Introduction to Supply Chain Management

HANDFIELD, ROBERT B. AND NICHOLS, ERNEST L., JR. 1999, Introduction to Supply Chain Management, Prentice Hall, Upper Saddle River, New Jersey, vii + 183 pp., $29.33.

Globalization. World class. Unparalleled advances in technology. Unprecedented competitiveness. Customer needs and satisfaction. Contrast these with the basic and simple concept of taking raw material, converting it into a product, and selling it to a customer. Surely this cannot be difficult or complex. Handfield and Nichols present the concept of the supply chain against the background of the "logistics renaissance." Things are not that simple in meeting ever-changing customer needs and escalating demand for new products, and in getting products to customers in a cost-effective manner when, where, how, and in the right quantities. This era has spawned new challenges of time-reducing information technologies and logistics networks so that firms must manage the network of upstream firms that provide inputs as well as those downstream responsible for delivering products and service. Handfield and Nichols give a concise and clear give introduction to integrated supply-chain management.

Handfield and Nichols define the terms supply chain and supply chain management as follows:

(1) "The supply chain encompasses all activities associated with the flow and transformation of goods from the raw materials stage (extraction), through to the end user, as well as the associated information flows. Material and information flow both up and down the supply chain."

(2) "Supply Chain Management (SCM) is the integration of these activities through improved supply chain relationships, to achieve a sustainable competitive advantage."

The supply chain includes the management of information, sourcing and procurement, production scheduling, order processing, inventory management, warehousing, customer service, and after-market disposition of packaging and materials. All organizations that provide inputs, directly or indirectly, form part of the supplier network. Supply chains are links of suppliers and customers; every customer in turn is a supplier to the next link in the chain until a finished product reaches the ultimate end user. In essence, the supply chain includes internal functions, upstream suppliers, and downstream customers. All of these have to be managed.

This book consists of six chapters. In the introduction, Handfield and Nichols outline, in a very understandable way and through the use of examples and figures, what the supply chain entails. It...