Ryder Center for Supply Chain ManagementWhy Supply Chain Management

Profitable Business Connections

A new type of business entity is emerging—the supply chain. A supply chain is two or more parties linked by a flow of goods, information, and funds, and it is frequently global in scope. It not only includes the organization, but also its suppliers, buyers, vendors, customers, and others with whom it interacts.

Supply chain management is an interdisciplinary field that emphasizes cross-functional links and seeks to manage those links to enhance a company’s competitive advantage. It involves forecasting, resource allocation, production planning, flow and process management, inventory management, customer delivery, after-sales support and service, and a host of other activities and processes familiar and basic to business. Competitive pressures are intense.

An increasing number of companies rely on supply chain management as a key competitive weapon. Large and small businesses alike have reported astounding results, including dramatic reductions in cycle time and accelerated cash flows. The magnifier effect is stunning: a $1 reduction in cost from supply chain efficiencies is equivalent to a $12 increase in sales revenues.

Supply Chain Knowledge — a Corporate Asset

An understanding of supply chain management is an asset to any manager, and there is a strong demand for specialists in the area. Successful management of supply chain relationships requires the development of innovative business models, supply chain structures, and analytical approaches. Sophisticated techniques have been devised to expedite information flow, including on-board computers for trucks and ships, satellite tracking systems, and the electronic transmission of order and shipping information.

Entrants to the field can look forward to an entrepreneurial environment and opportunities to deal with a wide array of people from a variety of organizations.

The next generation of CEOs may very well emerge from supply chain management. Why? Because supply chain managers very often hold the key to corporate profitability. Economists and employers single out supply chain management for its strong growth potential. U.S. News & World Report describes it as one of the 20 hottest job tracks of the new century.

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