Supply Chain Management
Dr. Lambert has been at the forefront of the development of new thinking in logistics and supply chain management for more than 40 years. Since 1992 his research has focused on two primary areas: (1) the theory and practice of supply chain management and, (2) building and sustaining tailored business relationships with key customers and suppliers to achieve a competitive advantage.
What is Supply Chain Management?
The Supply Chain is not a business function, it is a network of companies and Supply Chain Management is the implementation of cross-functional relationships with key customers and suppliers in that network. It is a new business model necessary for an organization’s success and every business function needs to be involved. Management must recognize that the ultimate success of an organization depends on the ability to integrate the company’s network of business relationships in a mutually beneficial way. The management of this network of relationships is supply chain management. Successful supply chain management requires cross-functional integration within the firm and across the network of firms that comprise the supply chain. It is focused on the improvements in performance that result from better management of key relationships. By understanding the supply chain management processes and how they should be implemented, management will better understand the value of more integrated supply chains and how this integration will lead to increased shareholder value and a sustainable competitive advantage.
The COVID-19 pandemic exposed the folly of trying to manage a network of companies with three business functions, purchasing, logistics and manufacturing, all judged on the basis of how much money did you save this year. Responsibility for SCM should rest with the company’s CEO and the leadership team, and the focus should be on value co-creation to drive revenues and profitability.
The Supply Chain Management Processes
Supply chain management is the management of relationships in the network of organizations, from end customers through original suppliers, using key cross-functional business processes to create value for customers and other stakeholders.
Successful supply chain management requires implementing cross-functional processes within the company and integrating them with key members of the supply chain. Valuable resources are wasted when supply chains are not integrated, appropriately streamlined, and managed. The value of having standard business processes in place is that managers from different organizations in the supply chain can use a common language and can link-up their firms’ processes with other members of the supply chain, as appropriate.
Over a period of more than 20 years, Dr. Lambert and a team of faculty and executives developed a comprehensive cross-functional, cross-firm, supply chain management framework based on eight key business processes. Each process is managed by a cross-functional team, including representatives from logistics, production, purchasing, finance, marketing and research and development. While each process will interface with key customers and suppliers, the customer relationship management and supplier relationship management processes form the critical linkages in the supply chain.