(KMBN OM01) Unit 1: Supply Chain Concepts

Supply chain refers to the entire process of producing and delivering a product or service to the end customer. It's like a network that connects different people and businesses involved in making a product, starting from getting the raw materials to delivering the final product to consumers.

Example:

1. Raw Materials: Imagine you want to buy a T-shirt. The first step is getting cotton (the raw material) from a farm.
2. Manufacturer: The cotton is sent to a factory where it's turned into fabric, and then stitched into T-shirts.
3. Wholesaler: The finished T-shirts are sold in bulk to a wholesaler, who buys a large quantity from the factory.
4. Retailer: The wholesaler then sells the T-shirts to a retail store, where you as a customer can buy one.
5. Delivery: Once you buy the T-shirt, it's packed and delivered to your home if you bought it online.

Each step in this process involves different players, all working together to get the T-shirt from the farm to your closet. This entire journey is called the "supply chain."

In short, the supply chain is like a series of steps or links that ensure a product is made and reaches the customer.

Objectives of a Supply Chain

The objectives of a supply chain are the goals or purposes that companies aim to achieve in the process of moving products from their starting point (raw materials) to the end point (customers). These objectives ensure that the supply chain runs smoothly, efficiently, and benefits everyone involved. Here's a simple explanation with examples:

• Deliver Products on Time: The main goal is to get the product to the customer when they need it. Imagine ordering a pizza. The supply chain ensures that the ingredients are available, the pizza is made, and it gets delivered to your home on time. If it's late, the customer isn't happy!
• Keep Costs Low: Companies try to minimize costs in the supply chain, like transportation and storage. For example, a car company would want to make sure that they’re not spending too much on shipping parts from suppliers. If they do, the cost of the car would go up for the customer.
• Ensure Product Quality: The supply chain should make sure that the products are high quality. If you order a smartphone, you expect it to work perfectly when it arrives. This means the supply chain—from the materials, to manufacturing, to delivery—must ensure quality at every step.
• Be Flexible: Sometimes, things don’t go as planned. For example, during a holiday sale, a store might sell more toys than expected. The supply chain should be able to quickly get more toys to the store to meet the higher demand.
• Customer Satisfaction: In the end, the goal is to make the customer happy. Whether it’s the right product, delivered on time, at a good price, the supply chain works to ensure that customers are satisfied with their purchase.

Example: Think of ordering a laptop online: 

• The manufacturer needs to have all the parts ready (objective: product availability).
• The laptop should be assembled at a reasonable cost so it’s not too expensive for you (objective: keep costs low).
• It should be delivered to you without damage (objective: ensure quality).
• If there’s a sudden increase in orders, the company should be able to handle it (objective: be flexible).
• Finally, you should receive it on time and be happy with the product (objective: customer satisfaction).

These are the main goals or objectives that companies try to achieve through their supply chain, ensuring everything runs efficiently and customers get what they want, when they want it.

Stages of a Supply Chain

The stages of a supply chain are the different steps that a product goes through, from the beginning (raw materials) to the end (reaching the customer). Here’s a simple breakdown using an example of making and delivering a chocolate bar:

1. Suppliers (Raw Materials): This is the starting point, where the raw materials are sourced. For a chocolate bar, raw materials like cocoa beans, sugar, and milk are collected from farms and suppliers. Example: Farmers harvest cocoa beans and sell them to a chocolate manufacturer.

2. Manufacturing: In this stage, the raw materials are turned into the final product. The chocolate factory processes the cocoa, mixes it with other ingredients, and makes the chocolate bars. Example: The factory produces, molds, and packages the chocolate bars.

3. Wholesaler/Distributor: The manufactured chocolate bars are then sold in bulk to wholesalers or distributors, who help move the product from the factory to the stores. Example: A distributor buys thousands of chocolate bars from the factory and delivers them to grocery stores.

4. Retailer: Next, retailers (like supermarkets or local shops) buy the product from distributors and sell it to the end customer. Example: The grocery store stocks the chocolate bars on their shelves for customers to buy.

5. Customer: This is the final stage, where the customer buys and consumes the product. Example: You go to the store, buy a chocolate bar, and enjoy it.

Value chain Process

The value chain process refers to all the activities a company does to add value to a product or service at each step, making it more valuable to the customer. It's about improving the product from start to finish, so that by the time it reaches the customer, it’s better and worth more than just the raw materials.

