Supply Chain Management

Business, Legal & Accounting Glossary

Definition: Supply Chain Management

Full Definition of Supply Chain Management

Supply Chain Management(SCM) deals with the planning and execution issues involved in managing a supply chain.

The components of SCM are:

  • Demand Planning: (forecasting)
  • Demand Collaboration: (collaborative resolution process to determine consensus forecasts)
  • Order Promising: (When can one promise a product to a customer taking account lead times and constraints)
  • Strategic Network Optimization: (what plants and DC’s should serve what markets for what products) (monthly – yearly)
  • Production and Distribution Planning: (Coordinate the actual production and distribution plans for a whole enterprise) (daily)
  • Production Scheduling: (For a single location create a feasible production schedule)(minute by minute)
  • Plan of reduction of costs and management of the performance (diagnosis of the potential and the indicators, the organization and planifiaction strategic, masters dysfunctions in real-time, evaluation and accounting reporting, evaluation and reporting quality

Traditional Model

The traditional model of supply chain management follows a linear sequence of events. The order could be Marketing, design, process planning, purchasing, and vendors.

Integrated product-process design

Inter-functional integration

An inter-functional integration approach to supply chain management can be characterized by the following:

  • Concurrent engineering: This involves a cross-functional team in the NPDP (new product development process]]. Parties from the marketing department, design department, and process planning would work together to design the product.

Inter-organizational integration

This is punctuated by:

  • Early involvement of the purchasing department in the design
  • Pre-sourcing of key vendors
  • Design is driven by cost targets
  • Cross-enterprise teams which would include suppliers, customers, distributors, legal teams, accountants, and others
  • The design would be done with consideration for logistics constraints or needs

Cite Term

To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
Modern Language Association (MLA):
Supply Chain Management. Payroll & Accounting Heaven Ltd. July 04, 2020
Chicago Manual of Style (CMS):
Supply Chain Management. Payroll & Accounting Heaven Ltd. (accessed: July 04, 2020).
American Psychological Association (APA):
Supply Chain Management. Retrieved July 04, 2020, from website:

Definition Sources

Definitions for Supply Chain Management are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 29th March, 2020 | 2 Views.