Monday, September 29, 2008

Developments in Supply Chain Management

Developments in Supply Chain Management

Six major movements can be observed in the evolution of supply chain management studies: Creation, Integration, and Globalization (Lavassani et al., 2008a), Specialization Phases One and Two, and SCM 2.0.

1. Creation Era

The term supply chain management was first coined by an American industry consultant in the early 1980s. However the concept of supply chain in management, was of great importance long before in the early 20th century, especially by the creation of the assembly line. The characteristics of this era of supply chain management include the need for large scale changes, reengineering, downsizing driven by cost reduction programs, and widespread attention to the Japanese practice of management.

2. Integration Era

This era of supply chain management studies was highlighted with the development of Electronic Data Interchange (EDI) systems in the 1960s and developed through the 1990s by the introduction of Enterprise Resource Planning (ERP) systems. This era has continued to develop into the 21st century with the expansion of internet-based collaborative systems. This era of SC evolution is characterized by both increasing value-added and cost reduction through integration.

3. Globalization Era

The third movement of supply chain management development, globalization era, can be characterized by the attention towards global systems of supplier relations and the expansion of supply chain over national boundaries and into other continents. Although the use of global sources in the supply chain of organizations can be traced back to several decades ago (e.g. the oil industry), it was not until the late 1980s that a considerable number of organizations started to integrate global sources into their core business. This era is characterized by the globalization of supply chain management in organizations with the goal of increasing competitive advantage, creating more value-added, and reducing costs through global sourcing.

4. Specialization Era -- Phase One -- Outsourced Manufacturing and Distribution

In the 1990s industries began to focus on “core competencies” and adopted a specialization model. Companies abandoned vertical integration, sold off non-core operations, and outsourced those functions to other companies. This changed management requirements by extending the supply chain well beyond the four walls and distributing management across specialized supply chain partnerships.

This transition also refocused the fundamental perspectives of each respective organization. OEMs became brand owners that needed deep visibility into their supply base. They had to control the entire supply chain from above instead of from within. Contract manufacturers had to manage bills of material with different part numbering schemes from multiple OEMs and support customer requests for work -in-process visibility and vendor-managed inventory (VMI).

The specialization model creates manufacturing and distribution networks composed of multiple, individual supply chains specific to products, suppliers, and customers who work together to design, manufacture, distribute, market, sell, and service a product. The set of partners may change according to a given market, region, or channel, resulting in a proliferation of trading partner environments, each with its own unique characteristics and demands.

5. Specialization Era -- Phase Two -- Supply Chain Management as a Service

Specialization within the supply chain began in the 1980s with the inception of transportation brokerages, warehouse management, and non asset based carriers and has matured beyond transportation and logistics into aspects of supply planning, collaboration, execution and performance management.

At any given moment, market forces could demand changes within suppliers, logistics providers, locations, customers and any number of these specialized participants within supply chain networks. This variability has significant effect on the supply chain infrastructure, from the foundation layers of establishing and managing the electronic communication between the trading partners to the more-complex requirements, including the configuration of the processes and work flows that are essential to the management of the network itself.

Supply chain specialization enables companies to improve their overall competencies in the same way that outsourced manufacturing and distribution has done; it allows them to focus on their core competencies and assemble networks of best in class domain specific partners to contribute to the overall value chain itself – thus increasing overall performance and efficiency. The ability to quickly obtain and deploy this domain specific supply chain expertise without developing and maintaining an entirely unique and complex competency in house is the leading reason why supply chain specialization is gaining popularity.

Outsourced technology hosting for supply chain solutions debuted in the late 1990s and has taken root in transportation and collaboration categories most dominantly. This has progressed from the Application Service Provider (ASP) model from approximately 1998 through 2003 to the On-Demand model from approximately 2003-2006 to the Software as a Service (SaaS) model we are currently focused on today.

6. Supply Chain Management 2.0 (SCM 2.0)

Building off of globalization and specialization, SCM 2.0 has been coined to describe both the changes within the supply chain itself as well as the evolution of the processes, methods and tools that manage it in this new "era".

Web 2.0 is defined as a trend in the use of the World Wide Web that is meant to increase creativity, information sharing, and collaboration among users. At its core, the common attribute that Web 2.0 brings is it helps us navigate the vast amount of information available on the web to find what we are looking for. It is the notion of a usable pathway. SCM 2.0 follows this notion into supply chain operations. It is the pathway to SCM results – the combination of the processes, methodologies, tools and delivery options to guide companies to their results quickly as the complexity and speed of the supply chain increase due to the effects of global competition, rapid price commoditization, surging oil prices, short product life cycles, expanded specialization, near/far and off shoring, and talent scarcity.

SCM 2.0 leverages proven solutions designed to rapidly deliver results with the agility to quickly manage future change for continuous flexibility, value and success. This is delivered through competency networks composed of best of breed supply chain domain expertise to understand which elements, both operationally and organizationally, are the critical few that deliver the results as well as the intimate understanding of how to manage these elements to achieve desired results, finally the solutions are delivered in a variety of options as no-touch via business process outsourcing, mid-touch via managed services and software as a service (SaaS), or high touch in the traditional software deployment model.

Supply chain business process integration

Supply chain business process integration

Successful SCM requires a change from managing individual functions to integrating activities into key supply chain processes. An example scenario: the purchasing department places orders as requirements become appropriate. Marketing, responding to customer demand, communicates with several distributors and retailers as it attempts to satisfy this demand. Shared information between supply chain partners can only be fully leveraged through process integration.

Supply chain business process integration involves collaborative work between buyers and suppliers, joint product development, common systems and shared information. According to Lambert and Cooper (2000) operating an integrated supply chain requires continuous information flow. However, in many companies, management has reached the conclusion that optimizing the product flows cannot be accomplished without implementing a process approach to the business. The key supply chain processes stated by Lambert (2004) [5] are:

  • Customer relationship management
  • Customer service management
  • Demand management
  • Order fulfillment
  • Manufacturing flow management
  • Supplier relationship management
  • Product development and commercialization
  • Returns management

One could suggest other key critical supply business processes combining these processes stated by Lambert such as:

  1. Customer service management
  2. Procurement
  3. Product development and commercialization
  4. Manufacturing flow management/support
  5. Physical distribution
  6. Outsourcing/partnerships
  7. Performance measurement
a) Customer service management process

Customer Relationship Management concerns the relationship between the organization and its customers. Customer service provides the source of customer information. It also provides the customer with real-time information on promising dates and product availability through interfaces with the company's production and distribution operations. Successful organizations use following steps to build customer relationships:

  • determine mutually satisfying goals between organization and customers
  • establish and maintain customer rapport
  • produce positive feelings in the organization and the customers
b) Procurement process

Strategic plans are developed with suppliers to support the manufacturing flow management process and development of new products. In firms where operations extend globally, sourcing should be managed on a global basis. The desired outcome is a win-win relationship, where both parties benefit, and reduction times in the design cycle and product development are achieved. Also, the purchasing function develops rapid communication systems, such as electronic data interchange (EDI) and Internet linkages to transfer possible requirements more rapidly. Activities related to obtaining products and materials from outside suppliers requires performing resource planning, supply sourcing, negotiation, order placement, inbound transportation, storage, handling and quality assurance, many of which include the responsibility to coordinate with suppliers in scheduling, supply continuity, hedging, and research into new sources or programmes.

c) Product development and commercialization

Here, customers and suppliers must be united into the product development process, thus to reduce time to market. As product life cycles shorten, the appropriate products must be developed and successfully launched in ever shorter time-schedules to remain competitive. According to Lambert and Cooper (2000), managers of the product development and commercialization process must:

  1. coordinate with customer relationship management to identify customer-articulated needs;
  2. select materials and suppliers in conjunction with procurement, and
  3. develop production technology in manufacturing flow to manufacture and integrate into the best supply chain flow for the product/market combination.
d) Manufacturing flow management process

The manufacturing process is produced and supplies products to the distribution channels based on past forecasts. Manufacturing processes must be flexible to respond to market changes, and must accommodate mass customization. Orders are processes operating on a just-in-time (JIT) basis in minimum lot sizes. Also, changes in the manufacturing flow process lead to shorter cycle times, meaning improved responsiveness and efficiency of demand to customers. Activities related to planning, scheduling and supporting manufacturing operations, such as work-in-process storage, handling, transportation, and time phasing of components, inventory at manufacturing sites and maximum flexibility in the coordination of geographic and final assemblies postponement of physical distribution operations.

e) Physical distribution

This concerns movement of a finished product/service to customers. In physical distribution, the customer is the final destination of a marketing channel, and the availability of the product/service is a vital part of each channel participant's marketing effort. It is also through the physical distribution process that the time and space of customer service become an integral part of marketing, thus it links a marketing channel with its customers (e.g. links manufacturers, wholesalers, retailers).

f) Outsourcing/partnerships

This is not just outsourcing the procurement of materials and components, but also outsourcing of services that traditionally have been provided in-house. The logic of this trend is that the company will increasingly focus on those activities in the value chain where it has a distinctive advantage and everything else it will outsource. This movement has been particularly evident in logistics where the provision of transport, warehousing and inventory control is increasingly subcontracted to specialists or logistics partners. Also, to manage and control this network of partners and suppliers requires a blend of both central and local involvement. Hence, strategic decisions need to be taken centrally with the monitoring and control of supplier performance and day-to-day liaison with logistics partners being best managed at a local level.

g) Performance measurement

Experts found a strong relationship from the largest arcs of supplier and customer integration to market share and profitability. By taking advantage of supplier capabilities and emphasizing a long-term supply chain perspective in customer relationships can be both correlated with firm performance. As logistics competency becomes a more critical factor in creating and maintaining competitive advantage, logistics measurement becomes increasingly important because the difference between profitable and unprofitable operations becomes more narrow. A.T. Kearney Consultants (1985) noted that firms engaging in comprehensive performance measurement realized improvements in overall productivity. According to experts internal measures are generally collected and analyzed by the firm including

  1. Cost
  2. Customer Service
  3. Productivity measures
  4. Asset measurement, and
  5. Quality.

External performance measurement is examined through customer perception measures and "best practice" benchmarking, and includes 1) customer perception measurement, and 2) best practice benchmarking. Components of Supply Chain Management are 1. Standardization 2. Postponement 3. Customization

Supply chain management

Supply chain management

Organizations increasingly find that they must rely on effective supply chains, or networks, to successfully compete in the global market and networked economy.[2] In Peter Drucker's (1998) management's new paradigms, this concept of business relationships extends beyond traditional enterprise boundaries and seeks to organize entire business processes throughout a value chain of multiple companies.

During the past decades, globalization, outsourcing and information technology have enabled many organizations, such as Dell and Hewlett Packard, to successfully operate solid collaborative supply networks in which each specialized business partner focuses on only a few key strategic activities (Scott, 1993). This inter-organizational supply network can be acknowledged as a new form of organization. However, with the complicated interactions among the players, the network structure fits neither "market" nor "hierarchy" categories (Powell, 1990). It is not clear what kind of performance impacts that different supply network structures could have on firms, and little is known about the coordination conditions and trade-offs that may exist among the players. From a system's point of view, a complex network structure can be decomposed into individual component firms (Zhang and Dilts, 2004). Traditionally, companies in a supply network concentrate on the inputs and outputs of the processes, with little concern for the internal management working of other individual players. Therefore, the choice of an internal management control structure is known to impact local firm performance (Mintzberg, 1979).

In the 21st century, there have been a few changes in business environment that have contributed to the development of supply chain networks. First, as an outcome of globalization and the proliferation of multi-national companies, joint ventures, strategic alliances and business partnerships, there were found to be significant success factors, following the earlier "Just-In-Time", "Lean Management" and "Agile Manufacturing" practices.[3] Second, technological changes, particularly the dramatic fall in information communication costs, which are a paramount component of transaction costs, have led to changes in coordination among the members of the supply chain network (Coase, 1998).

Many researchers have recognized these kinds of supply network structures as a new organization form, using terms such as "Keiretsu", "Extended Enterprise", "Virtual Corporation", "Global Production Network", and "Next Generation Manufacturing System".[4] In general, such a structure can be defined as "a group of semi-independent organizations, each with their capabilities, which collaborate in ever-changing constellations to serve one or more markets in order to achieve some business goal specific to that collaboration" (Akkermans, 2001).

Logistics Management

Logistics Management is that part of Supply Chain Management that plans, implements, and controls the efficient, effective, forward, and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption in order to meet customers’ requirements.

Business logistics

Business logistics

Logistics as a business concept evolved only in the 1950s. This was mainly due to the increasing complexity of supplying one's business with materials and shipping out products in an increasingly globalized supply chain, calling for experts in the field who are called Supply Chain Logisticians. This can be defined as having the right item in the right quantity at the right time at the right place for the right price and is the science of process and incorporates all industry sectors. The goal of logistics work is to manage the fruition of project life cycles, supply chains and resultant efficiencies.

In business, logistics may have either internal focus (inbound logistics), or external focus (outbound logistics) covering the flow and storage of materials from point of origin to point of consumption (see supply chain management). The main functions of a qualified logistician include inventory management, purchasing, transportation, warehousing, consultation and the organizing and planning of these activities. Logisticians combine a professional knowledge of each of these functions so that there is a coordination of resources in an organization. There are two fundamentally different forms of logistics. One optimizes a steady flow of material through a network of transport links and storage nodes. The other coordinates a sequence of resources to carry out some project.

Job Profiles

Job Profiles

Supply chain management offers a wide variety of job options for entry-level managers and beyond. Your opportunities are only limited by the geographic scope of your search, the industries that you are willing to pursue, and the types of positions that you will consider. To help you understand the assortment of supply chain careers, profiles have been developed for ten different SCM positions.

Many of the positions profiled in the Careers website focus on jobs entry-level management positions. You may jump into these positions immediately or after completion of a management training program or a short stint in a learning role. A few of the positions are more advanced and require significant SCM experience. Those descriptions will help you understand future opportunities that exist for you in the future.

Check back periodically as new job profiles will be added to the website.

Job Profiles (minimum experience level)

First Level Management (0-4 years)

Consultant
Customer Service Manager
Fulfillment Supervisor
Supply Chain Analyst

Middle Level Management (5-10 years)

International Logistics Manager
Purchasing Manager
Supply Chain Software Manager

Transportation Manager
Warehouse Operations Manager

Executive Level Management (11+ years)

Vice President of SCM

Continuing Education

Continuing Education

What do you, Tiger Woods, Sidney Crosby, and LeBron James have in common? It's probably not the level of fame or fortune. No, the real link between you and them is the critical need to continually sharpen skills and knowledge in your chosen profession. Superstars don't sit around talking about their previous championships. They focus on achieving future success via hard work, regular practice, and attention to detail.

The same will be true for your supply chain career. Getting a college degree is a great accomplishment and a key to getting that first SCM job but it won't guarantee future success. You'll need to make a concerted effort to gain supply chain knowledge through your day-to-day responsibilities. It would also be smart to supplement your expertise by taking formal training courses, reading professional publications, and participating in professional meetings.

Fortunately, there are many resources to help you sharpen your supply chain skills. Online courses and webinars provide easy access to knowledge leaders. Professional organizations facilitate interaction with your peers. Certification programs are another option. Finally, don’t forget your alma mater. Many universities conduct cutting-edge supply chain seminars (and alumni often get a discounted rate).

Here are a few links that highlight the wide variety of continuing education options available to supply chain professionals:

CSCMP Online University

CSCMP On-Site Education

CSCMP Roundtable Events

IDII Supply Chain Events Newsletter

World Wide Learn

Why You Should Get Involved!

Why You Should Get Involved!

Many students join SCM -focused student organizations on campus but think that professional organizations are reserved for industry executives. Nothing could be further from the truth! There's much to gain from membership and supply chain professional organizations actively encourage students to join. Sure, it looks great on your resume but there are far more valuable reasons for getting actively involved now rather than later:

  • Job hunting resources. When it's time to start the job search process, you'll have valuable resources available through the professional organization's website. They provide job listings, resume posting services, salary information, and other career tools.
  • Networking, networking, networking! SCM organizations hold dinner meetings, conferences, and other events where you can interact with supply chain thought leaders. The organization's membership directory will also provide contact information for supply chain professionals in your area.
  • Information access . Need to learn about supply chain trends and issues for an interview, presentation, or paper? Professional organizations give you first-hand access to great resources on the current state of SCM and help you build useful knowledge.
  • Reduced membership fees! SCM professional organization leaders realize that students don't have money to burn. In response, they offer major discounts on membership fees to full-time students. Spend a few bucks to join now instead of hundreds later!

Still not convinced? Click here for a full list of CSCMP student membership benefits.

Salary Wizard

Salary Wizard

Here is a great resource to find the most up-to-date information on salaries within supply chain and logistics. It is Salary.com You can run a search on supply chain/logistics jobs searching by job title, or job title and zip code to see what the salary range is in a particular area. Need a list of suggested titles to search? Check our Career job profiles or Career job descriptions page for ideas.

We welcome your feedback! Contact us and let us know if you found this tool helpful.

Salary Considerations

Salary Considerations

What Factors Impact Salaries?

Although there's no perfect formula for estimating the offers that you will receive, the following issues impact an employer's starting salary offers:

Factor

What Drives Salary Offers Higher?

Education Level

Advanced degree such as an MBA produce higher salary offers than do Bachelor or Associate degrees.

Relevant Work Experience

Extensive supply chain work experience (even as an hourly associate) or participation in SCM internships gives you a strong foundation and the ability to command more money.

Grades and Accomplishments

Some companies pay a premium for students with high GPAs and related academic accomplishments.

Leadership Experience

SCM is a people business. If you have a demonstrated ability to effectively lead people, your stock will rise.

Scope of Responsibilities

The greater the responsibility (e.g., managing more people or controlling a larger budget), the higher the salary!

Company Type

Historically, the highest SCM salary offers have come from the manufacturing sector. However, retailers, carriers, and 3PL firms are working to close the gap.

Geographic Flexibility

Being open to relocation early in your work life will positively impact your career options and salary growth.

Geographic Location

Jobs in larger cities and geographic areas (Northeast and West) with a higher cost of living pay more to offset your added expenses.

Ability to Negotiate

Many SCM positions are pegged to a starting salary range rather than a single number. Your ability to sell your skills, motivation, and potential for success will determine what you are offered within that range.

Don’t Forget the Benefits

In addition, SCM positions typically offer a full range of benefits and you are likely to be eligible for bonus pay. The article Benefits and Bonuses provides an excellent discussion of the wide array of perks that employers offer to new hires. Although it specifically addresses another service industry, the themes are on target for SCM grads. The author wisely suggests: “you need to understand what benefits employers will dangle under your nose, which employers offer the best deals and how to bargain your way to a more inviting work environment.”

Salary Outlook

Salary Outlook

Photo of piggy bank and money bagsExcellent employment prospects, a fast-paced, fulfilling work environment, and the opportunity for career growth all sound great, but you’re still thinking “show me the money.” Fear not, you’ve found the SCM salary data page and you’ll really like what you see! Starting SCM salaries for 2007 college graduates in the logistics/materials management curriculum average $45,771 according to the National Association of Colleges and Employers. These salaries are very competitive with other business school disciplines.

Compensation by Position Type

The table below provides insight into the pay prospects for just nine of the many SCM positions available to college graduates. The data reflects total cash compensation (base salary plus incentive pay) reported for each position in the 2007 Mercer Benchmark Database for Logistics and Supply Chain Positions. Mercer LLC is a human resources-focused global consulting firm.

Mouse over Position Type/Title for detailed descriptions.

Salary Graph

As the mid-level and executive level compensation data suggests, the SCM profession offers excellent upside salary potential. As you gain experience and show what you can accomplish, your pay will grow. According to the Logistics Management Magazine 23rd Annual Salary Survey results, the typical respondent (44 year old, college educated manager with 15.7 years of experience) earns $80,000 per year. The study concludes: "As companies continue to outsource and seek productivity and cost improvements, the demand for quality people-and subsequently for solid salaries-is likely to increase in the coming years." Click here for additional salary data.

About the Mercer Benchmarking Survey
The 2007 Mercer Benchmark Database – Logistics and Supply Chain Positions provides information reported by 1,338 US organizations. Conducted annually by Mercer, it includes compensation data for 62 positions, ranging from top management to clerical, across industries.

Career Paths

Career Paths

There is no standard career path in SCM. You are in control of your own destiny and have the opportunity to pursue hundreds of potential career paths. Your career path will be largely influenced by your skills, interests, and personal decisions. It will also be impacted by the size, type, geographic scope, and organizational structure of the firm that you choose to work for.

A broad base of business skills, knowledge of supply chain processes, and relevant internship/work experience will give you ample opportunity to begin your career with a manufacturer, retailer, carrier, third party logistics firm, or other organization. You will likely begin as a management trainee, analyst, or front line supervisor. As you demonstrate your managerial capabilities, you can progress to SCM positions of greater responsibility. You may also decide to gain experience in other parts of the organization.

One key to your success in this field is flexibility. You will work with people throughout your company—logistics, manufacturing, and marketing. Depending on the size of your company, your initial responsibilities may deal with one or more logistics functions. Some positions will require you to specialize in a specific area of SCM. There are numerous opportunities and career paths in this field—it is up to you to seek them out and develop the appropriate skills to be successful.

Career Profiles

Supply chain careers offer many routes to success. As discussed earlier, your career can take you to many types of organizations, numerous supply chain activities, and virtually any location in the U.S. or the world depending on your skills and interests.

The career path profiles provide great examples of how senior supply chain leaders work their way to the top of the organization. Realize that success is not an overnight proposition. These supply chain professionals invest a great deal of time and effort into their careers, take on challenging roles, and make sacrifices along the way. They have truly earned their prestigious positions.

r4 65 sd
Greg Swoyer
Director, CS/Logistics
Yannis Skoufalos
VP, Product Supply
Robert L. Robertson
Director, Supply

Supply Chain Video Resources

Supply Chain Video Resources

"Careers in Logistics: Put Your Future in Motion"

Check out this six minute video produced by the Calgary Board of Education.

Site location: http://www.careersinlogistics.ca/

Prof. Hau Lee, Standford University

Supply-Chain Guru Brings Expertise to IESE Barcelona

Noted Supply-Chain academic, Prof. Hau Lee of Stanford University, speaks at IESE about how executives can strategically position themselves at the right level of the value net.

Career DVD

Career DVD

df“What in the World is the Global Supply Chain?”

In an effort to help people better understand SCM, the Council of Supply Chain Management Professionals has produced a 40 minute DVD. What in the World is the Global Supply Chain presents the insights of leading SCM professionals, as well as…

Click the icons to view individual segments of the Global Supply Chain DVD.

asd DVD trailer - provides an overview of SCM with excellent commentary and video of the supply chain in action.
Running time: 3 minutes. [Media Player]
asd

What is Supply Chain? - provides a brief explanation on the supply chain.
Running time: 1 minute 50 seconds.
flv [Flash Movie]
wmv [Media Player]
mov [QuickTime]

asd Supply Chain Cycle - provides an explanation of how the supply chain cycle works.
Running time: 1 minute 50 seconds.
flv [Flash Movie]
wmv [Media Player]
mov [QuickTime]

SCM Resources

SCM Resources

The Careers in Supply Chain Management is a great starting place to learn about the industry, career opportunities, and education options. There are many other websites and resources that supplement this site with additional information about SCM . With a few mouse clicks, you'll have access to a wealth of free supply chain knowledge from leading supply chain publications, government agencies, and national organizations like CSCMP that are dedicated to serving the supply chain profession. Also, SCM portals like the Supply Chain Brain website give you insight into SCM news, events, and tons of URLs for relevant websites.


Industry Groups

Supply Chain Council
www.supply-chain.org

Supply Chain & Logistics Council of Canada
www.sclcanada.org

NASSTRAC
www.nasstrac.org

International Warehouse Logistics Association
www.iwla.com

SCM Publications

CSCMP Supply Chain Quarterly
cscmp.org

Supply Chain Management Review
www.scmr.com

Achieving SC Excellence Through Technology
www.ascet.com

Supply & Demand Chain Executive
www.sdcexec.com

Government Agencies

Department of Transportation
www.dot.gov

Bureau of Transportaiton Statistics
www.bts.gov

Customs & Border Patrol
www.customs.gov

Defense Logistics Agency
www.dla.mil

General Resources

About:Logistics & SCM
logistics.about.com

Freightworld
www.freightworld.com

WWW Virtual Library: Logistics
www.logisticsworld.com

Supply Ghain Standard (Europe)
supplychainstandard.com


If this resource list doesn't lead to the information you need, just Google the phrase “Supply Chain Management.” You'll have more than 2.2 million web links to check out!

SCM Glossary

SCM Glossary

Supply chain management has a language of its own and numerous acronyms that are used in the industry. In fact, there are thousands of terms specific to managing supply chain processes. These terms are generally explained in supply chain textbooks, but you can also access online supply chain tools that discuss the meaning of logistics and supply chain terms. For example, CSCMP has a downloadable glossary of supply chain and logistics terms that you can print or save to your hard drive for future use.

See the CSCMP Glossary of Terms to view this document (.pdf format).

The following resources can help you make sense of supply chain lingo:

SCM Glossaries

Supply Chain Acronyms

Logistics Glossaries

Transportation Glossaries

Global Logistics Glossaries

Frequently Asked Questions

Frequently Asked Questions

The Careers website provides a brief overview of supply chain management, career information, and resources for you to use. Still, you may find some of the issues and topics to be a bit sketchy. We've developed a list of frequently asked questions (FAQs) and answers to address lingering doubts or confusion. If you don't see your question addressed here, feel free to ask a question. There's a form provided at the bottom of the page.

Contract All | Expand All

What is supply chain management?
What is a supply chain?
What is logistics?
Why is supply chain management important?
What challenges do companies face as they try to improve SCM?
What kinds of jobs (and salaries) are available for SCM graduates?
Is there a typical career path in SCM?
What skills do I need to build in preparation for a supply chain career?
Where can I study SCM?
What types of classes are offered in SCM?
Is an internship important?

Ask any additional questions you want an answer to at cscmpcareers@cscmp.org

Job Descripitons

Job Descripitons

There are many lucrative supply chain management positions available in this industry. No one position is alike. To help you gain better understanding of the requirements for supply chain positions, there are actual job descriptions that have been recently posted by U.S. companies provided below.

Be sure to check back periodically as new job descriptions will be added to the website.


Demand Planner
Project Manager
Vendor Managed Inventory (VMI) Analyst
Senior Consultant

Middle Level Management (5-10 years)


Master Production Scheduler
Sourcing Manager
Director of Operations
Director of Transportation

Executive Level Management (11+ years)


Vice President of Global Logistics


Role of Supply Chain Managers

Role of Supply Chain Managers

Supply chain managers have a tremendous impact on the success of an organization. These managers are engaged in every facet of the business process – planning, purchasing, production, transportation, storage & distribution, customer service, and more! In short, these managers are the “glue” that connects the different parts of the organization. Their performance helps organizations control expenses, boost sales, and maximize profits.

Two additional roles focus on facilitation and collaboration. Because supply chain managers touch so many different parts of the business, they are in a unique position to help other functions execute their strategies. They are also called upon to diagnose and support the needs of external supply chain partners. Here are just a few examples of these cross-functional roles:

  • Effective selection and management of suppliers support lean manufacturing processes.
  • Efficient transportation & distribution practices bolster marketing campaigns.
  • Timely customer communication and technology-enabled visibility allows companies to monitor product flows and collaboratively respond to potential delivery problems.

Variety of Roles = Multiple Opportunities

What can all these different roles mean to you? Each role presents a different type of SCM career starting point for new college grads. Whether you prefer to work with a team of people to achieve tangible results, develop processes to improve performance, or apply technology to analyze data, there is a supply chain opportunity waiting for you! You will find these careers in a wide variety of organizations – manufacturers, retailers, transportation companies, third party logistics firms, government agencies, and service firms. The array of companies needing supply chain expertise is nearly endless.

You should also realize that the nature of supply chain jobs varies greatly. At one end of the spectrum are operations-focused positions. These action-oriented roles involve the day-to-day management of people and product flows. You would likely be working in a distribution facility, port, terminal, or operations center. At the other end of the spectrum are planning-oriented positions. These office-based positions focus on supply management, demand forecasting, inventory control, performance analysis, or troubleshooting customer problems.

Regardless of your personality type, work style, or desired working location, there’s a supply chain career path for you. Check out the different job profiles that are provided in this section of the Careers website to figure out what piques your interests. Then, make an effort to learn more about the opportunities and educational requirements in that area of the supply chain.

Where to Find Jobs – Potential Employers

Where to Find Jobs – Potential Employers

If you think about it, nearly every organization is involved in purchasing goods, controlling inventory, building products, moving freight, and/or managing relationships. These fundamental activities translate into many different supply chain employment opportunities with a vast number of potential employers. When searching for jobs, it's best to be flexible in terms of geographic location, industry, and company type. You may find tremendous career opportunities with a company that you never would have otherwise considered!

Mouse over the different types of organizations in the graphic to learn more about potential employers.

Employment Opportunities

Employment Opportunities

There is plenty of good news regarding employment in the fascinating and diverse field of supply chain management (SCM). It’s a huge field with tremendous opportunities for talented and energetic future managers like you.

How big is SCM? Logistics alone accounts for more than 9.5% of U.S. Gross Domestic Product! Over $1.3 trillion is spent on transportation, inventory, and related logistics activities. Add in the vast sums of money spent on supply management and manufacturing and you’re looking at a field with tremendous impact on the success of organizations, domestically and globally.

With supply chain spending growing faster than the overall economy and company executives recognizing the importance of SCM, an attractive job market exists. Eileen Coparropa, a 2005 SCM graduate recently summed up the job market by saying “When I graduated with my SCM degree, I had good job offers from several third-party logistics providers and shippers. Since going to work for T-Mobile, I have traveled for special project assignments, had the opportunity to manage people, and have recently served as a supply chain analyst.”

You will find SCM career opportunities in a variety of organizations. Potential employers range from traditional manufacturers and retailers to supply chain specialists like consulting firms and transportation service providers. Another SCM employment option is the $110 billion third party logistics (3PL) industry (http://www.3plogistics.com/3PLmarket.htm). “Working for a 3PL gives me extensive growth opportunities and broad exposure to various companies and facilities,” notes Exel manager Robert Karschner.

Finally, SCM positions are never boring and allow you to perform an extensive range of duties. “The thing I love most about my job is that no two days are the same. Every hour seems to bring about new challenges” says Scott Pixler, a recent graduate and current Eagle Global Logistics account manager. “Working in SCM has surpassed my expectations. I’ve been exposed to a wide variety of experiences and had great training opportunities.”

Seven Principles of SCM

Seven Principles of SCM

More than ten years ago, a research study of 100+ manufacturers, distributors, and retailers uncovered some widely used supply chain strategies and initiatives. These ideas and practices were distilled down to seven principles and presented in an article in Supply Chain Management Review, a magazine widely read by SCM professionals.

Though they are more than a decade old, these timeless principles highlight the need for supply chain leaders to focus on the customer. They also stress the importance of coordinating activities (demand planning, sourcing, assembly, delivery, and information sharing) within and across organizations.

Here's an excerpt from the article:

“Managers increasingly find themselves assigned the role of the rope in a very real tug of war—pulled one way by customers' mounting demands and the opposite way by the company's need for growth and profitability. Many have discovered that they can keep the rope from snapping and, in fact, achieve profitable growth by treating supply chain management as a strategic variable.

These savvy managers recognize two important things:

  • They think about the supply chain as a whole—all the links involved in managing the flow of products, services, and information from their suppliers' suppliers to their customers' customers (that is, channel customers, such as distributors and retailers).
  • They pursue tangible outcomes—focused on revenue growth, asset utilization, and cost.”

Source: David L. Anderson, Frank F. Britt, and Donavon J. Favre, “The Seven Principles of Supply Chain Management, Supply Chain Management Review, (1997).

