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Use of Supply Chain Management as a Method of Inventory Control - Research Paper Example
Finance & Accounting
Pages 8 (2008 words)
In the current environment of highly competitive business and advancing technology, coordination across different business processes and operations have become vital ingredient of business strategy…
Use of Supply Chain Management as a Method of Inventory Control
The emerging role of supply chain as integral part of inventory control has become hugely relevant issue for businesses. Indeed, successful SCM not only improves productivity but also provides the business with long term sustainability in the highly competitive business environment. The fast transforming business dynamics, including rapid globalization, technology and diversity in product variety and short life span have all contributed towards tough market conditions (Lee, 2002). Thus, challenges of effective SCM, especially as a key method of inventory control, have become major issues to improve and improvise inventory management in order to optimize performance outcome and maintain competitive edge. Supply chain and its impact on inventory control Supply chain and inventory management are intrinsically linked to the wider goals and objectives of the business. Supply chain or the logistics can broadly be defined as ‘set of approaches utilized to efficiently integrate suppliers, manufacturers, warehouses, and stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at the right time, in order to minimize system-wide costs while satisfying service level requirements’ (Simchi-Levi, Kaminsky, & Simchi-Levi, 2003, p. 1). The various imperatives of SCM are mainly designed to meet the changing needs and requirements of the customers. ...