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I agree with the author that cost reduction across the supply chain will resulted from an effective supply chain management (SCM). This can be done by avoiding excessive inventory, good warehouse management, lower procurement cost, lower transportation cost and waste reduction from lean manufacturing (Austen Jones).Furthermore, improve inventory management, facilitating the successful implementation of just-in-time stock models and eliminating the strain on real estate and financial resources incurred by the storage of excess components and finished goods.
Increase in inventory turnover and subsequently in revenue can be achieved by providing after sales service (Sotiris Zigiaris, 2000) and deliver the ordered products to customer at the right time, place and quantity.
Besides that, a supplier selection and the focus of relationship management in effective SCM can ensure the continuous and sufficient supply to organization in good quality. Thus, it ensures product availability to customers (Robert Handfield, 2011).
In addition, the optimal carrier selection, carrier capacity and space utilization can actually helps to reduce logistic cost (IBM Global Business Service).
When pull strategy take place, an effective SCM will ensure the customer’s order is flow to the right person in the supply chain so that the customer demand can be fulfilled as soon as possible. Thus, the order cycle times will be reduced as it leads to smooth flow of information within the supply chain and ensure product is delivered to end user as soon as possible without any disruption and delay.
Bridges (add definition)
Bridges is known as the solution to overcome barriers in order to gain benefits. (Lincoln Christopher Wood, 2010)
An effective supply chain management should have a transparent information system. The partners in a supply should have a regular meeting to discuss any problem raised, open sharing of information as well as the sharing of new idea or new...
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