Let’s break it down with an example of making a smartphone:

1. Inbound Logistics (Getting Materials): This is about receiving and storing the raw materials or components needed to make the product. Example: The smartphone company gets parts like screens, batteries, and chips from different suppliers.

2. Operations (Making the Product): Here, the raw materials are turned into the final product. This step includes assembling the smartphone. Example: Workers in a factory assemble the phone using the different parts. This is where the product starts taking shape.

3. Outbound Logistics (Delivering the Product): Once the product is ready, it's sent to the market or stores where customers can buy it. Example: The finished smartphones are packaged and sent to electronics stores or online retailers.

4. Marketing and Sales (Promoting the Product): In this step, the company promotes and sells the product to customers, creating awareness and convincing people to buy it. Example: The company runs ads, creates social media posts, and offers discounts to make people interested in buying their smartphone.

5. Service (After-Sale Support): After the customer buys the product, the company provides support, like customer service, warranties, or repairs. Example: If your smartphone has an issue, the company might offer a repair service or a warranty to fix it for free.

Supporting Activities:

These help the main activities but aren’t directly involved in making the product:

• Technology Development: Improving the tech used in the smartphone.
• Human Resource Management: Hiring and training employees.
• Procurement: Buying the right parts and materials at a good price.

Example Summary: For a smartphone: 

• The company gets parts (Inbound Logistics).
• They assemble the phone (Operations).
• The phone is shipped to stores (Outbound Logistics).
• They advertise it (Marketing).
• They provide customer support after you buy it (Service).

The value chain process ensures that at each stage, value is added to the product, making it more valuable when it reaches the customer.

Cycle view of Supply Chain Process

The cycle view of the supply chain divides the entire supply chain into different cycles, each handled between two parties (like a supplier and a manufacturer). Each cycle focuses on a specific part of the process, making it easier to understand how products move step by step from raw materials to customers.

Let’s break it down with an example of buying a bicycle

1. Procurement Cycle (Ordering Raw Materials): This is the cycle where the company orders the raw materials needed to make the product. Example: The bicycle company orders metal, rubber, and other parts (like gears and brakes) from its suppliers. Parties Involved: Supplier and Manufacturer.
2. Manufacturing Cycle (Making the Product): In this cycle, the raw materials are used to create the final product. Example: The bicycle company uses the metal to build the bike frame, attaches the wheels, and assembles all the parts. Parties Involved: Manufacturer and Internal Teams.
3. Replenishment Cycle (Restocking the Product): Once the bicycles are made, they need to be sent to stores. This is where the manufacturer restocks or sends more products to retailers. Example: The bicycle company ships finished bikes to different retail stores to be sold. Parties Involved: Manufacturer and Retailer.
4. Customer Order Cycle (Delivering to Customers): This is the final stage, where the product is sold to customers. The retailer fulfills customer orders and delivers the product to them. Example: You go to a store or order a bike online, and the store delivers the bike to you. Parties Involved: Retailer and Customer.

In each of these cycles, two parties work together to move the product along the supply chain. The cycle view helps break down the supply chain into simple, manageable steps, focusing on the interactions between different players at each stage.

Key issues in SCM

In Supply Chain Management (SCM), there are several key issues or challenges that businesses often face. These problems can disrupt the smooth flow of products from raw materials to customers. Let’s break down some of the common issues using simple examples:

• Demand Uncertainty: This happens when a company doesn’t know exactly how much product customers will buy. It’s hard to predict demand accurately, which can lead to overstocking or running out of products. Example: A toy company makes a new toy for the holidays, but they’re unsure how many kids will want it. If they make too many toys and demand is low, they lose money. If they make too few and demand is high, they run out of stock, and customers are unhappy.
• Supply Delays: This issue arises when suppliers don’t deliver raw materials or products on time. If one part of the supply chain is delayed, the entire process gets slowed down. Example: A car company is waiting for engines from a supplier, but the delivery is delayed due to bad weather. As a result, they can’t finish making the cars on time, which leads to a delay in delivering cars to customers.
• Inventory Management: Managing inventory is tricky—companies need to balance having enough stock without holding too much. Too much inventory ties up money and space, while too little can lead to stockouts. Example: A clothing store orders too many winter jackets, but if winter ends early, they’ll have excess jackets that are hard to sell, leading to a loss. On the other hand, if they order too few and demand is high, they’ll lose potential sales.
• Supplier Issues: Problems with suppliers can create major disruptions in the supply chain. If a supplier goes out of business, raises prices, or delivers poor-quality materials, it affects the entire production process. Example: A smartphone company relies on one supplier for high-quality screens. If the supplier suddenly increases prices or lowers quality, the smartphone company will struggle to meet customer expectations and may have to increase the price of its phones.
• Globalization and Risk: With global supply chains, companies face risks from different countries, such as political instability, customs delays, or transportation issues. Example: A shoe company sources materials from multiple countries. If one country experiences political unrest or a shipping delay due to port closures, the materials can’t reach the factory, and production slows down.
• Sustainability Concerns: Many companies face pressure to make their supply chains more environmentally friendly. This includes reducing waste, cutting down emissions, or using sustainable materials, which can be costly and complex to implement. Example: A company making plastic bottles is pushed to use recyclable materials, but switching to sustainable packaging costs more and requires new machinery, leading to increased production costs.
• Technology Integration: Technology plays a big role in supply chain efficiency, but integrating new tech (like automation, data tracking, or AI) can be challenging and expensive. Example: A logistics company wants to use software to track packages in real-time, but integrating this new technology requires training employees and upgrading existing systems, which can be difficult and costly.
• Cost Management: Keeping costs under control while maintaining quality and speed is a constant challenge for companies. Rising costs of raw materials, labor, or transportation can eat into profits. Example: A furniture company sees a rise in the cost of wood and fuel for transportation. They either have to raise prices for customers or find ways to cut costs elsewhere, which is tough.

In Short,

• Demand Uncertainty: Hard to predict how much customers will buy.
• Supply Delays: Suppliers may not deliver on time.
• Inventory Management: Balancing stock levels is tricky.
• Supplier Issues: Problems with suppliers can disrupt the chain.
• Global Risks: Global supply chains are vulnerable to risks like delays or political unrest.
• Sustainability: Meeting environmental goals can be costly.
• Technology Integration: New technology is hard and expensive to implement.
• Cost Management: Rising costs can hurt profits.

Each of these issues can create problems in the supply chain, making it harder for companies to efficiently deliver products to customers.

Logistics & Supply Chain Drivers and Obstacles

Logistics and Supply Chain Drivers are the key factors that help a company’s supply chain run smoothly and efficiently, while obstacles are the challenges that can get in the way and make the process harder.

Let’s break this down in simple language with examples.

Supply Chain Drivers:

These are the main things that keep the supply chain moving and successful. There are six main drivers:

• Facilities (Where Things Are Made and Stored): This includes factories, warehouses, and stores where products are made, stored, or sold. Example: A shoe company has a factory where shoes are made and a warehouse where finished shoes are stored before being sent to stores.
• Inventory (Stock of Products): This is about managing how much stock you have. Too much or too little inventory can cause problems. Example: A bookstore needs to keep enough popular books in stock to meet customer demand but not so many that they have too many unsold copies.
• Transportation (Moving Products): This driver focuses on how products are transported from one place to another, like from a factory to a store. Example: A furniture company uses trucks to move tables and chairs from the factory to retail stores.
• Information (Data Sharing): Information is crucial for knowing where products are, how much stock is left, and what the customer wants. Sharing this information between suppliers, manufacturers, and stores is key to making good decisions. Example: An online retailer uses real-time data to see how many customers are ordering a particular product and tells the warehouse to prepare for more shipping.
• Sourcing (Choosing Suppliers): This driver is about choosing the right suppliers for raw materials or parts. A good supplier can deliver quality materials on time and at a good price. Example: A phone company chooses a reliable supplier for screens because getting the screens on time and at a good price keeps production going smoothly.
• Pricing (Cost to Customers): Pricing refers to the cost of products and how pricing strategies influence customer buying behavior and how much inventory to hold. Example: During a sale, a clothing brand lowers prices to clear out last season’s stock, encouraging customers to buy more.

