Understanding total supply chain management and its building blocks

Cycle view The processes in a supply chain consist of a series of cycles, each performed at the interface between two successive stages. 

Push/pull view PuU processes are initiated by a customer order and push processes are initiated and performed on the forecast of customer orders. 

The demand cycle is the cycle of time covering from when a customer buys or orders from a retailer or wholesaler. The demand cycle can also be based on the forecast of demand. If the retailer holds the product in stock then the demand cycle will comprise of order request, order fulfilment and order receiving. However, if the product is not readily available then the customer order request wiU form a part of demand forecast which also includes predicted demand, market inteUigeuce and promotion of the product. 

The planning and procurement cycle covers short- and longer-term requirements. The demand of the product and its components (biU of materials) are compared with the inventory and capacity and the replenishment requiranents are planned. Planners will decide what to buy and what to make. This make or buy decision process also applies to a service organization leading to either in-house or outsourced services. 

The supply cycle typically occurs with a production schedule if the product is to be manufactured, or a purchase schedule if the product is to be procured from an external supplier. Once finished goods are manufactured or received the next stage of the supply cycle is direct delivery to customers or storage in the warehouse and subsequent distribution to customers. 

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Understanding total supply chain management and its building blocks... 

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