1.2 What Is ScM?1.2.1 Definition of SCM"sCM deals with the management of materials, information,and financial flows in a network consisting of suppliers,manufacturers, distributors, and customers."StanfordSupply Chain ForumSCM is a set of approaches utilized to efficiently integratesuppliers, manufacturers, warehouses, and stores, so thatmerchandise is produced and distributed at the rightquantities, to the right locations, and at the right time, inorder to minimize system-wide costs while satisfying(James Stock)servicelevelrequirements11
1.2 What Is SCM? 1.2.1 Definition of SCM “SCM deals with the management of materials, information, and financial flows in a network consisting of suppliers, manufacturers, distributors, and customers.“ Stanford Supply Chain Forum SCM is a set of approaches utilized to efficiently integrate suppliers, manufacturers, warehouses, and stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at the right time, in order to minimize system-wide costs while satisfying service level requirements. （James Stock） 11
DefinitionofSCMbyCSCMPSCMencompasses the planning and management of allactivities involved in sourcing and procurement, conversionand all Logistics Management activities. Importantly, italso includes coordination and collaboration withchannel partners, which can be suppliers, intermediariesthird-party service providers, and customers* In essence, SCM integrates supply and demandmanagement within and across companies. It includes all of thelogistics managementactivities and manufacturing operationsanditdrives coordination of processesandactivities acrossmarketing, sales, product design, finance, and informationtechnology.12
Definition of SCM by CSCMP: SCM encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all Logistics Management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In essence, SCM integrates supply and demand management within and across companies. It includes all of the logistics management activities and manufacturing operations, and it drives coordination of processes and activities across marketing, sales, product design, finance, and information technology. 12
1.2.2Activities in SCMCustomersManufacturersSuppliersDistributorsValue-Added chain (value flow)Funds/DemandFlowInformation Flow13
1.2.2 Activities in SCM 13 Information Flow Funds/Demand Flow Value-Added chain (value flow)
OutcomesorConsequencesof SupplyChainManagement* Improved customer value and satisfaction* Profitability (lower costs and/or increasedrevenues)* Differential advantage (potentiallysustainable)
Outcomes or Consequences of Supply Chain Management Improved customer value and satisfaction Profitability (lower costs and/or increased revenues) Differential advantage (potentially sustainable)