What does SCM mean in BUSINESS

Supply chain management (SCM) is the process of overseeing and managing the various parts of a supply chain, including suppliers, warehouses, manufacturers, distributors, retailers, customers - all of which are connected by physical and digital technology. It involves planning and controlling the flow of goods from product inception to customer delivery in order to meet customer satisfaction goals and maximize profitability.

The goal of supply chain management is to ensure that products or services reach customers with greater efficiency and accuracy than before. This includes cost savings on raw materials, transportation costs, inventory holding costs and more. Additionally, SCM provides improved customer service through faster delivery times and better communication with suppliers.

Organizations use SCM to reduce their total cost of procurement while creating higher value for customers. By optimizing their supply chains, organizations can gain competitive advantages in cost structure and flexibility in responding to customer demands. SCM can also help create an efficient network where information flows quickly from start to finish in the supply chain.

An effective SCM should have a number of key components including inventory control, supplies procurement planning, warehouse management systems (WMS), production planning systems (PPS), transportation networks optimization solutions (TNOSs), customer service resources management solutions (CSRMs), collaborative forecasting systems (CFSs), interface tracking solutions (ITSs), quality assurance tools/processes/standards (QAT/P/Ss)

Managing a successful supply chain has traditionally been hindered by many unpredictable factors including unstable market demand due to shifts in consumer trends or seasonal variations; problems arising from globalized sourcing such as unreliable quality control or delays due to distance; rising costs associated with providing adequate infrastructure support; risks associated with loss prevention during transit or storage; over-dependence on fewer suppliers resulting in increased vulnerability; lack of real-time visibility into logistical operations leading to inaccurate forecasting; wrong selection or implementation of technology resulting in costly disruptions; limited resources leading to poor negotiation power with suppliers; data siloing preventing holistic insights into operations etc.