areas can buy products through online channels and it is the responsibility of the supply chain managers to come up with ways to ensure the customers receive their products in a timely manner.
Lack of resources is another major challenge faced by supply chain managers. Supply management involves a complex network of strategies and mediums put in place to ensure that clients receive their goods in a timely manner and in competitive prices (Shah, 2015). This requires many resources in terms of finances and work force. In many instances, these resources are not readily available making it hard for mangers to implement good supply chains for their organizations.
Many companies have been successful in implementing successful supply chains and two of them are the Coca-Cola Company and Colgate. Coca-Cola Company is located in Atlanta, Georgia but its products are to all the corners of the world. The company has a supply chain that is in line with the segmentation strategy where each region produces and distributes the company products (Shah, 2015). This has been very successful and it is very hard to go to any place around the globe and find it hard to get the company’s products. Colgate toothpaste is manufactured by Colgate-Palmolive and it has a very successful supply chain (Ross, 2016). The company has employed a distribution strategy that incorporates all aspects of care and maintenance. The company ensures that its flag product is sold in all selling points like supermarkets, convenience stores, pharmacies, and small wholesalers. This has helped the organization to create an impact in the market where its product is always available and visible to the target consumers (Shah, 2015).
Ross, D. (2016). Introduction to Supply Chain Management Technologies. New York, NY: CRC
Shah, J. (2015). Supply Chain Management: Text and Cases. Chicago, IL: Pearson Education
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