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Supply Chain Management is managing the flow of goods and information along the supply chain, from procurement at source to delivery and service to the end customer.

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Introduction

University of Ulster Coleraine Faculty of Business & Management. Supply Chain Management (BMG514C2) Aislinn Newcombe Co-ordinator: Dr Patrick Ibbotson Submission: 31st March 2004 Words: 3,500 Introduction Supply Chain Management is: "... managing the flow of goods and information along the supply chain, from procurement at source to delivery and service to the end customer. ' Supply chain management is understood to be a distinct business management approach or philosophy. There are many definitions of what a supply chain is and what it involves. Cooper and Ellram (1993) describe it as an integrative philosophy to manage the total flow from the supplier to the ultimate user. However it has been recognised that supply chain management does not deal with the chain in its entirety. Christopher (1998) regards supply chain management as the management of upstream and downstream relationships with the suppliers and customers to deliver superior customer value at less cost to the supply chain as a whole. Cox (1999) has recognised that the currently dominant concept for the supply chain is based on operational effectiveness and efficency. Porters Value Chain In the physical world, intermediaries populate the value chain to provide key functions or services: * Aggregating buyers and sellers (e.g., wholesalers and retailers) * Reducing the transaction risks among them (e.g., payment methods) * Providing information (e.g., advertising and marketing) on products * Helping consumers select them (e.g., sales agents and clerks) * Customising them (e.g., changes and alterations) * Forwarding them (e.g., shipping and delivery). Businesses are constantly trying to attract and retain customers and to achieve this, value must be created added and maintained throughout the course of the value chain from the point of order to the point of delivery and beyond, if necessary. Competitive advantage comes from carrying out those activities in a more cost-effective way than ones competitors. M. Porter (1985) breaks the value chain into primary and support activities. ...read more.

Middle

Respond to enquiries If a lot of queries are received of a similar nature, these can probably be automated. These may be filtered with touch-tone dialling. But bear in mind that automated processes can sometimes be counter-productive. In some areas, customers prefer human contact. For some businesses, customer service is a money-making activity. If the business already has a technical support facility in place, advanced support could be offered for a fee. Telephone support can be financed very simply using a premium rate telephone line. The networked office is better at handling customer queries effectively. Share telephone, fax and internet capabilities so that staff can get information and receive requests directly. * Set up a customer support telephone facility, using a local rate or free phone number. * Asking customers to use their keypads to locate the service they need can save them time. * Beware of 'voice jail' - people don't like to be kept waiting before they speak to a real person. * Use internal e-mail or conference calls to solve customer problems collaboratively. Customer support Make it easier to sell on the Internet by taking steps to build customer confidence. * Security - build in industry-standard encryption procedures and publish your policy. * Privacy - many customers don't want their details passed onto third parties. Publish your policy. Even if you don't plan to create mailing lists, provide an option so that customers can exclude themselves. * Returns policy - customers will be reassured to know that faulty or unwanted goods can be returned in exchange for a full refund. Make this clear at the point of sale. * Transparency - give your customers plenty of opportunity to back out of a purchase and make it very clear when a transaction is being confirmed. Even if you don't sell online you can improve customer service by providing information on your web site. ...read more.

Conclusion

Services The importance of maintaining CRM after the initial sale is very important, as it costs roughly ten time more to acquir a customer than to retain an existing one. CONCLUSION Companies are beginning to realise the importance of CRM, as it is now apparent that product focus does not sustain growth but the customer relationship (Imhoff, C. 1998). The customers must be influenced in ways that create a mutually beneficial relationship. In conclusion it can be seen that as businesses are growing more complex so too do their supply chains, and now more than ever, managers need tools that generate the insight that leads to smarter decision making and results in a more efficient supply chain (www.bettermanagement.com). The new business logic has resulted in distinct IT tools for parts of the value chain, for example purchase (e- procurement), production (industrial IT), sales (e- commerce). Resources and competences are communicated and distributed between organisations. Development of new products or modification of old ones can easily happen Customer Relationship Management (CRM) is very popular today in companies of all sizes. These companies are realizing that a product focus will not enable them to sustain growth and they are shifting their focus to the customer. As part of this shift, they are emphasizing the value of managing mutually beneficial relationships with customers. Moving into the future, companies need to recognize that it will be the customer -- not the company -- that will be managing these relationships. The companies of the future must take actions to influence customers in ways that remain mutually beneficial. The Corporate Information Factory architecture, including the data warehouse and operational data store, provides the consistent information needed to understand each customer's needs and their value to the company. Armed with this information, the company is able to adapt its behaviour to suit each customer or customer group. It is for these reasons and many more that effective CRM is essential. The Bottom Line for Customers: Easy Integration, Fast Implementation ...read more.

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