Analysis of Supply Chain Management in Automobile Sector: Tesla Inc.
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Thesis and Dissertation
AI Summary
This dissertation explores the components influencing supply chain management within the automobile sector, focusing on Tesla Inc. It begins with an introduction to the background of the study, research aims, objectives, and methodology. The literature review defines supply chain management (SCM), analyzes factors impacting its success, determines its role, and evaluates barriers. The research methodology employs qualitative research techniques, detailing research philosophies, approaches, design, data collection, and ethical considerations. The study includes data analysis and interpretation and concludes with recommendations, limitations, opportunities for further research, and reflections. The research aims to identify how supply chain management is affected by several factors within automobile corporations, using Tesla Inc. as a case study, examining the significance of SCM and suggesting improvements for automobile companies. The study uses various research methods to address the research problem, including interpretivism research philosophy and inductive and deductive approaches.

In presenting this dissertation for assessment, I declare that it is a final copy including
any last revisions. I also declare that it is entirely the result of my own work other than
where sources are explicitly acknowledged and referenced within the body of the text.
[or: in footnotes, endnotes, as appropriate]. This dissertation has not been previously
submitted for any degree at this or any other institution.
any last revisions. I also declare that it is entirely the result of my own work other than
where sources are explicitly acknowledged and referenced within the body of the text.
[or: in footnotes, endnotes, as appropriate]. This dissertation has not been previously
submitted for any degree at this or any other institution.
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Topic Related to Supply
Chain Management
Chain Management

Abstract
The present study provides the deep knowledge and understanding about the supply chain
management and its key role in the improving business performance. With help of this study,
scholar can easily identify various barriers and component that affect the function and process of
supply chain management. In the current study the major aim of the researcher is to identify the
component which influence supply chain management in the automobile sector. For achieve this
aim researcher have applied qualitative research technique by which collected information can
represent with help of charts, tables, graphs etc.
The present study provides the deep knowledge and understanding about the supply chain
management and its key role in the improving business performance. With help of this study,
scholar can easily identify various barriers and component that affect the function and process of
supply chain management. In the current study the major aim of the researcher is to identify the
component which influence supply chain management in the automobile sector. For achieve this
aim researcher have applied qualitative research technique by which collected information can
represent with help of charts, tables, graphs etc.
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TABLE OF CONTENTS
CHAPTER- 1 INTRODUCTION....................................................................................................1
1.1 Background of the study...................................................................................................1
1.2 Research aim and Objectives............................................................................................1
1.3 Justification for the Research...........................................................................................2
1.4 Outline Methodology........................................................................................................3
1.5 Chapter structure..............................................................................................................4
Chapter Summary............................................................................................................................5
CHAPTER 2- LITERATURE REVIEW.........................................................................................6
INTRODUCTION...........................................................................................................................6
2.1 Meaning and concept of the Supply Chain Management (SCM).....................................6
2.2 Analyse the factor that impact success of Supply Chain Management............................8
2.3 Determine role of Supply Chain Management...............................................................11
2.4 Evaluation of barrier which affect supply chain management.......................................13
CHAPTER- 3 RESEARCH METHODOLOGY...........................................................................17
Introduction..........................................................................................................................17
3.1 Research Philosophies....................................................................................................17
3.2 Research approach..........................................................................................................19
3.3 Research Design.............................................................................................................20
3.4 Data collection................................................................................................................21
3.5 Research administration.................................................................................................22
Research Ethics....................................................................................................................23
SUMMARY...................................................................................................................................24
CHAPTER 4 DATA ANALYSIS AND INTERPRETATION.....................................................26
4.1 Introduction....................................................................................................................26
CHAPTER 5 CONCLUSION AND RECOMMENDATION......................................................52
5.2 Analysis and interpretation.............................................................................................52
5.3 Overall conclusion and summary...................................................................................54
Recommendations................................................................................................................55
5.4 Limitation of the study...................................................................................................57
CHAPTER- 1 INTRODUCTION....................................................................................................1
1.1 Background of the study...................................................................................................1
1.2 Research aim and Objectives............................................................................................1
1.3 Justification for the Research...........................................................................................2
1.4 Outline Methodology........................................................................................................3
1.5 Chapter structure..............................................................................................................4
