Page 7 - Supply Chain Magazine
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increasing their customer base. So companies try to manufacture better
products at competitive rates to gain new customers and to hold on to
the old ones.
3. Improvement in technology: in order to survive in the fiercely competitive
global market, companies have to invest in technology and quality
operations thereby giving better products to the consumer.
4. Better Performance: this global exposure makes every company to
enhance its product quality and improve performance. They have to
continuously explore avenues to manufacture better products and
provide the customers what they really need on time, every time.
The global supply management system opens up new business vistas not only for the
parent company but is also responsible for providing each trader to give his best so that
the entire chain works in a coherent and seamless manner. In this system, each one
benefits provided each one contributes on time.
How should the supply chain be measured and monitored?
Measurement is important, as it affects behavior that impacts supply chain performance.
As such,performance measurement provides the means by which a company can
assess whether its supply chain has improved or degraded.
But a variety of measurement approaches have been developed, including the following:
● The Balanced Scorecard
● The Supply Chain Council’s SCOR Model
● The Logistics Scoreboard
● Activity-Based Costing (ABC)
● Economic Value Analysis (EVA)
The Balanced Scorecard recommends the use of executive information systems (EIS)
that track a limited number of balanced metrics that are closely aligned to strategic
objectives. The approach would recommend that a small number of balanced supply
chain measures be tracked based on four perspectives:
● Financial perspective
● Customer perspective
● Internal business perspective
● Innovative and learning perspective
The Supply Chain Council’s SCOR Model provides guidance on the types of metrics
one might use to get a balanced approach towards measuring the performance of one’s
overall supply chain.The SCOR Model approach advocates a set of supply chain
performance measures comprised of a combination of:
