Supply Chain Management Concerns
Supply Chain Management Concerns
In the modern business world with an increase in technology and information-based consumers, it is no wonder why there are many issues that deal directly with supply chain management. The authors of Managerial Accounting for Managers define supply chain management as, “A management approach that coordinates business processes across companies to better serve end consumers,” (Noreen, Brewer and Garrison, 2011, p. 25). More and more consumers are increasingly trending toward a mass of buyers that crave instant gratification, whether it through technology, ...view middle of the document...
According to the research conducted by Supply Management, 68 percent of small and medium-sized enterprises want to increase their existing or nonexistent supply chain management departments, (Clark, 2011, p. 2). The author of Demand for Supply Chain Jobs 'on the rise' indicated that, “The government recently announced that it has provided funding to 32 local enterprise partnerships in a move that could boost procurement and supply chain jobs,” (Clark, 2011, p. 7).
Common Supply Chain Management Theories
There is a long list of theories and strategies that supply chain managers and corporate executives have implemented into their plans, but the authors of Managerial Accounting for Managers discuss two that work to uncover the problem and drive specific processes. The first theory is titled The Theory of Constraints, which the authors describe a constraint as anything that shows preventative qualities from you attaining a certain goal(s), (Noreen et al., 2011, p. 10). This can be anything from limited inventory, resources or simply the time allotted to perform a duty. The authors define this theory by stating that, “The Theory of Constraints is based on the insight that effectively managing the constraint is key to success,” (Noreen et al., 2011, p. 10). The process is simple and resembles something along the lines of process of elimination, which leads up to finding the root of the problem. The first step to the process is to determine the weakest link and deem this as the constraint, (Noreen et al., 2011, p. 11). The second step would be to not put any more effort or pressure on the constraint so as to not hinder the system any further, (Noreen et al., 2011, p. 11). The third step focuses on strengthening the constraint and looking for ways to either change or implement new practices in the system, (Noreen et al., 2011, p. 11). The fourth and final stage in The Theory of Constraints process if everything is successful thus far is to identify the new constraint and shift efforts over to the newly-discovered weakest link, (Noreen et al., 2011, p. 11).
The other theory that is discussed by the authors of Managerial Accounting for Managers is called Six Sigma. The authors state this theory to be, “A process involvement method that relies on customer feedback and fact-based data gathering and analysis techniques to drive process improvement,” (Noreen et al., 2011, p. 11). This process is generally referred to as a process that includes little to no defects based off the results. The first stage is to define or establish the scale and the goals of the project, (Noreen et al., 2011, p. 11). The next stage is to measure and, “Gather baseline performance data related to the existing process,” (Noreen et al., 2011, p. 11). Next, the project calls for an analysis where the source of the problem from the measure stage can be determined, (Noreen et al., 2011, p. 11). The fourth stage is titled ‘improve’ and is designed to assess and create solutions...