Chapter Summary............................................................................................................................5
CHAPTER 2- LITERATURE REVIEW.........................................................................................6
INTRODUCTION...........................................................................................................................6
2.1 Meaning and concept of the Supply Chain Management (SCM).....................................6
2.2 Analyse the factor that impact success of Supply Chain Management............................8
2.3 Determine role of Supply Chain Management...............................................................11
2.4 Evaluation of barrier which affect supply chain management.......................................13
CHAPTER- 3 RESEARCH METHODOLOGY...........................................................................17
Introduction..........................................................................................................................17
3.1 Research Philosophies....................................................................................................17
3.2 Research approach..........................................................................................................19
3.3 Research Design.............................................................................................................20
3.4 Data collection................................................................................................................21
3.5 Research administration.................................................................................................22
Research Ethics....................................................................................................................23
SUMMARY...................................................................................................................................24
CHAPTER 4 DATA ANALYSIS AND INTERPRETATION.....................................................26
4.1 Introduction....................................................................................................................26
CHAPTER 5 CONCLUSION AND RECOMMENDATION......................................................52
5.2 Analysis and interpretation.............................................................................................52
5.3 Overall conclusion and summary...................................................................................54
Recommendations................................................................................................................55
5.4 Limitation of the study...................................................................................................57
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5.5 Opportunities for Further research.................................................................................58
5.6 Reflection.......................................................................................................................58
REFERENCES..............................................................................................................................59
APPENDIX....................................................................................................................................63
5.6 Reflection.......................................................................................................................58
REFERENCES..............................................................................................................................59
APPENDIX....................................................................................................................................63

CHAPTER- 1 INTRODUCTION
TITLE
“To assess the components that influence supply chain management in Automobile sector: A
study on Tesla Inc.”
1.1 Background of the study
In today's time, there is very huge competition among the corporations and every
business firm, design a distinctive strategies and tactics for compete with rivals. With assistance
of the effective strategies and tactics, corporation can easily develop its own brand image and
attract the large number of customer toward the firm. In this manner, supply chain management
is one of the strategy by which company can easily deliver its commodity to the end users. It is a
kind of concept under which product and services can delivers from manufacturer to final
customers in the market and satisfy their needs related to product and services. With assistance
of the supply chain management, quality of product and services can improve by the
manufacturer and reduce cost effects. There are various kinds of the software which can assist in
improving the inventory management system. The ultimate goal of any effective supply chain
management system is to overcome inventory from the operation of business. Supply chain
management flows can be divided into three main flows that is product flow, information flow ad
finance flow.
In the present time, in every business sector like retail, hospitality, travel and tourism,
entertainment etc., required an impressive and well managed supply chain management system
by which it can effectively deliver at the customer and meet the requirement of them related to
the goods and services. In simple words it can be said that supply chain management is very
important aspect within the company by which firm's product and services can effectively move
from manufacturer to final consumers.
In the present dissertation, the major objective of the researcher is to identify the
component which influence supply chain management in the automobile sector. Auto mobile
industry is one of the largest in the world which annual production of 23.96 million vehicles in
2015-16. In this industry, supply chain management plays a very crucial role by which company
produce and deliver the product from manufacturer to final consumers.
1.2 Research aim and Objectives
Aim
1
TITLE
“To assess the components that influence supply chain management in Automobile sector: A
study on Tesla Inc.”
1.1 Background of the study
In today's time, there is very huge competition among the corporations and every
business firm, design a distinctive strategies and tactics for compete with rivals. With assistance
of the effective strategies and tactics, corporation can easily develop its own brand image and
attract the large number of customer toward the firm. In this manner, supply chain management
is one of the strategy by which company can easily deliver its commodity to the end users. It is a
kind of concept under which product and services can delivers from manufacturer to final
customers in the market and satisfy their needs related to product and services. With assistance
of the supply chain management, quality of product and services can improve by the
manufacturer and reduce cost effects. There are various kinds of the software which can assist in
improving the inventory management system. The ultimate goal of any effective supply chain
management system is to overcome inventory from the operation of business. Supply chain
management flows can be divided into three main flows that is product flow, information flow ad
finance flow.
In the present time, in every business sector like retail, hospitality, travel and tourism,
entertainment etc., required an impressive and well managed supply chain management system
by which it can effectively deliver at the customer and meet the requirement of them related to
the goods and services. In simple words it can be said that supply chain management is very
important aspect within the company by which firm's product and services can effectively move
from manufacturer to final consumers.
