The competition isn’t between a business and another company but involving supply chains in business today. A supply chain is a system of suppliers’ factories, distribution centers, retailers, and warehouses. This is where raw materials are acquired, transformed, produced and also delivered to customers. A supply chain is a dynamic process and involves the constant flow of information, materials, and funds across the many functional areas within and among chain members. The members in the series should cooperate with their business partners in order to meet the needs of customers and to be able to optimize profits. Managing the collaboration in a supply chain is a very difficult task because of the involvement of many parties. The parties each have resources and their own goals.
There is no single authority over all the chain members when it comes to chain supply. Cooperation is made through negotiation and not central management and control. The process which takes place in different stages requires real-time cooperation in the operation and decision-making of the different functional areas, tasks, and organizational boundaries. This is to be certain that they’ll have the ability to manage doubts and issues arising. The focus ought to be on quick responses and services will be achieved with collaboration and lively formation of supply chains.
In increasing the responsiveness to the changing industry to the business conditions, supply chain management in Mexico has come to be a highly effective technique. It also enhances these businesses’ competitiveness. Today there is intense competition and the global economy is increasing. For a company to grow and survive, it eventually become price competitive and should boost its market responsiveness. Supply chain management is a method of breaking down the linked set of values creating activities from raw materials to the end products that reach the consumers.
A supply chain will link manufacturers, retailers, customers and suppliers in the chain. This aids in delivering and creating goods as a single company of abilities to bring together skills and resources. Supply chain management is a process which is related to flow of information from low-level component suppliers’ in the manufacturing line to end customers and synchronizes the flow of physical goods. This results in the early provision of notices of demand fluctuations and synchronizing the processes of the business.
Supply chain management’s significance and need increases in future. This is because customers will be demanding faster delivery of orders. Producers will need to have greater knowledge of order requirements to be able to better plan its processes and operations. Also, the external entities need to increase coordination among the customers, suppliers and service providers. This will guarantee that there are coordination and visibility through the distribution chain.