Supply chain management (SCM) is an integrated management philosophy and methodology that performs functions such as planning and control over logistics within the supply chain, from suppliers to the end-users. From a single corporate perspective, it refers to a company's efforts to enhance upstream and downstream supply chain relationships, integrate and optimize the information flow, logistics, and capital flow within the supply chain to gain a competitive edge.
Supply chain management is a key aspect of effective business operation, demonstrating an organization's optimization of the entire operational process on both strategic and tactical levels. It integrates and enhances the operational efficiency of suppliers, manufacturers, and retailers, ensuring that products are produced and sold in the right quantity, quality, location, at the right time, and at the best cost.
The modern business environment imposes immense pressure on companies, not only in selling products but also in providing satisfactory services to customers and consumers to enhance customer satisfaction and foster a sense of happiness. Kotle says, "The customer is king, without them, a company cannot survive. All plans must revolve around retaining and satisfying customers." To win customers in both domestic and international markets, it is imperative for supply chain companies to be able to respond quickly, agilely, flexibly, and collaboratively to customer needs. In the face of a fluctuating supply chain environment, building a happy supply chain has become a development trend for modern enterprises.
The National Standard for Logistics Terminology (GB/T 18354-2001) defines supply chain management as the utilization of computer network technology to plan the business flow, logistics, information flow, and capital flow within the supply chain, and to carry out planning, organization, coordination, and control.
The Global Supply Chain Forum (GSCF) defines supply chain management as an integrated business process from the source supplier to the end consumer, delivering valuable products, services, and information to consumers.
