In the era of globalization and fluctuating markets supply chain management is becoming significant to
the corporate world. Supply chain management is the integration of all key business activities through
improved relationship at all levels of supply chain. There are four important drivers of supply chain
performance—Facilities, Transportation, Inventory and Information. This article appraises how auto
component industry is performing in terms of supply chain based on four major supply chain performance
drivers. It also studies how different tools and techniques are used to enhance the performance of the
supply chain in auto component industry.
Today’s business world is defined by change. Externally, there are powerful and global
competitors, influential customer demanding more complex and varied services at less
cost, and the increasing implications of mergers and acquisitions. Internally, there are
stockholders requiring a constant increase in returns. The future success of an individual
company depends on its ability to weather and manage the forces of change. When a
company finds itself struggling to maintain profit margins, a renewed focus on supply
chain strategy becomes the optimal way.
A supply chain consists of all stages involved, directly or indirectly, in fulfilling a
customer request. The supply chain not only includes the manufacturers and suppliers, but
also transporters, warehouses, retailers, and customers themselves. Within each organization,
such as a manufacturer, the supply chain includes all functions involved in filling a
customer request. These functions include, but are not limited to, new product
development, marketing, operations, distributions, finance, and customer service.
Enhancing customer service/satisfaction outscores all other objectives in terms of their
effectiveness to the supply chain management. At the same time, expanding revenue,
reducing inventory cost and improving on-time delivery follow closely in terms of supply
chain priorities. Undoubtedly, all the four objectives stated above are the most vital and
basic criterion for any supply chain management strategy to produce tangible results.
Improvements in these metrics have a direct effect on the bottom line of the organization. |
