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What is a supply chain?
The supply chain is a network of facilities and processes that procure goods, transform them into functional use, and distribute them to customers/consumers. It requires orchestrating processes across a complex network of suppliers, manufacturers, distributors, retailers, wholesalers, and customers. It involves procuring necessary materials, manufacturing the products, storing them, transporting them, and delivering them to customers.

What are the characteristics of an effective supply chain?
An effective and optimized supply chain will enable organizations to deliver the right product in the right quantity and condition to the right place at the right time and price. The objective is to minimize costs, waste, and time to increase profitability and gain a competitive advantage.
Supply chain management requires companies to anticipate and mitigate risks to prevent disruptions. Supply chain processes are also expected to ensure compliance with local government laws. In addition, there is a growing awareness of global warming and the need for a sustainable supply chain that enables companies to reduce their carbon footprint and environmental impact.

What are digital supply chains?
Digitization of supply chains includes advanced analytics, automation, and machine learning, that can help operations become more productive, flexible, resilient, and sustainable. The digital supply chains enable seamless communication across the supply chain partners and improve decision-making. Using digital supply chains, organizations can reduce inventory, reduce manufacturing/distribution costs, and improve quality.

What are the main functions of a supply chain?

Planning
Many organizations have a Sales and Operational Planning function (S&OP) that serves as a conduit between manufacturing/procurement and Sales/Marketing functions. Planning involves forecasting customer demand, capacity planning, planning production, and managing inventory levels to ensure the right products are ready to meet customer demand.

Procurement/Sourcing
Sourcing is the process of finding, evaluating, selecting, and contracting with suppliers that provide raw materials or components to manufacture goods or services. Sourcing activities include market research, supplier qualification, negotiation, contracting, ordering, payment, and performance evaluation.

Manufacturing
Manufacturing transforms raw materials into finished products. It involves production planning, scheduling, material handling, assembly, quality control, packaging, and labeling.

Logistics/Transportation
Logistics includes planning, coordinating, and executing the movement of goods or services from one location to another. The activities include transportation planning, routing, loading, tracking, delivery confirmation, and returns.

Warehousing/Distribution
Distribution or delivery involves storing and distributing goods or services to consumers (B2C), and customers (B2B). The activities include warehousing, inventory management, order fulfillment, picking, packing, shipping, receiving, and replenishment.

Other Dependent Functions
Supply Chain plays a critical role in supporting many other organizational functions.

Product Development
Organizations continue to innovate and introduce new products and services. Product development involves designing, developing, testing, and launching new or improved products or services that meet customer needs and expectations. The supply chain plays a critical role in ensuring the required raw materials can be procured, manufactured, and delivered to customers at acceptable cost.

Sales and Marketing
Marketing enables organizations to communicate value propositions to customers or potential customers. Sales/Marketing involves market segmentation, targeting, positioning, branding, pricing, promotion, advertising, sales and customer relationship management. The supply chain must ensure product availability and on-time delivery to keep customers happy.

Customer Service
Customer Service involves supporting the customers before, during, and after they purchase a product or service. Customer service activities include product inquiries, order processing, complaint resolution, returns, and warranty/repair services. The supply chain must ensure the orders are fulfilled as per customer needs, and any returns are processed quickly.