The taste of the consumer market has developed to a great extent and they want speedy delivery and instant gratification. Traditional supply chain approaches and practices can’t keep up with the latest trends, and they want modern and efficient solutions to their problems. Today, we’ll discuss modern supply chain management; its key elements; benefits, and differences from traditional SCM.
What is Modern Supply Chain Management?
Modern supply chain management comprises launching modular, adaptive, collaborative, and digital tools and applications by offering transparent and relevant information to all stakeholders. The modern SCM system requires only a limited number of people to operate from the organizational perspective. However, it is not useful to include various departments within the organization, when it focuses on improving the overall performance of the company.
The focus of traditional SCM is on gathering raw supplies, providing them to the manufacturer and producer, and then delivering them to the customers. The most critical factors comprised provision and supply. However, the complications of modern SC approaches are different; it results in the form of evolutionary transformation in the logistics industry.
The focus of the modern SCM system is to satisfy the needs and wishes of customers. For instance, the focus of managers is to add value to the finished product in the modern system; whereas the traditional system only focuses on distribution and logistics.
Modern SCM employs the latest and advanced technological approaches to smoothly perform its operations and functions. Integrations benefit companies to keep their products safe and secure while facilitating the flow of goods in reverse order.
However, the emphasis of modern SCM is to develop alliances, partnerships, and collaboration with trusted brands, companies, and suppliers to deliver the product to the end consumers. This approach amplifies the capability of the company to import and export products and goods globally.
Elements of Modern SCM
Some of the key elements of modern SCM are as follows;
Secure
The modern SCM would make sure that the right things, people, and systems have got access to the relevant data at the right time. They have access as long as they need it.
Intelligent
It amplifies your capability and offers you a competitive edge with advanced analytical tools and machine-based learning to make informed decisions and actions, automate business operations, optimize, and predict outcomes and results.
Collaborative
It promotes secure and rich collaboration and coordination with flexibility to systems, people, how, when, and where to work.
Connected
The modern SCM allows you to make growth and progress through systems, trading partners, uniting employees, and amplifying the extended digital system.
Benefits of Modern SCM
Some of the main benefits of modern supply chain management are as follows;
Low Risk
The risk factor is very low in the modern SCM approaches by offering you end-to-end visibility and transparency of products and goods as they make their way through the system.
Better Cashflow
It amplifies your capability to have more control over cash flow and cost when you have a visible stock level and better quality control.
Agility
Modern SCM would make it easier for you to make adjustments in your business model relevant to your supply, demand, and the wider business environment.
Transparent & Visible
Advanced and latest tracking features would help you ensure and guarantee the source of products and goods as they reach the destination.
Quality Control
Modern SCM allows you to overview the performance of packaging suppliers, assemblers, and producers. This strategy helps you to recognize problems in the system before making an impact on the system.
Collaboration with Suppliers
Your long-standing partners would help you manage temporary cashflow delays, and guide you if you are making any mistakes in the modern SCM system.
Differences B/W Traditional & Modern SCM
Some of the main differences between traditional and modern SCM are as follows;
Growth & Progress
Modern SCM allows you to speedy growth and progress than the traditional system. It is because it allows businesses and companies to employ integrated and advanced technological systems to make sure the expansion of their portfolio. However, it doesn’t happen with the traditional SCM system.
Logistics System
The modern SCM launches, plans, and controls the forward and backward movement of goods by employing the logistics management system. It makes sure the efficiency and effectiveness of the process by providing the safe delivery of the goods and products. On the other hand, the traditional SCM doesn’t employ any of the logistics management tools and applications.
Establishing Partnerships
The modern SCM promotes collaboration, alliances, and partnerships. Resultantly, companies would have better relationships with their suppliers and vendors, and it would benefit them in the long term. The traditional SCM system focuses on following a single pathway.
Conclusion: Modern Supply Chain Management
After an in-depth study of modern supply chain management; we have realized that the modern SCM system is highly significant for growth and progress. If you are learning about modern SCM systems, then you should keep in mind the abovementioned elements, benefits, and differences.
Ahsan is an accomplished researcher and has a deep insight in worldly life affairs. He goes Live 3 days a week on various social media platforms. Other than research writing, he’s a very interesting person.