In the present dissertation, the major objective of the researcher is to identify the
component which influence supply chain management in the automobile sector. Auto mobile
industry is one of the largest in the world which annual production of 23.96 million vehicles in
2015-16. In this industry, supply chain management plays a very crucial role by which company
produce and deliver the product from manufacturer to final consumers.
1.2 Research aim and Objectives
Aim
1
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“The aim of the dissertation is to identify that how supply chain management affects by several
factors within automobile corporation: A case study of Tesla Inc.
Objective
To understand the current literature on the factor that affects successive supply chain
management
To understand the current literature of supply chain management in success of Tesla Inc.
To evaluate barriers that affect supply chain management of Tesla Inc.
To examine the significance of supply chain management within the automobile
corporation
To suggest the way through which supply chain management in the automobile company
can better perform.
Research Question
Research question is significant term in the entire dissertation by which objective and
literature re review can design by the scholar. In the present study, scholar has designed several
questions for achieve the objective.
What are the major factors which influence supply chain management with respect of
Tesla Inc.?
1.3 Justification for the Research
Supply chain management is a significant aspect by which corporation can delivers the
commodities. The present study has major objective is to analyse the components of supply
chain management which impact on the industry of auto mobile. This study assists to the
investigator to acquire knowledge about various components of supply chain management which
largely influence to the automobile companies. Scholar has selected this subject in order to get
the understanding about the supply chain management. Researcher has huge interest in this topic
and scholar wanted to identify several elements of supply chain management which influence the
organisations in the auto mobile industry.
The present study provides the deep knowledge and understanding about the supply chain
management and its key role in the improving business performance. With help of this study,
2
factors within automobile corporation: A case study of Tesla Inc.
Objective
To understand the current literature on the factor that affects successive supply chain
management
To understand the current literature of supply chain management in success of Tesla Inc.
To evaluate barriers that affect supply chain management of Tesla Inc.
To examine the significance of supply chain management within the automobile
corporation
To suggest the way through which supply chain management in the automobile company
can better perform.
Research Question
Research question is significant term in the entire dissertation by which objective and
literature re review can design by the scholar. In the present study, scholar has designed several
questions for achieve the objective.
What are the major factors which influence supply chain management with respect of
Tesla Inc.?
1.3 Justification for the Research
Supply chain management is a significant aspect by which corporation can delivers the
commodities. The present study has major objective is to analyse the components of supply
chain management which impact on the industry of auto mobile. This study assists to the
investigator to acquire knowledge about various components of supply chain management which
largely influence to the automobile companies. Scholar has selected this subject in order to get
the understanding about the supply chain management. Researcher has huge interest in this topic
and scholar wanted to identify several elements of supply chain management which influence the
organisations in the auto mobile industry.
The present study provides the deep knowledge and understanding about the supply chain
management and its key role in the improving business performance. With help of this study,
2
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scholar can easily identify various barriers and component that affect the function and process of
supply chain management. In addition to this, with assistance of this study, company can also
beneficial to know the various components which affect the system of supply chain management.
Automobile companies can easily analyse various strategy by which it can improve is supply
chain system and function with help of this present dissertation.
This research fulfils the gap between the desired result and actual outcome because with
help of this investigation, scholar can effectively acknowledge the factor that can affect the
supply chain management in an organisation.
Supply chain management is one of the most important aspects in the company by which
all information, resources, product and services is delivered from the corporation to final
consumer. However, this supply chain management process can affect by the various
components. In the absence of proper and systematic supply chain management, company cannot
able to attain its determined success (Oelze and et.al., 2016).
https://www.nature.com/articles/ismej201697
It is very important for the corporation to understand various factor and its impact on the
business activities and function. Improper understanding of component of supply chain
management can create the issue for the organisation. In addition to this, selection of effective
method of supply chain management is also very important because wrong selection of supply
chain method can create the problem for company.
1.4 Outline Methodology
Research methodology is another major important chapter in the dissertation which
included various methods such as research approach, research philosophies, research design, data
collection, data analysis, sampling etc. With help of all these mentioned methods and techniques,
scholar can easily address the actual solution of the research problem.
This method assists to scholar in getting the depth knowledge and understanding about
the subject. It is very important for the researcher is to select an appropriate method of the
3
supply chain management. In addition to this, with assistance of this study, company can also
beneficial to know the various components which affect the system of supply chain management.
Automobile companies can easily analyse various strategy by which it can improve is supply
chain system and function with help of this present dissertation.
