This is a basic definitive question that employers may ask to ensure you can describe supply chain management to customers or other employees. Interviewers are typically looking for a simple answer that clearly defines the term in a way that’s easy to understand.
Supply chain management is the management of the flow of goods and services and includes all processes that transform raw materials into final products. It involves the active streamlining of a business’s supply-side activities to maximize customer value and gain a competitive advantage in the marketplace.
KEY TAKEAWAYS
Supply chain management (SCM) is the centralized management of the flow of goods and services and includes all processes that transform raw materials into final products.
By managing the supply chain, companies can cut excess costs and deliver products to the consumer faster.
Good supply chain management keeps companies out of the headlines and away from expensive recalls and lawsuits.
The five most critical elements of SCM are developing a strategy, sourcing raw materials, production, distribution, and returns.
A supply chain manager is tasked with controlling and reducing costs and avoiding supply shortages.