Making Money from the Supply Chain

What s new about supply chain management is the idea that it s a chain of multiple companies that deliver products and services, not chains of individual departments. To avoid one department reducing its own costs at the expense of another, it s particularly important that cost reduction be a crossfunctional initiative. 

This discipline also addresses the way numbers are collected, allocated, and reported. Therefore, Finance is likely to be an important contributor to 

Harbison, John R. and Pekar, Peter, Smart Alliances A Practical Guide to Repeat-able Success, San Francisco, Jossey-Bass, p. 128,1998. 

As quoted in Lean Directions, July 9, 2003, Society of Manufacturing Engineers. 

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Making money from the supply chain Pricing and cost always matter but ways of measuring and managing supply chain processes will change. Chapters 26-31... 

Often, the move away from the fxmctional viewpoint begins with efforts to lower the cost of materials. This viewpoint gave rise to the "supply" in "supply chain." In many product-making organizations today, the cost of material is the largest cost component. So, to quote a famous bank robber, management focuses its efforts "where the money is." When you talk of the supply chain, these companies think of suppliers and procurement. 

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