Supply Chain Obstacles:

These are the problems or challenges that make managing the supply chain difficult:

• Demand Variability (Unpredictable Demand): When customer demand is unpredictable, it can be hard to manage stock levels or keep the supply chain running efficiently. Example: A toy company sees a huge demand spike for a new toy at Christmas but can’t keep up because they didn’t know it would be so popular.
• Supplier Problems (Issues with Suppliers): If suppliers are unreliable, deliver poor-quality materials, or don’t meet deadlines, the whole supply chain gets disrupted. Example: A bakery relies on a supplier for flour, but if the supplier delivers low-quality flour, it affects the quality of the bakery’s products.
• Transportation Delays (Shipping Problems): Transportation issues like traffic, bad weather, or accidents can cause delays in getting products to stores or customers. Example: A car company faces delays because trucks carrying car parts are stuck in traffic or face road closures.
• Global Risks (International Issues): For companies with global supply chains, risks like political instability, trade tariffs, or natural disasters in different countries can cause big disruptions. Example: A laptop company sources parts from multiple countries. If one country experiences a political conflict, it can delay the supply of essential parts.
• Cost Fluctuations (Rising Costs): When the cost of raw materials, labor, or transportation rises suddenly, it can be difficult for companies to keep costs under control. Example: A restaurant faces rising food costs due to drought affecting crop production, making ingredients more expensive.
• Technology Issues (Problems with Tech Integration): Sometimes, integrating new technologies (like tracking software or automation) can be costly or difficult, slowing down the supply chain. Example: A logistics company invests in new tracking software to monitor shipments, but employees struggle to adapt to the new system, causing delays.

Example:

Let’s say a clothing company is making T-shirts:

• Facilities: The company has factories and warehouses where T-shirts are made and stored.
• Inventory: They need to balance how many T-shirts they make to meet customer demand without overproducing.
• Transportation: Trucks deliver the T-shirts to stores and online customers.
• Information: The company tracks which sizes and colors are selling best to adjust their production.
• Sourcing: They choose reliable fabric suppliers to ensure the T-shirts are made on time.
• Pricing: The company may lower prices during a clearance sale to attract more customers.

Obstacles they might face:

• Demand for T-shirts may be unpredictable (demand variability).
• A supplier may fail to deliver enough fabric on time (supplier problems).
• A transportation delay might cause some stores to run out of stock (shipping problems).
• If shipping costs rise, it could cut into their profits (cost fluctuations).

Supply chain strategies 

Supply chain strategies are the different approaches that businesses use to manage the movement of goods from raw materials to the customer. These strategies help companies balance cost, speed, quality, and flexibility depending on their goals and market needs.

Here’s a simple explanation of the main supply chain strategies with examples:

• Lean Strategy (Focus on Efficiency): The lean strategy is all about reducing waste, cutting costs, and being as efficient as possible. The goal is to produce just what is needed, when it's needed, to avoid overproduction and excess inventory. Example: A car manufacturer uses a lean strategy by producing cars only when there is demand for them, instead of keeping a large inventory of unsold cars. This saves space and reduces costs.
• Agile Strategy (Focus on Flexibility): The agile strategy focuses on being flexible and responsive to changes in customer demand or market conditions. Companies using this strategy are quick to adjust to trends, new technologies, or customer preferences. Example: A fashion brand uses an agile strategy by quickly changing its clothing designs based on current trends. They can adapt their supply chain to produce new styles within a few weeks to meet customer demands.
• Push Strategy (Make Products in Advance): In a push strategy, products are made in advance based on forecasts of customer demand. This means companies "push" products through the supply chain, hoping that customers will buy them. Example: A smartphone company produces a large number of phones before a new model is released, expecting high demand. They distribute these phones to stores ahead of time, hoping customers will buy them once the phone is launched.
• Pull Strategy (Produce Based on Actual Demand): In a pull strategy, products are made only when there is actual demand from customers. This helps avoid overproduction and excess inventory, but it can take longer for customers to receive their products. Example: A furniture company waits for a customer to order a specific table, and then they start producing it. This way, they don’t waste materials or space by making tables that no one wants.
• Hybrid Strategy (Combination of Push and Pull): A hybrid strategy combines elements of both the push and pull strategies. Companies might produce some products in advance (push) and then customize them or finish production when customer orders come in (pull). Example: A laptop company produces basic models in advance but waits for customer orders to add specific features (like extra memory or a custom color), tailoring the final product to customer preferences.
• Global Strategy (Use of International Suppliers): With a global strategy, companies source materials, manufacture, and sell their products internationally. This helps businesses reduce costs by finding cheaper labor or materials in other countries, but it also introduces risks like transportation delays or political issues. Example: A shoe company designs its products in the U.S., manufactures them in Vietnam (where labor costs are lower), and sells them worldwide. While this saves money, the company has to carefully manage its supply chain to avoid delays.
• Responsive Strategy (Quick Delivery and Adaptation): The responsive strategy focuses on delivering products quickly to customers, especially when demand is unpredictable. It’s about having the ability to respond fast to customer needs and market changes. Example: An e-commerce company, like Amazon, uses a responsive strategy by having products in regional warehouses so they can deliver items to customers within one or two days, based on fast-changing customer demand.

