PGCM (S4) 01-2 Sales, Distribution and Supply Chain Management SEMESTER - IV MASTER OF COMMERCE BLOCK - 2 (Marketing Sepecialisation) KRISHNA KANTA HANDIQUI STATE OPEN UNIVERSITY PDF created with pdfFactory Pro trial version www.pdffactory.com Subject Experts Prof. Nripendra Narayan Sarma, ManiramDewan School of Management, KKHSOU. Prof.U.RDhar, Retd. Professor, Dept of Business Administration, GU. Prof. Mukulesh Baruah, Director, Assam Institute of Management. Course Co-ordinator : Dr. Smritishikha Choudhury, Asst. Prof., KKHSOU SLM Preparation Team Dr. Chayanika Senapati, Asst. Prof., KKHSOU UNITS CONTRIBUTORS 8-15 Dr. Rashida T.Noorain, ARGUCOM Editorial Team Content : 8-15 Dr. Devajit Goswami, KKHSOU Language : 8-15 Dr. Sarat K. Doley, Tezpur University Structure, Format & Graphics: Dr. Smritishikha Choudhury, KKHSOU Dr. Chayanika Senapati, KKHSOU March, 2020 ISBN : 978-93-89955-57-6 This Self Learning Material (SLM) of the Krishna Kanta Handiqui State Open University is made available under a Creative Commons Attribution-Non Commercial-Share Alike 4.0 License (international): http://creativecommons.org/licenses/by-nc-sa/4.0/ Printed and published by Registrar on behalf of the Krishna Kanta Handiqui State Open University. Headquarters: Patgaon, Rani Gate, Guwahati-781017 City Office: Housefed Complex, Dispur, Guwahati-781006; Web: www.kkhsou.in The University acknowledges with thanks the financial support provided by the Distance Education Bureau, UGC for preparation of this material. PDF created with pdfFactory Pro trial version www.pdffactory.com MASTER OF COMMERCE Sales, Distribution and Supply ChainManagement Block 2 DETAILEDSYLLABUS Page No. Unit 8: The Basics of SupplyChainManagement Page No. 125-142 Introduction, Definition of Supply Chain Management, Evolution of the Concept of Supply Chain Management, Key Drivers of Supply Chain Management,TypologyofSupplyChains,ProcessViewofSupplyChain, Challenges inSCM Unit 9: New Paradigm in Inventory andPurchaseManagement Page No. 143-152 Introduction,Definition,SelfcertifiedVendors,GreenChannelSuppliers, VendorManagedInventory,GreenLogistics Unit 10: Planning DemandandSupply Page No. 153-172 Introduction, Demand Management, Demand Forecasting, Supply Management,EvolutionofERPinSupplyChainManagement,Strategies for Enhanced Performance of SupplyChains Unit 11: Procurement andInventoryManagement Page No. 173-196 Introduction, Objectives of Procurement and Inventory Management, Procurement Cycle, Inventory Management, Inventory Costs, Types of Inventory Models, Inventory Control Systems, Tools of Inventory Management. Unit 12: Marketing andLogisticInterface Page No. 197-210 Introduction, Customer Service, Costs and trade offs in Service Offerings, Service driven Logistic system, Supply Chain Performance. Unit 13: SupplyChainBenchmarking Page No. 211-121 Introduction,Understanding the Bench marking Concept, Bench marking Process, Benchmarking Procedure Unit 14: Recent Trends in SupplyChainManagement Page No. : 222-238 Introduction, New Developments in Supply Chain Management, Outsourcing Supply Chain Operations, Co-Maker ship, The Role of E- Commerce in Supply Chain Management, Green Supply Chain Management, Distribution Resource Planning, World Class Supply Chain Management Unit 15: CaseStudy Page No. 239-248 Introduction, Cases: Bishkoot Pau, Shyam Tea, Assam Weaves PDF created with pdfFactory Pro trial version www.pdffactory.com BLOCK INTRODUCTION This is these cond block of the course "Sales, Distribution and Supply Chain Management". The Block is divided into7 units and is primarily a learner oriented Selfl earning material, asitsatisfies the requirements of the learners in the filed of Marketing. This block comprises of the following eight units: The first unit of this block that is eighth unit of this course introduces us to the concept of Supply Chain Management The ninth unit gives us a broad idea of Inventory management andGreen logistics. The tenth unit is about Planning Demand and Supply. This unit explains demand management, demand forecasting, supply management and evolution of ERP. Theeleventhunitwillhelpusinunderstandingprocurementandinventory management. The twelfth unit is about marketing and Logistic interface. The thirteenth unit will help us in understanding the Bench marking Concept, Bench marking Process, Bench marking Procedure. The fourteenth unit is about recent trends in Supply Chain Management, which explains concepts like e- commerce, green supply chain etc. The last unit of this block discusses some cases related to this course. Each unit of these blocks includes some along-side boxes to help you know some of the difficult, unseen terms. You may find some boxes marked with: "LETUSKNOW". These boxes will provide you with some additional