Supply Chain Management
Inventory management, order processing, procurement, and logistics.
Workflow
- 01Supplier Management
- 02Purchase Ordering
- 03Goods Receiving
- 04Inventory Control
- 05Order Fulfilment
- 06Logistics Management
If you change this
It implies 2 topics across 2 modules, including Manufacturing which you might not expect.
See the path ahead →Why it matters
Supply chain decisions become financial outcomes with a delay. Stock bought today is working capital now and obsolescence later; a supplier chosen on price is a service failure two quarters out.
- It ties up working capital: Inventory is cash that has already been spent and not yet earned.
- It determines the customer promise: Availability is what makes a delivery date real.
- It carries concentration risk: Single-source dependency is invisible until it is not.
The workflow
- 01
Supplier management
Suppliers qualified, contracted and measured against what was agreed.
- 02
Purchase ordering
Demand converted to commitment, priced from contract rather than memory.
- 03
Goods receiving
What arrived recorded accurately and promptly — the evidence payables depends on.
- 04
Inventory control
Stock counted, valued, located and aged, with accuracy verified rather than assumed.
- 05
Order fulfilment
Customer demand met from available stock or capacity, allocated by policy.
- 06
Logistics management
Movement planned, executed and tracked through to proof of delivery.
Stock accuracy is the constraint on everything else. Planning, promising and fulfilment all consume the same number, and if it is wrong they are all wrong in the same direction.
What you need in place
- Accurate stock on hand: With cycle counting to prove it, not an annual stocktake to correct it.
- Contracted pricing as data: So orders price themselves.
- Receipting discipline: Prompt and accurate, because payables and stock both depend on it.
- Allocation policy: Who gets constrained stock, decided in advance.
- Supplier performance measurement: On-time and in-full, measured rather than felt.
- Landed cost: Freight, duty and handling in the inventory value, or margin is overstated.
Questions to ask
01Stock accuracy
What is our count accuracy, measured by cycle count?
Everything downstream inherits this number.
02Working capital
How much cash is in stock, and how old is it?
Ageing is where obsolescence hides.
03Concentration
Which items have a single supplier?
Name them before you need to.
04Receipting
How quickly are receipts recorded?
Lag here blocks invoices and misstates stock.
05Landed cost
Are freight and duty in the inventory value?
If not, reported margin is wrong.
06Allocation
Who decides when there is not enough?
Policy, or whoever escalates loudest.
Metrics and KPIs to track
Inventory accuracy
Cycle count variance by value and by line.
Stock turns
By category, against target.
Inventory ageing
Value by age band, and obsolescence provision.
Supplier on-time in-full
By supplier, against contract.
Fill rate
Demand met from available stock.
Receipting lag
Delivery to receipt recorded.
Covers