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You Have to Define it Before You Can Refine it.

I talk a lot about the “Lean” Supply Chain in this blog, but I think it would go a long way to first get a universal definition and understanding of what it’s all about to really take the concept to the next level in terms of continuous improvement.

A new article in the Journal of Supply Chain Management  entitled “Evolving Functional Perspectives within Supply Chain Management” by Zacharia, Sanders and Fugate (the first two are Professors at Lehigh University where I am on the faculty) points out that despite the emergence and importance of the Supply Chain concept in the past 25 years or so, there is “little agreement on the domain and unifying theory of SCM, as well as a consensus definition, The result has been a lack of clarity as to the scope of SCM, “siloed” research methodologies, and parallel research efforts.”

I personally like to use a broad definition of Supply Chain Management, a good example of which comes from the CSCMP (Council of Supply Chain Management Professionals) which states: “Supply chain management encompasses the planning and management of all activities involved in sourcing, procurement, conversion, and logistics management…It also includes the crucial components of coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers.”

Furthermore, I find it useful to refer to the field as “Supply Chain & Logistics Management”, as often in industry (and somewhat in academia) people tend to focus on the Sourcing and Procurement aspect of Supply Chain only, instead of a broader definition as described above.

The SCOR (Supply Chain Operations Reference Model) of “Plan, Source, Make, Deliver and Return” is also a great way to describe, benchmark and measure your Supply Chain.

No matter how you define it, as the Zacharia, Sanders and Fugate research points out it is critical “to better understand the evolving roles and perspectives of various functions within SCM and consider opportunities to collaborate across functions to better address complex, intractable SCM problems.” This validates the idea that one of the keys to a Lean Supply Chain is collaboration and visibility among internal functions, customers, suppliers and partners and to accomplish this you need to have a common understanding of where an organization is and where it’s going, especially from a Supply Chain perspective.

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