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What is SCM and Why is it Important?

Larry Simcox
Sr. Director

The acronym SCM stands for supply chain management. It refers to the systems, processes and software packages used by organizations to manage day-to-day operating activities such as, new product development, demand, supply and sales & operations planning, procurement, logistics, order management, manufacturing and asset maintenance. SCM systems provide a strategic advantage and business insight to companies and their operations. SCM systems tie together and define a plethora of business processes and enable the flow of information between them – in essence SCM is the new business operating model. By giving an organization end-to-end visibility from developing products to fulfilling orders, through planning and managing inventory, sourcing, manufacturing, and delivery SCM systems provide the competitive advantage for companies to innovate, connect and simplify their business.

Today, SCM systems are critical to businesses of all sizes and in all industries for managing their day to day operations. To these businesses, SCM is as indispensable as the water we drink to survive.

SCM Fundamentals

SCM systems are designed help a company innovate, connect and simplify their operations while supporting financial, HCM and customer service systems. It’s the glue that ties them all together and provides the operations teams clear direction to execute. SCM systems deliver the visibility, insights, and capabilities you need to create your own intelligent supply chain.

Innovate: Competing in today’s volatile markets requires speed, flexibility, and versatility. Supply chain teams must be able to design, order, plan, source, make, and deliver new products and services quickly and efficiently. Business innovation is increasingly dependent on the application of information technology. Savvy customers are conditioned to expect steady improvements and progressively higher service levels. To keep discerning customers satisfied, companies need control and visibility over every facet of the supply chain.

Connect: Building a modern supply chain begins with solid connections among applications, information systems, and business processes. For many years, the Holy Grail for forward looking companies has been to establish a complete end-to-end process with a single, consolidated real-time version of the truth that spans the entire supply chain. Today, thanks to modern technology enablers like the cloud and advanced analytics, this level of cohesiveness and efficiency can finally be realized.

Simplify: Of course, today’s business leaders are challenged to build infrastructures that meet 24/7 business demands while remaining within the limitations set for them. They need a simple IT infrastructure that lowers costs, streamlines data management exercises, and provides the performance necessary for real-time decision making. The consumerization of technology has raised the bar for all SCM vendors. Users expect simple processes and applications that they can use to run their businesses. In short, they are looking for a new standard for supply chain innovation, connectivity, and simplicity.


The Supply Chain Management Evolution

Oracle offers a broad range of end-to-end, integrated SCM solutions to help customers modernize operations across the demand, supply, and product areas of their businesses. Underlying the SCM portfolio are analytical capabilities that span applications, modules, and functions. This unique family of solutions falls into the following areas:

  • Oracle product lifecycle management (PLM) solutions can connect your entire organization by establishing a single source of truth for product information and processes. Oracle’s PLM solutions enable companies to rapidly innovate, develop, and commercialize new products.
  • Oracle’s supply chain planning technology enables your staff to make fast and accurate planning decisions. It addresses demand management, supply and distribution planning, promotions planning, and service and maintenance planning.
  • Oracle’s procurement solutions allow you to improve negotiations, make smarter spending decisions, and more effectively manage source-to-settle processes.
  • Oracle logistics capabilities include transportation planning, informed trade decisions, and efficient warehouse operations. From fleet management to transportation intelligence, freight payments to carrier sourcing, Oracle can help you improve your logistics activities.
  • Order management and fulfillment orchestration and processes must span the order-to-cash lifecycle. Oracle supplies a centrally-managed, globally-available platform for order management activities that improves order visibility and expands fulfillment options across multiple channels.
  • Oracle’s manufacturing excellence stems from automation that encompasses the entire production cycle—improving visibility, encouraging collaboration, and mitigating risk for manufacturing operations.
  • Good asset maintenance management is a byproduct of sharing information and updates about all types of assets throughout the asset management lifecycle. Oracle’s support for preventive maintenance gives workers a complete view of all types of assets and equipment.

Get Started Today

In nearly every industry, market leaders recognize the shortcomings of relying on rigid, legacy applications. To advance in competitive markets, they are adopting modern, flexible, end-to-end supply chain solutions. Cloud security has steadily improved even as the economics of implementing cloud applications have become more compelling, motivating organizations to move their SCM applications to the cloud. Rather than continuing to install, maintain, patch, modify, and integrate a dozen different SCM applications, they are adopting cloud-based alternatives that can be provisioned, deployed, integrated, and scaled—quickly and easily.

Of course, not all SCM cloud vendors are created equal. To stay flexible and innovative, businesses need to connect their processes, empower their people, and simplify their operations and the associated supply chain systems. Oracle is uniquely positioned to provide a broad family of solutions that does just that. These proven, cloud-based SCM solutions enable you to quickly and securely deploy new services and capabilities that can be easily scaled to meet ongoing demand.

Oracle SCM Cloud enables you to innovate quickly and execute rapidly as you scale to meet customer demand. Join the many forward-looking companies that have deployed Oracle supply chain management applications with minimal risk to achieve maximum flexibility. With Oracle SCM Cloud solutions, these companies no longer have to maintain on-premises infrastructure or stay on top of upgrades. They can receive Oracle’s latest, best-in-class SCM functionality through a flexible subscription-based pricing model. Please visit oracle.com/scm for details

You may also find these past articles interesting:

5 Strategies for Better Supply Chain Management in the Current Economy 

Market Study: The Future of SCM in the Cloud


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