Supply Chain Evolution: Similarities and Differences

The modern supply chain differs from earlier distribution channels in its procurement strategy, but shares a crucial similarity - the importance of raw material procurement. Suppliers play a critical role in providing quality materials at competitive prices, controlling costs and product quality. Real-time data sharing and communication between parties are essential for effective supply chain management.

Strategic Purchasing and Logistics
Question: Describe a similarity or a difference between a modern supply chain versus earlier
distribution channels?
Answer: Although the current strategy implemented in supply chain management varies a lot
from the conventional distribution channels, but still there is a very crucial resemblance and is
listed as a pre-requisite for a successful channel. This involves procurement of raw materials.
Every organization needs a supplier or multiple suppliers for obtaining raw materials so that the
order from customers can be fulfilled at the earliest. This also gives time to the organization for
assessing the quality of raw materials received thereby regulating the quality and freshness of the
product delivered. The tenders passed for the procurement of raw material give enough time for
the suppliers to assess the need of the market and also that of the company. Both the traditional
and modern supply chains, however, differ in the strategies being adopted for associating more
customers, but still, the foundation parameters for starting and initiating these supply chain
management are same.
Question: The supply chain extends from needs identification to products delivery and includes
several independent activities. Please describe your perspective of the criticality of one of these
functional areas?
Answer: Supply chain involves several critical steps that are monitored by various individual
parties. However, at all time there is a real time data sharing and communication between the
focal company and its partners. This may involve links with suppliers that further communicate
with various suppliers for obtaining raw materials and connection with the wholesale distributors
which are further linked to retailers. Suppliers play an imperative and crucial role in any supply
chain management as they are responsible for providing quality raw materials, raw materials at
competitive prices that are otherwise available at higher prices in the market. All these
parameters control the cost and quality of the product leading to greater consumer satisfaction
and help supplier to build stronger alliances and effective management. Apart from providing
substantial components for manufacturing any commodity, suppliers also tend to play a
fundamental role in assessing the launch of new products. They can share the information with
their clients which helps the focal company to compete with other brands available and update
their products as per the demands of the customers.