This research fulfils the gap between the desired result and actual outcome because with
help of this investigation, scholar can effectively acknowledge the factor that can affect the
supply chain management in an organisation.
Supply chain management is one of the most important aspects in the company by which
all information, resources, product and services is delivered from the corporation to final
consumer. However, this supply chain management process can affect by the various
components. In the absence of proper and systematic supply chain management, company cannot
able to attain its determined success (Oelze and et.al., 2016).
https://www.nature.com/articles/ismej201697
It is very important for the corporation to understand various factor and its impact on the
business activities and function. Improper understanding of component of supply chain
management can create the issue for the organisation. In addition to this, selection of effective
method of supply chain management is also very important because wrong selection of supply
chain method can create the problem for company.
1.4 Outline Methodology
Research methodology is another major important chapter in the dissertation which
included various methods such as research approach, research philosophies, research design, data
collection, data analysis, sampling etc. With help of all these mentioned methods and techniques,
scholar can easily address the actual solution of the research problem.
This method assists to scholar in getting the depth knowledge and understanding about
the subject. It is very important for the researcher is to select an appropriate method of the
3

research philosophy. Interpritivism research philosophy assists to the researcher in obtaining the
right solution of research problem.
In the above research inductive and deductive are two approaches which has been taken
in consideration. Other than this there is one more approach which is included in research
approach that is adductive research approach. The main aim is to produce the thing in effective
manner. In the present study, the major objective of the researcher is to analyse and assess the
factors that affect supply chain management within the automobile corporation Tesla.
Research design is another one of the most significant part in the research methodology
by which investigation can address the right solution of the research study. It is a blue print for
collecting and assessing the information. By applying various theories and models in the study,
each element can effective discussed. Thus, it can be said that, descriptive research design is
effective too to analyse and assess the factors that affect supply chain management function in
the company.
This is another one of the major method in the research methodology by which scholar
can collect, analyse, interpret and assess the information about the subject. Research technique
provides the answer to the questions by making analysis as well as sense of unstructured area.
1.5 Chapter structure
In the entire dissertation various chapter included which help to scholar in accomplish the
stud in an appropriate manner. Each chapter in the dissertation plays a very significant role by
which study can accomplish. Following are various chapter in this present dissertation-
Chapter 1: Introduction- This is one of the most important chapter in entire study
which provides the background of study. With help of this chapter, researcher can able to
design aim, objective, research question of the study.
Chapter 2: Literature Review- This is another major important chapter in the
dissertation through which researcher provides the deep knowledge and understanding
about the topic. In this chapter, scholar have included various themes related to the
supply chain management which provides detail understanding about the subject.
4
right solution of research problem.
In the above research inductive and deductive are two approaches which has been taken
in consideration. Other than this there is one more approach which is included in research
approach that is adductive research approach. The main aim is to produce the thing in effective
manner. In the present study, the major objective of the researcher is to analyse and assess the
factors that affect supply chain management within the automobile corporation Tesla.
Research design is another one of the most significant part in the research methodology
by which investigation can address the right solution of the research study. It is a blue print for
collecting and assessing the information. By applying various theories and models in the study,
each element can effective discussed. Thus, it can be said that, descriptive research design is
effective too to analyse and assess the factors that affect supply chain management function in
the company.
This is another one of the major method in the research methodology by which scholar
can collect, analyse, interpret and assess the information about the subject. Research technique
provides the answer to the questions by making analysis as well as sense of unstructured area.
1.5 Chapter structure
In the entire dissertation various chapter included which help to scholar in accomplish the
stud in an appropriate manner. Each chapter in the dissertation plays a very significant role by
which study can accomplish. Following are various chapter in this present dissertation-
Chapter 1: Introduction- This is one of the most important chapter in entire study
which provides the background of study. With help of this chapter, researcher can able to
design aim, objective, research question of the study.
Chapter 2: Literature Review- This is another major important chapter in the
dissertation through which researcher provides the deep knowledge and understanding
about the topic. In this chapter, scholar have included various themes related to the
supply chain management which provides detail understanding about the subject.
4
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Chapter 3: Research Methodology- Research methodology is another major important
chapter in the dissertation which included various method such as research approach,
research philosophies, research design, data collection, data analysis, sampling etc
Chapter 4: Data analysis and interpretation- Data analysis and finding is another
major important chapter in the dissertation by which researcher can easily collect and
analyse the information about the topic.
Chapter 5: Recommendation and Conclusion- This is another important chapter in the
dissertation by which finally conclude the result of entire dissertation by the researcher.