Example: Imagine a toy company:

• If they use a lean strategy, they only produce toys when there is a confirmed order to avoid making too many.
• If they follow an agile strategy, they change their toy designs quickly to match the latest trends in children's toys.
• With a push strategy, they make a large number of toys in advance before the holiday season, expecting high demand.
• Using a pull strategy, they wait for customers to place orders for toys before making them.
• A hybrid strategy means they pre-produce basic toy models but customize colors or features after a customer places an order.
• If the company adopts a global strategy, they might manufacture toys in a country where labor is cheaper but sell them worldwide.
• With a responsive strategy, they keep popular toys in nearby warehouses to quickly ship them to customers when they order.

Each of these strategies helps the company manage costs, speed, and customer demand in different ways, depending on the market and their goals.

Strategic fit

Strategic fit refers to how well a company's supply chain and operations align with its overall business strategy and goals. In simpler terms, it’s about making sure that all parts of the business work together effectively to meet the company’s objectives.

Why It Matters:

When a company has strategic fit, it can operate more efficiently, meet customer needs better, and ultimately achieve its goals more effectively. If there’s a mismatch, it can lead to wasted resources, unhappy customers, and lost profits.

Example of Strategic Fit: Let’s consider a luxury watch company versus a budget watch company:

1. Luxury Watch Company: 

• Business Strategy: Focus on high-quality, exclusive watches with premium pricing.

Supply Chain Approach:

• Low Volume, High Variety: Produces a limited number of unique designs.
• Emphasis on Quality: Uses the best materials and craftsmanship.
• Longer Lead Times: Takes time to produce each watch to ensure quality.

Strategic Fit: The supply chain supports the business strategy by ensuring that only the highest-quality materials are used, and the production process is meticulous. Customers expect high quality and are willing to wait, so the longer production time fits perfectly with the luxury brand image.

2. Budget Watch Company:

• Business Strategy: Focus on affordability and high volume to attract cost-conscious consumers.

Supply Chain Approach:

• High Volume, Low Variety: Produces large quantities of a few basic designs.
• Cost Efficiency: Focuses on minimizing production costs and speeding up production.
• Quick Turnaround: Aims to get products to market quickly.

Strategic Fit: The supply chain is designed to produce watches quickly and at low costs, allowing the company to sell at competitive prices. This aligns perfectly with their business strategy of providing affordable watches to a wide market.

Summary of Strategic Fit:

• Luxury Watch Company: High quality, longer production times, and low volume align with their strategy of exclusivity and premium pricing.
• Budget Watch Company: Low cost, quick production, and high volume align with their strategy of offering affordable products.

In Short,  Strategic fit is essential for businesses to ensure that their operations, supply chain, and overall strategies work harmoniously together. When a company achieves strategic fit, it can better serve its customers, improve efficiency, and reach its goals.

Best practices in Supply Chain Management (SCM

Best practices in Supply Chain Management (SCM) are effective strategies and approaches that companies use to improve their supply chain operations. These practices help businesses minimize costs, improve efficiency, and enhance customer satisfaction. Let’s break down some of these best practices with simple explanations and examples:

• Clear Communication: Maintaining open and clear communication among all parties in the supply chain—suppliers, manufacturers, distributors, and retailers—is crucial. Example: A toy manufacturer regularly updates its suppliers about production schedules and any changes in demand. This helps suppliers prepare and deliver materials on time, ensuring the toys are produced without delays.
• Inventory Management: Efficient inventory management means keeping the right amount of stock on hand to meet customer demand without overstocking. Example: A grocery store uses an inventory management system that tracks which items sell quickly (like fresh produce) and which items take longer to sell (like canned goods). This helps them order just the right amount of products to reduce waste and ensure shelves are stocked.
• Demand Forecasting: Accurately predicting customer demand helps companies plan their production and inventory levels more effectively. Example: A clothing retailer analyzes past sales data and market trends to forecast how many winter coats they need. This ensures they produce enough coats to meet demand without ending up with unsold inventory after the season.
• Supplier Collaboration: Working closely with suppliers to build strong relationships can lead to better quality materials, lower costs, and timely deliveries. Example: A car manufacturer collaborates with its parts suppliers to design better components that reduce production costs. This partnership results in higher-quality parts and a smoother production process.
• Technology Integration: Using technology, such as data analytics, automation, and tracking systems, helps streamline supply chain processes. Example: An online retailer uses tracking software to monitor shipments in real-time. This allows them to provide customers with accurate delivery updates and resolve any shipping issues quickly.
• Lean Practices: Implementing lean practices involves eliminating waste and inefficiencies from the supply chain to improve productivity. Example: A food processing company adopts lean practices by reorganizing its production line to reduce unnecessary steps. This leads to faster production times and lower operational costs.
• Sustainability Initiatives: Incorporating sustainable practices in the supply chain can help reduce environmental impact and appeal to environmentally conscious consumers. Example: A beverage company uses recyclable packaging and sources ingredients from sustainable farms. This not only helps the environment but also attracts customers who care about sustainability.
• Continuous Improvement: Constantly evaluating and improving supply chain processes ensures that companies remain competitive and can adapt to changing market conditions. Example: A logistics company regularly reviews its delivery routes and methods. By analyzing data, they find more efficient routes that save time and fuel, leading to lower costs and improved service.

In Short, 

• Clear Communication: Keep all parties informed.
• Inventory Management: Balance stock levels to meet demand.
• Demand Forecasting: Predict customer needs accurately.
• Supplier Collaboration: Build strong relationships with suppliers.
• Technology Integration: Use tech for efficiency and tracking.
• Lean Practices: Eliminate waste in production.
• Sustainability Initiatives: Incorporate eco-friendly practices.
• Continuous Improvement: Regularly evaluate and enhance processes.

Implementing these best practices in SCM can significantly enhance a company's efficiency, reduce costs, and improve customer satisfaction. By following these approaches, businesses can create a more effective and responsive supply chain.

Obstacles of streamlined SCM

Streamlined Supply Chain Management (SCM) is all about making the process of getting products from manufacturers to consumers as smooth and efficient as possible. However, there are several obstacles that can make this difficult. Here are some common ones explained in simple terms, along with examples:

• Communication Gaps: If different parts of the supply chain (like suppliers, manufacturers, and retailers) don’t communicate well, it can lead to confusion. Example: Imagine a bakery that orders flour from a supplier. If the supplier doesn’t inform the bakery about a delay in delivery, the bakery might run out of flour and be unable to make bread for customers.
• Demand Fluctuations: Changes in customer demand can make it hard to plan. If a company makes too much of a product that no one wants, or too little of a popular item, it can cause problems. Example: Think of a toy company that produces a popular toy for the holiday season. If they guess wrong and make too few, they miss out on sales. If they make too many, they end up with unsold toys after the holidays.
• Inefficient Processes: If the steps in the supply chain are not organized well, it can slow everything down and increase costs. Example: A clothing manufacturer that has a complicated process for getting materials might spend too much time and money. If they have to wait for supplies to arrive from different places, it can delay production.
• Technology Issues: Using outdated or incompatible technology can hinder the flow of information and products. Example: If a warehouse uses an old inventory system that can’t communicate with the online store, it may lead to mistakes in stock levels, resulting in either too much or too little inventory.
• Transportation Problems: Delays or disruptions in transportation can prevent products from reaching their destination on time. Example: If a truck carrying fresh produce gets stuck in traffic or has a breakdown, the grocery store may not receive its delivery, leading to empty shelves.
• Supplier Reliability: If a supplier has quality issues or can’t deliver on time, it can disrupt the entire supply chain. Example: If a car manufacturer relies on a single supplier for a critical part and that supplier fails to deliver, it could halt the entire production line, delaying car deliveries to customers.
• Regulatory Compliance: Companies must comply with laws and regulations, which can add complexity to supply chain processes. Example: If a company is exporting goods, it has to follow customs regulations. If they don’t understand these rules, their shipments could be delayed or fined.

Understanding these obstacles can help companies find ways to improve their supply chain processes, making them more efficient and effective.

KMBN-OM02-Unit-1-Introduction of Operation Planning & Control