interesting and relevant information. Again, you will get "CHECK YOUR PROGRESS" questions. These have been designed to self-check your progress of study. It will be helpful for you if you solve the problems put in these boxes immediately after you go through the sections of the units and then match your answers with "ANSWERS TO CHECK YOUR PROGRESS" given at the end of each unit. you in making your learning more active and efficient. And, at the end of each section, you will get "CHECK YOUR PROGRESS" questions. These have been designed to self-check your understanding. The Block is divided into eight units: Unit8:Basics of Supply Chain Management Unit9:New Paradigmin Inventory & Purchase Management Unit10:Planning Demand andSupply Unit11:Procurement and InventoryManagement Unit12:Marketing and LogisticsInterface Unit13:Supply Chain Bench marking Unit14:Recent trends in Supply Chain Management Unit15:Case Study PDF created with pdfFactory Pro trial version www.pdffactory.com Basics of Supply Chain Management Unit 8 UNIT 8: BASICS OF SUPPLY CHAIN MANAGEMENT UNIT STRUCTURE 8. 1 Learning Objectives 8. 2 Introduction to Supply Chain Management 8. 3 Evolution of the Concept of Supply Chain Management 8. 4 Drivers of Supply Chain Management 8. 5 Typology of Supply Chains 8. 6 Process View of Supply Chain 8. 7 Challenges in Supply Chain Management 8. 8 Bullwhip Effect 8.8.1 Causes of Bullwhip effect 8.8.2 Handling Bullwhip effect 8. 9 Let Us Sum Up 8. 10 Further Reading 8. 11 Answers to Check Your Progress 8. 12 Model Questions 8. 1 LEARNING OBJECTIVES After going through this unit, you will be able to: l understand the basics of Supply Chain Management l explain the concept of Supply Chain Management and its importance l describe the typology of supply chains l explain the cycle view of supply chain l learn the different drivers of supply chain management l understand the concept of bullwhip effect in supply chain 8. 2 INTRODUCTION TO SUPPLY CHAIN MANAGEMENT Supply Chain Management is a process ensuring a smooth flow of goods and information along the chain from supplier/producers’ end to the customers’ end. The process is an integrated whole of various business functions including customer orders, distribution, logistics, delivery of goods, Sales, Distribution and Supply Chain Management 125 PDF created with pdfFactory Pro trial version www.pdffactory.com Unit 8 Basics of Supply Chain Management alongside the flow of information pertaining the sales data, orders received, replenishment data, etc. The process closely monitors the information flow at various stages of the process. To be specific Supply Chain Management can be defined as: “An integrated whole of processes that integrates components of producers/suppliers, manufacturers, distributors, transporters, etc. to ensure smooth flow of goods and services at the customers’ end at the expense of minimum resources and in desired time, quantity and locations”. Value Chain: Supply chain refers to the entire chain of activities of goods or services from manufacturing to the delivery at the customers’ end. It involves resource optimization with service level. Value Chain in contrast pertains to each stage/component within the supply chain. According to Michael Porter, value chain receives materials/semi-finished goods to add value through different processes to provide a value-added product to its customers. Competitiveness to a firm is obtained through cost effective delivery of goods and services. Any industry has a set of primary activities (inbound logistics, operations, outbound logistics, sales, and service) and support activities(procurement, technology, firm infrastructure, human resource management). Of all the activities a firm is generally efficient in performing a few of the activities effectively and efficiently than its competitors. It, therefore, follows that the firm ought to focus on activities of inherent expertise and obtain the other activities from external partners. In the process the necessity of a strong relationship with the partners can prove make or break relationship in the market. This is because a healthy relationship with the partners can be complementary to the activities of the firm. The role of supply chain management is more pronounced herein. A tightly associated relationship can ensure smooth flow of goods and service at the right place, at the right time and in right quantities. 8. 3 EVOLUTION OF THE CONCEPT OF SUPPLY CHAIN MANAGEMENT The evolution of Supply Chain Management could be traced to the 126 Sales, Distribution and Supply Chain Management PDF created with pdfFactory Pro trial version www.pdffactory.com Basics of Supply Chain Management Unit 8 period wherein production and marketing of goods proliferated. This leads to the