Center for Supply Chain Management

What is Supply Chain Management?

Supply Chain Management has evolved as a global professional management discipline, and now represents a strategic advantage and source of business success for many companies. What began over forty years ago as independently managed (silo’d) business functions of purchasing, operations, inventory management/warehousing, customer service and logistics within a firm has evolved into a highly sophisticated, technology-dependent, collaborative professional discipline focused on managing the physical flows of goods, the flows of information, and the flow of cash internal to the firm and among external partners around the globe -- while exceeding customer expectations at the lowest total cost possible. Supply chain managers face challenges across operational, tactical and strategic levels of business decisions.

In good times and bad, supply chain managers are asked to address the conflicting needs of the business – continuously higher levels of service at continuously lower costs. “Best-in-class” companies use supply chain management as a competitive weapon – Apple, Dell, Proctor & Gamble, IBM, Cisco Systems, Nokia, Wal-Mart Stores, Samsung Electronics, PepsiCo, Toyota Motor, Schlumberger, and Johnson & Johnson lead-off AMR Research’s “Supply Chain Top 25”. Supply chain tactics employed by these firms and others include: build-to-order business models, content-based value chains, risk management, supply chain agility, low-levels-of-inventory, digital-inventory, deep-supplier-collaboration, demand/supply-balancing and demand-driven technologies and processes, direct-store-delivery, supply chain data-mining, sustainability, extension of lean principles into the company’s total value chain, the “perfect order”, “time-to-value”, and others. Whether the company has a “growth mode” or a “recession mindset”, supply chain managers are called on to meet high levels of expectations. In most companies, talent management is a priority, and supply chains – due to their encompassing view of the organization – have become “people supply chains” for the business.

Financial Impact of Best-in-class SCM

Companies ranked as Best-in-Class in supply chain management consistently outperform the stock market. Key financial metrics include Revenue Growth, Return-on-Assets, and Inventory Turns. Included in most management systems are optimal procurement practices, low operating costs, low inventories, low transport costs, and high levels of customer service. In all dimensions of the business, business and financial risk are identified, measured and managed. Pursuit of optimal metrics takes supply chain managers outside of the firm and around the world.

Distinct requirements of SCM professionals

(ISM, 12-08)

Expectations of graduates of supply chain programs are high across four distinct requirements:

  • Solid Business Education: supply chain management principles and practices across all functional areas of supply chain management, negotiations, cost management, supply strategy and analytics. 
  • Strong communication skills: strong interpersonal skills; effective communication skills to present ideas in a constructive manner both orally and written; and, the ability to prepare and deliver presentations.
  • Evidence of experience: active involvement in internships, part-time work, and extra-curricular activities; evidence of teamwork and leadership capabilities and experience; demonstrated ability to manage time and priorities; and a demonstrated understanding of winning versus losing.
  • Strong relationship-building skills: understands the value-drivers of relationships; and demonstrates capabilities to translate value into benefits for stakeholders – a supply chain manager must be seen by others as someone who adds value to the overall organization.