SAP SCM represents Supply Chain Management. And it is one of the most significant modules of SAP. It tents the area of business forecasting, demand planning and production planning. It controls information flow and product flow in the organization. It is integrated with other business process such as material purchase process, development process, product discovery, etc. It gives maximum satisfaction to their customers at less cost.
Following of the components of SCM –
1. SC Plannig – It generates plan on the basis of current and relevant data.
2. SC Collaboration – It make joint forecasts and agreements.
3. SC Coordination – Synchronize through the exchange data and information between departments.
4. SC Execution – Make sure that plans are greatly executed to fulfill customers requirement’s.
SAP SCM is divided into 3 types of flow, those are
1. Product Flow – It includes delivery of goods and services from suppliers to customers and returning any goods or services from customers.
2. Information Flow – It includes the delivering of information that related to the orders and updating the delivery status.
3. Finance Flow – It contains the financial accounting.
2 types of SCM, those are
1. Execution Application – It used to track the status of materials, financial data and services.
2. Planning Application – It is used to process the orders by using advanced algorithms.
Benefits of SCM –
1. Improved collaboration and better management of multiple lines of business.
2. Competent forecasting and handling of sudden changes in demand and supply.
3. Central management and optimization of Inventory, order fulfillment and shipping.
4. Real - time decision making for early execution across the supply chain.