Chapter Summary
In the present dissertation, the major objective of the researcher is to identify the
component which influence supply chain management in the automobile sector. Auto mobile
industry is one of the largest in the world which annual production of 23.96 million vehicles in
2015-16. In this industry, supply chain management plays a very crucial role by which company
produce and deliver the product from manufacturer to final consumers. In the present
dissertation, scholars have main intension to identify the factors which affect the process of
supply chain management with respect of Tesla Inc. The present study has included the
importance of the supply chain management in manufacturing and delivering the automobile
product to the final consumer. With assistance of this research study, researcher can easily get
detail knowledge and understanding about the barriers and factors that influence supply chain
management activities and functions in the organisation.
5
chapter in the dissertation which included various method such as research approach,
research philosophies, research design, data collection, data analysis, sampling etc
Chapter 4: Data analysis and interpretation- Data analysis and finding is another
major important chapter in the dissertation by which researcher can easily collect and
analyse the information about the topic.
Chapter 5: Recommendation and Conclusion- This is another important chapter in the
dissertation by which finally conclude the result of entire dissertation by the researcher.
Chapter Summary
In the present dissertation, the major objective of the researcher is to identify the
component which influence supply chain management in the automobile sector. Auto mobile
industry is one of the largest in the world which annual production of 23.96 million vehicles in
2015-16. In this industry, supply chain management plays a very crucial role by which company
produce and deliver the product from manufacturer to final consumers. In the present
dissertation, scholars have main intension to identify the factors which affect the process of
supply chain management with respect of Tesla Inc. The present study has included the
importance of the supply chain management in manufacturing and delivering the automobile
product to the final consumer. With assistance of this research study, researcher can easily get
detail knowledge and understanding about the barriers and factors that influence supply chain
management activities and functions in the organisation.
5
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CHAPTER 2- LITERATURE REVIEW
INTRODUCTION
Literature review is one of the most important chapter in the dissertation by which
researcher can obtain information about the subject. In this chapter, several kinds of themes can
be included which helps scholar in getting effective knowledge and understanding about the
subject. In the absence of this chapter, it is impossible to conduct the investigation and gather
information about the topic. It is just kind of secondary data which is collected from different
books, journals, online articles, blogs etc. In the current research study, researcher has included
information which is stated by several authors. Moreover, for attaining the objective of study,
several themes about the topic has been designed by scholar which are discussed below-
2.1 Meaning and concept of the Supply Chain Management (SCM)
As per the view of Ashby, Leat and Hudson-Smith, (2012) in the business enterprise,
Supply Chain Management is one of the significant aspect by which firm can flow the goods and
services to the customer and in this procedure, major three terms are included such as finished
good, semi-finished good, work in progress and raw materials. Basically, it shows the
contribution of suppliers under which they carry out various activities such as production,
distribution, packaging etc. SCM is the most crucial aspect by which company can achieve its
determined goal because without this concept, no firm can develop its target and cannot attain its
objective.
In the opinion of Christopher, (2016) supply chain is a network of people and businesses
that work together for converting the raw material into the final finished goods and services. It is
the activity by which customer can gain the effective value and satisfaction from the goods and
services. It is the active integration and coordination of all supply chain activities by which
customer can gain the effective satisfaction. With help of SCM, company can develop its own
competitive advantage and develop its own brand image in the market because with help of this
system, it can deliver impressive satisfaction to customer. Thus, it can be said that SCM is a kind
of company strategy to build an impressive goodwill in the market and attract the large number
of customers. In the contradicting view Wu and Chiu, (2018) said that supply chain management
6
INTRODUCTION
Literature review is one of the most important chapter in the dissertation by which
researcher can obtain information about the subject. In this chapter, several kinds of themes can
be included which helps scholar in getting effective knowledge and understanding about the
subject. In the absence of this chapter, it is impossible to conduct the investigation and gather
information about the topic. It is just kind of secondary data which is collected from different
books, journals, online articles, blogs etc. In the current research study, researcher has included
information which is stated by several authors. Moreover, for attaining the objective of study,
several themes about the topic has been designed by scholar which are discussed below-
2.1 Meaning and concept of the Supply Chain Management (SCM)
As per the view of Ashby, Leat and Hudson-Smith, (2012) in the business enterprise,
Supply Chain Management is one of the significant aspect by which firm can flow the goods and
services to the customer and in this procedure, major three terms are included such as finished
good, semi-finished good, work in progress and raw materials. Basically, it shows the
contribution of suppliers under which they carry out various activities such as production,
distribution, packaging etc. SCM is the most crucial aspect by which company can achieve its
determined goal because without this concept, no firm can develop its target and cannot attain its
objective.
