Understanding The Supply Chain Process
What is Supply Chain and what can it do for you? In business, a distribution chain is simply a network of people, actions, goods, information, and tools involved in the generation, transportation, processing, sale and consumption of a product. The more components of a business has the easier it is to understand why the system functions as it does.
Think of the grocery store as a perfect example of a fully integrated chain. At one point in the chain of the order is taken through a single point where items are picked up and moved on to the next location. It is at this point that the various components of the chain begin to interact and interlock with each other.
Within a typical company, the production of goods, whether it be goods manufacturing or goods consumption, is separated into different departments so that the company as a whole can operate in the most cost effective manner possible. This division of labor allows for optimal use of the company’s machinery and manpower in producing the goods they need. It also allows the company to change the way they are producing their products in response to changes in consumer demand or in the economic structure of the marketplace.
The problem that arises though from this idealistic view of production and how it should function is that there is an inherent conflict within the company. One faction wishes to maintain the status quo and produce a product at the lowest possible cost while another faction would like to increase the amount of output produced in a short period of time. If one of these factions wins the struggle, then there will be a decrease in overall quality of production.
The components of the supply chain are then required to work together in order to bring about the best possible product at the lowest overall cost. When this occurs, there are increased efficiency, the elimination of waste, and the smooth transition of components from one stage of production to the next. In order for a company to come up with a plan that works well within their environment, they must first consider all the variables involved. They must have a plan that considers the way that each stage of the manufacturing process will affect the way each component of the process is used.
For instance, when a company manufactures food, they generally start by raising the temperature of the cooking process until they get the desired outcome. From there they incorporate mechanical chopping and blending until they have the end product they desire. Then, they can continue to feed components to the machinery until they arrive at the point where the product needs to be packaged. All of this takes place over several days. During this time, the product may be cooked slightly over a number of days, tested to ensure it meets all specifications, frozen, stored, transported, stored, and finally shipped to the customer.
The process is much the same for the supply chain. There are four stages involved in the entire production line, which is referred to as the pre-heat, pre-storage, post-heating, and post-packing. The company will need to think about how they can control each of these stages, but they must also keep in mind how each stage will impact the rest of the process. For example, during the pre-heating phase, the company will be able to control what type of heat they use on the various components so that they can achieve the best end result.
Once the pre-heating process is complete, the company can go back to the packing phase and work on the actual components. This is where the company will take their time to ensure each of the products are packaged properly to ensure that the product arrives on time and in good condition. By using supply chain technology, companies can not only control their entire production process, but they can also be sure that every product leaves the building on time and in good condition. They can develop a production model specifically for their product and then fine tune it for each specific product that they produce.
