Supply chain management is one of the most important twentieth-century innovations in the business world. Practically, it is the managing of a “network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers” (Cooper et al., 7).
In other words, it takes care of all the transporting, storing and distributing of what the firm considers to be raw materials. It also does the inventory of the work which is in progress and of the final goods, the finished products. Practically it takes a product from its conception, design until it is delivered to the market for the consumers.
Yet another way of explaining the definition is given from the Simchi-Levi brothers, who see it as the “design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand, and measuring performance globally” (Simchi-Levi et al., 4). Here one major ethical problem is that this way, supply chain management is a sort of controlling system for all the other processes and departments in the organization, company.
This is especially true for a company that makes the moving of goods and personal effects of people its primary product, like TNT Global Logistics. This is why supply chain management has to monitor the working of all the other departments of a firm. But who controls supply chain management? It is a sort of ‘all encompassing’ department or managing technique, on which no other department in the business firm can control. Legally, it means that this department has some competencies more extended than any other in the company.
This is inevitable since it has to control the ongoing process of design, production and delivery of products. It must have the power to intervene in the process if something is going wrong or not as planned. The metrics and measures are very important for the supply chain management. Those are the tools by which it ‘measures performance’ (Ketchen & Hult, 24). The integrated measures are the ones included in the processes of supply management. These metrics serve as indicators to demonstrate how is going the process, at least on the principal tenants. For TNT, such integrated measures, or metrics, can be the timing of reaction for the pickup of the goods from the moment a client informs he/she wants to deliver a package. Another integrated metric would be the timing of delivery, the schedule of the goods. If they are delivered within the estimated time, the process is going as it should.
But there are also external metrics that are used as indicators for performance. Many authors consider customer satisfaction to be the most important of these indicators (Mentzer, 56). The above mentioned internal metrics could read all positive, but still, something may not be all right in the process. Customer satisfaction will show this.
And for companies like TNT, customer satisfaction is crucial. By measuring the ‘output’ to customers, we can have a clearer picture of the company’s financial health. Measuring output for TNT means measuring customer satisfaction. If something is going wrong, then an evaluation or resource usage is needed to assess what is going wrong. And a final external metric for the health of the company would be its flexibility to respond and adapt to new and changing situations.
Works Cited
Cooper, Michael., Lambert, Daniel & Pagh, John. “Supply Chain Management: More Than a New Name for Logistics”. The International Journal of Logistics Management, Vol 8, Iss 1, 1997.
Ketchen Jr., Greg & Hult, Tim. “Bridging organization theory and supply chain management: The case of best value supply chains”. Journal of Operations Management, 25(2), 2006.
Mentzer, Javier. “Defining Supply Chain Management”, Journal of Business Logistics, Vol. 22, No. 2, 2001.
Simchi-Levi Daniel. Simchi-levi, Elvis. Designing and Managing the Supply Chain, 3rd edition. Canada: Mcgraw Hill, 2007.