SCM Processes

SCM Processes

Supply chain activities aren't the responsibility of one person or one company. Multiple people need to be actively involved in a number of different processes to make it work.

It's kind of like baseball. While all the participants are called baseball players, they don't do whatever they want. Each person has a role – pitcher, catcher, shortstop, etc. – and must perform well at their assigned duties – fielding, throwing, and/or hitting – for the team to be successful.

Of course, these players need to work well together. A hit-and-run play will only be successful if the base runner gets the signal and takes off running, while the batter makes solid contact with the ball. The team also needs a manager to develop a game plan, put people in the right positions, and monitor success.

Winning the SCM “game” requires supply chain professionals to play similar roles. Each supply chain player must understand his or her role, develop winning strategies, and collaborate with their supply chain teammates. By doing so, the SCM team can flawlessly execute the following processes:

  • Planning – the plan process seeks to create effective long- and short-range supply chain strategies. From the design of the supply chain network to the prediction of customer demand, supply chain leaders need to develop integrated supply chain strategies.
  • Procurement – the buy process focuses on the purchase of required raw materials, components, and goods. As a consumer, you're pretty familiar with buying stuff!
  • Production – the make process involves the manufacture, conversion, or assembly of materials into finished goods or parts for other products. Supply chain managers provide production support and ensure that key materials are available when needed.
  • Distribution – the move process manages the logistical flow of goods across the supply chain. Transportation companies, third party logistics firms, and others ensure that goods are flowing quickly and safely toward the point of demand.
  • Customer Interface – the demand process revolves around all the issues that are related to planning customer interactions, satisfying their needs, and fulfilling orders perfectly.

SCM Flows

SCM Flows

If the goal of SCM is to provide high product availability through efficient and timely fulfillment of customer demand, then how is the goal accomplished?

Obviously, you need effective flows of products from the point of origin to the point of consumption. But there’s more to it. Consider the diagram of the fresh food supply chain. A two-way flow of information and data between the supply chain participants creates visibility of demand and fast detection of problems. Both are needed by supply chain managers to make good decisions regarding what to buy, make, and move.

Other flows are also important. In their roles as suppliers, companies have a vested interest in financial flows. As you can understand, suppliers want to get paid for their products and services as soon as possible and with minimal hassle. Sometimes, it is also necessary to move products back through the supply chain for returns, repairs, recycling, or disposal.

Take another look at the diagram. Do you see all the processes that have to take place at the different types of participating companies? What should this signal to you? That’s right - opportunity! Each company needs supply chain managers to help improve their flows of product, information, and money. Not only does SCM offer a wide variety of career options, these excellent paying positions will boost the amount of money flowing into your wallet!

SCM Goals – The Seven Rights

SCM Goals – The Seven Rights

The ability to meet customer requirements, for everything from coffee beans to Crocs, is built upon the expectation that everything is done correctly in the supply chain. And that means doing it right the first time – no mulligans, no mistakes are allowed. In the quest to provide quality service and satisfy customers, world-class companies along the supply chain are guided by the Seven Rights of Fulfillment.

If you think about it, every order needs to be executed according to these seven goals. You must attempt to deliver a “perfect order” to every customer every time. Doing it right the first time makes the customer happy, saves the cost of fixing errors, and doesn't require extra use of assets. Thus, every part of the organization has a vested interest in pursuing perfection.

So, what exactly is a “perfect order” delivery? Think about your most recent online purchase. If all Seven Rights of Fulfillment were achieved, then you received a perfect order. What did your perfect order fulfillment entail? The seller had your preferred product available for order, processed your order correctly, shipped the entire order via the means that you requested, provided you with an advanced shipping notification and tracking number, delivered the complete order on time and without damage, and billed you correctly. You're happy, they've done their job right, and you have good reason to visit their website in the future!

SCM Concepts

SCM Concepts

Coffee Beans

Shortly after your alarm clock goes off and the coffee maker kicks on, the fleeting, floral aroma of that smooth Sidamo coffee fills the air. Getting those coffee beans from a small garden in Ethiopia to your kitchen is no small feat. It took a great deal of planning, demand forecasting, procurement, and logistical expertise to move those savory beans from Africa to your local java shop while still fresh. Without a strong supply chain in place, your caffeine-fix options would be severely limited.

SCM involves a series of key activities and processes that must be completed in an efficient (fuel conserving, cost reducing, etc.) and timely manner. Otherwise, product will not be available when needed by consumers like you. Click on each graphic to gain more insight into key supply chain goals, flows, processes, and principles.

SCM Goals: The 7 Rights]





Supply Chain Flows




The 7 Principles of SCM



Supply Chain Processes