Question

Identify the nature of supply chains for service providers as well as for manufacturers? give your knowledge on this question and how this question relates to you.

Answer 1

• To understand the role of Supply Chain Management in Manufacturing and Service Organisations

• To assimilate differences and similarity between Supply chain and logistics

• To know the impact of Supply Chain in gaining competitive advantage

The service industry has increased quickly and will surpass the Manufacturing organization, and its contribution to economic growth is increasingly obvious. Service supply chain which refers to a new supply chain, including information management, process management, competency management, service performance, and treasury management that occurs in professional services, from the upper stream supplier to the downstream customer.

Nowadays, the definition of service supply chain has been extended, which includes Service Only Supply Chains (SOSCs) and the Product Service Supply Chains (PSSCs). In the aspect of SOSCs, service supply chain system is defined as “a network of suppliers, service providers, consumers, and other supporting units that performs the functions of transactions of resources required to produce services; transformation of these resources into supporting and core services; and the delivery of these services to customers”. An application service supply chain is defined as a system composed of three parties: the service producer for infrastructure, the retail service provider, and the customer. In the real world, these kinds of service supply chains can be found in industries such as finance, telecommunication, Internet service, mobile apps, and tourism. In the aspect of PSSCs, many PSSCs manage physical products together with significant service considerations. Thus, there are both “services” and “physical products” in these supply chain systems. Arguably, there are more PSSCs than SOSCs explored in the literature. For example, we can find PSSCs in restaurant and food retail supply chains, product design and retailing supply chains, logistics service supply chain, and hotel supply chain.

Service supply chains and manufacturing supply chains both belong to the field of supply chains. However, in the existing literature, supply chain management in the manufacturing industry is far more studied than supply chain management in the service supply chain. Some researchers state the reasons that there are differences between service supply chain and manufacturing supply chain. However, there still exist similarities and relations between service and manufacturing supply chain. Many studies in service supply chain have been inspired by these similarities and relations and made new explorations. For example, the bullwhip effect in a service supplies chain, deriving from studies of make-to-stock manufacturing supply chains. A conceptual model of the influence of control power on the performance of service supply chains was developed, based on the modeling method from manufacturing supply chain. Therefore, many sustainable supply chain management methods in the manufacturing industry are very helpful in exploring the sustainable service supply chain research. In this section, we will analyze those chosen papers. From a sustainable and supply chain management point of view, we will review papers considering two or three bottom lines.

At the most fundamental level, supply chain management (SCM) is management of the flow of goods, data, and finances related to a product or service, from the procurement of raw materials to the delivery of the product at its final destination.

Although many people equate the supply chain with logistics, logistics is actually just one component of the supply chain. Today’s digitally based SCM systems include material handling and software for all parties involved in product or service creation, order fulfillment, and information tracking―such as suppliers, manufacturers, wholesalers, transportation and logistics providers, and retailers.

Supply chain activities span procurement, product lifecycle management, supply chain planning (including inventory planning and the maintenance of enterprise assets and production lines), logistics (including transportation and fleet management), and order management. SCM can also extend to the activities around global trade, such as the management of global suppliers and multinational production processes.

SCM has historically been about increasing efficiency and reducing costs. Although those needs haven’t changed, what has changed is that the customer is now playing a front-and-center role in setting SCM priorities. It’s been said that “customer experiences live and die in the supply chain.”

Customer loyalty is predicated on an enterprise being able to quickly and accurately fulfill customer expectations. Raw materials, manufacturing, logistics, and trade and order management must all be coordinated to get a given item to the customer within a reasonable timeframe. To accomplish this, companies must look at their supply chains through their customers’ eyes. It’s not simply about getting the order to the customer on time; it’s about doing everything at the right time—before, during, and after order delivery.

The supply chain of the future is all about responsiveness and the customer experience― understood and managed within a network rather than a linear model. Every node of the network must be attuned and flexible to the needs of the consumer while also being capable of addressing factors such as sourcing, trade policies, modes of shipment, and more.

Advanced technology will increasingly be used to improve transparency and visibility throughout this network, as well as to further enable connectivity and SCM utilization. The entire SCM planning function will become more intelligent to take consumer demands into account. The ability to adapt will be a mandate.

In the past, supply chain planning has been a periodic business exercise. Heading into the future, it will be continuous. Future SCM systems will also bring tighter alignment between planning and execution, which is not a current state for most enterprises. The need for speed and accuracy in SCM is only going to increase. Make sure your supply chain is ready for the future by supporting it with an intelligent SCM system.

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