Supply Chain Management: Definition, Jobs, Salary, and More

Supply change management aligns product supply with customer demand. As the world becomes more interconnected and manufacturing resources are spread across the globe, supply chain management ensures production remains cost-effective, customers remain happy, and deliveries are consistent.

If you enjoy seeing the big picture and have a knack for helping companies run efficiently, you might consider a career in supply chain management.

Read on to gain further insight into supply chain management, why it's important, and how it works. Discover various jobs in the field, explore salary projections, and find cost-effective courses to help you get started today.

What is supply chain management?

Supply chain management refers to the coordination and oversight of various activities involved in the production, distribution, and delivery of goods or services from their source to the end consumer. This entails everything from sourcing the raw components for a product to delivering the final result directly to the consumer.

Part of working in supply chain management is figuring out how your company can maximise productivity, sustain production, grow within the market, and provide the most convenient experience for the customer.

Supply chain managers have two key responsibilities:

1. Ensure that customers can obtain products.

2. Ensure that the manufacturer can obtain the materials they need to create the product.

The consumer market can be competitive, so it's important for businesses to make sure their products are in stock when consumers want to purchase something. In addition, if a customer orders an item online and it takes a long time to arrive (or worse—it never arrives), they will be less likely to order from the same company again. 

To ensure that happens, supply chain professionals source materials, locate manufacturing partners, coordinate delivery services, and facilitate convenient return methods. Having a supply chain that maximises productivity and efficiency gives the company opportunities to expand and keeps revenue flowing.

Why is supply chain management important?

Effective supply chain management is important for all companies that distribute goods, services, and products because, if not managed well, supply chains can quickly break down and delay production. This creates internal stress and revenue loss in the company. It can also lead to detrimental customer loss and a lower company reputation. Certain suppliers and manufacturers are particular about the types of companies they work for, so having a solid company reputation with reliable key players will help to secure beneficial supply chain partners.

As a supply chain manager, you are one of the key people responsible for promoting business sustainability and positive customer experiences. These are essential for the business's productivity and success. Supply chain management is also key to staying on top of the market and sustaining a loyal customer base. 

How does supply chain management work?

Supply chain manager responsibilities typically include five critical areas of work: Planning, sourcing, organising, delivering, and managing. Each area has specific tasks for the supply manager. 

1. Planning the supply chain network

Before solidifying any contracts with suppliers or putting the product on the market, you carefully plan each “link” in the chain. You want to ensure a seamless transition between steps and that every stakeholder knows their responsibilities. Another aspect of this is efficiency. If one component of the supply chain lags behind the others, it creates a “kink” in the chain and slows the entire production. This can delay the product getting to consumers and create downstream difficulties in production.

2. Sourcing materials

The next component is sourcing the materials needed for the product or service. This involves identifying suppliers, figuring out how much of the supply to order, keeping track of the supply, and paying the suppliers.

You also want to ensure your supplier meets the regulations needed to continue producing the product and ensure it is safe for the consumer. To keep product prices in the anticipated range, supply chain managers pay attention to any price changes and monitor the pricing of alternative suppliers. 

3. Organising manufacturers

The next step is to find the proper manufacturer for your product. This organisation, company, or person turns the raw materials into the end product.

Supply chain managers arrange quality testing to ensure each product meets the expected standard, potentially from an outside organisation. The manufacturer is responsible for packaging the products and handing them to the delivery service. It’s essential to manage communications between material sourcing, manufacturing, and delivery in this space. These three components need an established flow to keep production moving.

4. Delivery of the product

Supply chain logistics are an essential consideration in the delivery stage. Whether you deliver to retailers or customers’ homes, the delivery service must be reliable and effective. Damaged products, delayed delivery, or incorrect orders can damage the company's reputation and cause customer churn.

5. Managing return services

If a customer is unhappy with the product or would like to exchange it for an alternate one, it is essential to have an effective and convenient return service. This reduces product waste as other customers can receive the returned items.

Supply chain management jobs

The modern supply chain is a complex system composed of countless interconnected parts. To ensure it all goes off without a hitch, management professionals worldwide perform various logistics, planning, and buying duties. Some common jobs you can expect to encounter as you explore a career in the field include: 

• Supply chain manager 

• Logistics manager

• Materials manager

• Sourcing manager

• Master planner 

• Master scheduler

Supply chain management salary

According to Glassdoor, the average annual salary for a supply chain manager in India is ₹13,00,000 annually [1]. As a senior supply chain manager, you can earn approximately ₹22,00,000 annually [2]. Pune, Noida, Hyderabad, and Bengaluru are among India's top-paying cities for supply chain managers [3].  

Supply chain management responsibilities

Supply chain managers have diverse responsibilities and a wide range of job duties. Whilst the exact job description will vary depending on the company and type of industry in which you work, key elements of a supply chain manager career typically include:

• Continually integrating new information and data into your company’s supply chain processes.

• Managing communication between supply chain sectors

• Protecting and managing supply chain data

• Reducing human error with strategic planning

• Planning for future obstacles and developing creating solutions

• Provide accurate information to company employees

• Reducing supply chain costs and maximising revenue

• Simplifying the supply chain as able

• Integrating new technologies into supply chain functions

In essence, a supply chain manager oversees all facets of the supply chain process, including the procurement of raw materials, their distribution across business units, the manufacturing of goods, and the timely delivery of finished products to customers.

Supply chain management software

Supply chain managers use many types of software to manage different supply chain components and keep things running smoothly. In this career, you have the exciting task of finding new and useful technologies to help the company expand. As the product, market, or company grows, you can integrate more advanced software systems to keep track of large volumes of data. Building your technical skills can help you build the knowledge base to manage large projects and add value to your company team.

One such platform is the Automatic Requisition Tracking Management Information System (ARTMIS). Developed by IBM and Chemonics, ARTMIS helps track shipments throughout the supply chain. It also allows supply chain managers to schedule shipments up to two years in advance and promotes long-term coordination of the supply chain elements. 

Another growing case of use in supply chain management is integrating artificial intelligence (AI) and machine learning. Platforms like BASF use these concepts to help supply chain managers make informed decisions, improve current systems, and track progress. 

As your experience in supply chain management expands, you’ll quickly learn to use your creative and problem-solving skills to design innovative supply chain systems that use new technologies to improve function and efficiency. This creative thinking process helps you stay ahead of the competition and keep your organisation at the top of the market.

Get started on your career.

The need for supply chain management professionals grows even more as the world becomes more interconnected. If you're interested in a career in supply chain management, consider taking an online specialisation through Coursera to gain job-relevant skills today.

In Rutgers Supply Chain Management Specialisation on Coursera, you'll have the opportunity to master the fundamentals of the profession, including logistics, operations, planning, sourcing, and strategy. By completing the programme, you'll have a certificate to put on your resume, job-relevant skills, and a richer understanding of the complexities companies face in today's global networked economy.