In the opinion of Christopher, (2016) supply chain is a network of people and businesses
that work together for converting the raw material into the final finished goods and services. It is
the activity by which customer can gain the effective value and satisfaction from the goods and
services. It is the active integration and coordination of all supply chain activities by which
customer can gain the effective satisfaction. With help of SCM, company can develop its own
competitive advantage and develop its own brand image in the market because with help of this
system, it can deliver impressive satisfaction to customer. Thus, it can be said that SCM is a kind
of company strategy to build an impressive goodwill in the market and attract the large number
of customers. In the contradicting view Wu and Chiu, (2018) said that supply chain management
6

is that function within the organisation that affect the performance of business in large manner. If
organisation have effective supply chain management function, then it becomes easy to achieve
higher level of outcome of the business.
According to the view of Danping and Lee, (2011) SCM is a process which is organised
by the company in order to meet the requirement of customer related to goods and services. By
conducting these activities in the organisation, management can design competitive advantage
through which it can improve profitability and market share. While company conducts the
program of SCM, then it requires considering various activities such as logistics information
system, product design etc. These activities help the firm in improving the quality of services and
attracting large numbers of customers.
SCM is an essential and crucial part of the business enterprise by which company can
attain its success and determined growth. Supply chain helps in improving customer service and
satisfaction level. Most of the customer requires and expects high quality of product and services
in minimum time and perfect quantity. For example, if customer orders three books from
Amazon and only one of the actual arrives, then the customer will lose faith in Amazon. Thus, it
can be said that with help of proper SCM, company can gain the customer loyalty and faith. On
the other hand, if company's SCM does not work properly, then it will lose the customer trust
and loyalty.
On the contradicting view Dubey and et.al., (2017) effective SCM also helps in reducing
operating cost of the corporation. With help of this mentioned concept, company can reduce the
purchasing cost, production cost and total supply chain cost. With help of effective SCM,
company can improve financial position of the corporation. It assists in improving the
profitability, cash flow and leverage of the organisation. With assistance of the supply chain
management aspect within the organisation, it become easily to overcome the operation cost and
production cost. Kauffman, Pathak, Sen and Choi, (2018) stated that supply chain management
do not only overcome operation cost but also it helps in overcoming the supply chain cost.
In the opinion of Fernie and Sparks, (2014) SCM is a management of material and
information which provide the highest degree of customer satisfaction at the lowest possible cost.
7
organisation have effective supply chain management function, then it becomes easy to achieve
higher level of outcome of the business.
According to the view of Danping and Lee, (2011) SCM is a process which is organised
by the company in order to meet the requirement of customer related to goods and services. By
conducting these activities in the organisation, management can design competitive advantage
through which it can improve profitability and market share. While company conducts the
program of SCM, then it requires considering various activities such as logistics information
system, product design etc. These activities help the firm in improving the quality of services and
attracting large numbers of customers.
SCM is an essential and crucial part of the business enterprise by which company can
attain its success and determined growth. Supply chain helps in improving customer service and
satisfaction level. Most of the customer requires and expects high quality of product and services
in minimum time and perfect quantity. For example, if customer orders three books from
Amazon and only one of the actual arrives, then the customer will lose faith in Amazon. Thus, it
can be said that with help of proper SCM, company can gain the customer loyalty and faith. On
the other hand, if company's SCM does not work properly, then it will lose the customer trust
and loyalty.
On the contradicting view Dubey and et.al., (2017) effective SCM also helps in reducing
operating cost of the corporation. With help of this mentioned concept, company can reduce the
purchasing cost, production cost and total supply chain cost. With help of effective SCM,
company can improve financial position of the corporation. It assists in improving the
profitability, cash flow and leverage of the organisation. With assistance of the supply chain
management aspect within the organisation, it become easily to overcome the operation cost and
production cost. Kauffman, Pathak, Sen and Choi, (2018) stated that supply chain management
do not only overcome operation cost but also it helps in overcoming the supply chain cost.
In the opinion of Fernie and Sparks, (2014) SCM is a management of material and
information which provide the highest degree of customer satisfaction at the lowest possible cost.
7
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