Basics of Supply Chain Management

Supply chain management (SCM) is something that everyone seems to be talking about these days. Of course, supply chain management is far more than a buzzword. It’s a vital practice that keeps virtually everything around the world moving. It’s an enormous market, worth more than $1.3 trillion, with plenty of opportunities for growth and advancement. This has led many people to ask how they can begin careers in the field of logistics and supply chain management.

For many, the concept of the supply chain is nebulous at best. Despite how the supply chain touches practically everything around us, you’d be hard-pressed to find a straight answer from someone on how it is defined.

Here’s a brass tacks explanation of supply chain management, what it is, what it does, and how you can break into this rapidly expanding field.

What is Supply Chain Management?

The Association for Supply Chain Management (ASCM) defines supply chain management as the planning and execution of supply-chain activities. This is done with the end goal of creating value and infrastructure while measuring performance across the globe.

At its core, supply chain management is the organization and oversight of the flow of goods between businesses and consumers. These operations may include the storing and shipping of inventory or materials, oversight of daily operations, the logistics behind these processes, and the integration of these varying elements across the supply chain.

Understanding the Key Components of Supply Chain Management

How do we distill the concept of supply chain management down to its essentials? It starts with a better understanding of four of the key elements of supply chain management. Once we pinpoint what those elements are, and how they function, we are that much closer to a fundamental understanding of the basics of supply chain management itself.


The first, and arguably most important, aspect of supply chain management is right there in the name. Without goods to transport and track, there’s little need for a chain to manage it. This element of supply chain management incorporates the purchasing of raw materials as well as manufactured goods for distribution.

The fundamental nature of supply goes beyond the goods themselves. It may also cover the purchase of supplies and equipment a business needs to make its supply chain function properly. Choosing the right suppliers and ensuring that they align smoothly with the other links in the supply chain is one of the first steps in successful SCM.


Optimizing the day-to-day operations of your business is a key aspect of supply chain management. A supply chain is only as good as the people that keep it running. It is crucial that you maximize the effectiveness of your company’s operations. In doing so, you can ensure that inventory and order management run smoothly to better serve the rest of the chain.

Many moving parts make up the supply chain. It is imperative that supply chain managers pay close attention when monitoring these different processes. This allows them to discover where things are working, and where there may be room for improvement.


Some people believe that logistics and supply chain management are synonymous. This is a common misconception. However, one thing that people agree on is that logistics are a core component of supply chain management and the success of a business.

Specifically, logistics are the part of SCM that specifically deals with the flow and storage of goods. Essentially, logistics is a big part of what makes up the muscle behind supply chain management as we know it. While supply chain management as a whole is focused on maintaining a competitive leg up for your business, logistics focuses more specifically on your customers. Through the application of sound logistics, supply chain managers keep their customers happy, which directly leads to standing out against the competition.


Integration makes up the beating heart of the supply chain. Ensuring effective communication between the different links of the supply chain is essential to any supply chain management enterprise.

Through the application of the latest software and services, companies are managing and upgrading their supply chains faster than ever before. Supply chain software tools and reporting applications give businesses the power to exert more control over their supply chains. This is all done while receiving detailed analysis to keep customers up-to-date while also determining their own benchmarks for success.

How Do I Enter the Supply Chain Management Industry?

Armed with an understanding of the basics of supply chain management, you may find yourself emboldened to start your path to an SCM career. Still, you should also be aware of the essential parts of the job and what you’ll be doing.

Data and Analytics Keep the Supply Chain Moving

Like just about everything these days, much of supply chain management is about data. Data drives so many of our decisions, and SCM is no different. Through the application of analytics on supply chain operations, managers can better understand every aspect of their business, every step of the way. If you want a career in supply chain management, having an eye for numbers is a big advantage.

SCM is a Competitive Market

It should come as no surprise that supply chain management is a competitive marketplace. After all, it’s a market worth over $1 trillion. If you hope to stand out in the supply chain industry, you need to be the best. There is no shortage of companies vying for the same business. That is why it’s all the more important that people in the industry are prepared to give it their all.

There’s Never a Dull Moment

In an industry that traverses the globe and stretches across borders and time zones, supply chain management never stops moving. You could be securing deals locally or ensuring shipments from overseas. Whatever the case, you never know what your job is going to throw at you next. You need to be quick on your feet and ready for anything because the unexpected can, and probably will, happen.

A Growth Opportunity in an Expanding Market

At the rate the industry is growing, the sky is the limit when it comes to a career in supply chain management. There is no shortage of opportunities, and these chances keep multiplying along with the industry. It’s an excellent time to sink your teeth into the supply chain management market. The real question is if you’re hungry.

See How to Start Your Supply Chain Career

By now, you should have at least a casual grasp on the basics of supply chain management. The next question will be what you choose to do with this knowledge. It may seem as though a supply chain management business is a massive undertaking requiring a huge office and tons of equipment. The truth is, thanks to modern technology, you can start your own logistics franchise and run it from the comfort of your home. Don’t wait for your ship to set sail when it comes to capitalizing on a supply chain management career. Take your future into your own hands, and see how you can start your SCM franchise today.