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Components of supply chain management integration

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The management components of SCM

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The SCM components are the third element of the four-square circulation framework. The level of integration and management of a business process link is a function of the number and level, ranging from low to high, of components added to the link (Ellram and Cooper, 1990; Houlihan, 1985). Consequently, adding more management components or increasing the level of each component can increase the level of integration of the business process link. The literature on business process re-engineering,[10] buyer-supplier relationships,[11] and SCM[12] suggests various possible components that must receive managerial attention when managing supply relationships. Lambert and Cooper (2000) identified the following components:

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However, a more careful examination of the existing literature[13] leads to a more comprehensive understanding of what should be the key critical supply chain components, the \"branches\" of the previous identified supply chain business processes, that is, what kind of relationship the components may have that are related to suppliers and customers. Bowersox and Closs states that the emphasis on cooperation represents the synergism leading to the highest level of joint achievement (Bowersox and Closs, 1996). A primary level channel participant is a business that is willing to participate in the inventory ownership responsibility or assume other aspects of financial risk, thus including primary level components (Bowersox and Closs, 1996). A secondary level participant (specialized) is a business that participates in channel relationships by performing essential services for primary participants, including secondary level components, which support primary participants. Third level channel participants and components that support the primary level channel participants and are the fundamental branches of the secondary level components may also be included.

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Consequently, Lambert and Cooper's framework of supply chain components does not lead to any conclusion about what are the primary or secondary (specialized) level supply chain components (see Bowersox and Closs, 1996, p. 93). That is, what supply chain components should be viewed as primary or secondary, how should these components be structured in order to have a more comprehensive supply chain structure, and how to examine the supply chain as an integrative one (See above sections 2.1 and 3.1).

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Reverse Supply Chain Reverse logistics is the process of managing the return of goods. Reverse logistics is also referred to as \"Aftermarket Customer Services\". In other words, any time money is taken from a company's warranty reserve or service logistics budget one can speak of a reverse logistics operation.

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