Customer service:
Effective supply chain management is all about delivering the right product in the right quantity in the right condition with the right documentation to the right place at the right time and at the right price. Any problem arising in the above process can be solved by rectifying the problem with the use of many SC models.

Planning and Risk Management:
The supply chains must be planned and evaluated regularly and redesigned with the changing new product launches, global sourcing, new acquisitions, credit availability, the need to protect intellectual property, etc. The supply chain risk must be identified and quantified. SCOR helps to identify the potential risks and easier coordination with customers, suppliers and other stakeholders. It helps users establish rules and strategies, assign responsibilities, coordinate responses, and monitor current conditions.

Cost control:
The operating costs of supply chains are increasing because of rising freight prices, technology upgrades, rising labor rates, expanding healthcare costs, rising commodity prices and so on. To solve this problem there are number of metrics with which one can measure the success achieved in implementing the SC. The SC managers have to take the correct decisions if the objectives are not achieved.

Supplier relationship management:
Suppliers, different departments in the same organization some times follow different methods in implementing and measuring the performance and the results, this could be a problem if the results are not matched. Some models of SCM provides a common language for supply chain classification and analysis which makes easy for teams to communicate, speeds benchmarking efforts, and enhances the evaluation of best practices.

Talent:
Supply chain leaders need a thorough understanding of the key competencies required for supply chain management roles, specific job qualifications, methods for developing future talent and leaders, and the ability to efficiently source specific skill sets.

An organization should be very well planned in order to overcome challenges in SC. Overcoming these challenges in SC will only ensure success in the business.

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In 1996, Pittiglio Rabin Todd and McGrath and AMR Research developed SCOR (supply chain operations reference) model to analyze and describe all the aspects of supply chain processes. SCOR helps companies to address supply chain issues, measure performance, identify performance improvement objectives, and power the development of SCM software. SCOR includes all the supply chain metrics, the formulae associated with the metrics and a reference to best practices and their associated technology.

There are three levels in the SCOR model, they are

SCOR Level 1:
At this level a company makes basic strategic decisions regarding its operation in the areas like delivery performance, order fulfillment performance, order fulfillment lead time, perfect order fulfillment, supply chain response time, production flexibility, total supply chain management cost Value added productivity, warranty cost or returns processing, inventory days of supply and asset turns.
Companies need to decide on which of the above area they need to focus to improve their supply chain efficiencies.

SCOR Level 2:
This step defines how the supply chain type is configured and the first step in SCOR is to create a physical layout of the supply chain and after configuring the supply chain, companies measure their supply chain metrics and work to achieve the industry’s best practice standards.

SCOR Level 3:
This step gives the fine grained details that allow the companies to tune supply chain processes.

Companies by using SCOR have achieved significant improvements in supply chain efficiencies and they could cut down the number of supply chain partners. SCOR has helped them in identifying inefficiencies and configure the supply chain. The SCOR model has been undergoing continuous revision to keep pace with the changing industry requirements and practices.

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The following are five basic components of SCM.

Planning:
It is the strategic activity of SCM and the companies need a perfect planning for managing all the resources that meet the customers demand for their product or service and satisfies the customer. SCM planning is to be developed in such a way that it costs effective and delivers high quality and value to customers.

Sourcing:
Companies need to chose reliable suppliers or vendors to deliver the goods and services with which the company creates the product. Therefore, supply chain managers must develop a set of pricing, delivery and payment processes with suppliers and create metrics for monitoring and improving the relationships. The vendors should supply the inventory as per the demand and the SCM managers should also take care of the quality of the material supplied, and verify shipments, transfer them to the manufacturing facilities and authorizing supplier payments.

Making:
This is the manufacturing step in the SCM and the supply chain managers schedule the activities necessary for production, testing, packaging and preparation for delivery. In this step companies can measure quality levels, production output and worker productivity.

Delivering:
This is the step where the goods stored in the warehouses are delivered to the customers through an efficient distribution system as soon as the company receives the order from the customers and it is referred as logistics. This also includes an invoicing system to receive payments.
Return:
This is the step in the supply chain where the company receives back a defective and excess products from the customers. To effectively implement this process supply chain planners have to create a responsive and flexible network as it can be a problematic part of the supply chain for many companies.
According to Lambert and Cooper (2000) the following are the components of supply chain management:

• Planning and control
• Work structure
• Organization structure
• Product flow facility structure
• Information flow facility structure
• Management methods
• Power and leadership structure
• Risk and reward structure
• Culture and attitude

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Strategic Activities:

• Strategic activities involves optimizing networks, including the number, location, and size of warehouses, distribution centers and facilities.
• It also involves strategic partnership with suppliers, distributors, and customers, creating communication channels for critical information and operational improvements such as cross docking, direct shipping, and third-party logistics.
• Product design coordination, so that new and existing products can be optimally integrated into the supply chain, load management
• Information Technology infrastructure, to support supply chain operations and make or buy decisions.

Tactical Activities:
The tactical activities involves decision taking regarding the sourcing contracts and purchasing, production decisions, inventory decisions, including quantity, location, and quality of inventory. Transportation strategy, bench mark practices and the mile stone payments comes under the tactical activities. They also focus on customer demand and habits.

Operational Activities:
Operational activities includes daily production, distribution planning, production scheduling for each manufacturing facility, demand planning and forecasting, inbound operations, production and out bound operations. The operational concerns of the supply chain range from looking over the daily production schedules to planning distribution routes for all aspects of the supply chain.

All these activities together constitute supply chain management. Hence, supply chain management should be very efficient as it is associated with every level of business processes.

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