Essential of Supply Chain Management

Essentials of Supply Chain
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Essentials of Supply Chain
Globalization, technological change, and cutthroat market competition have influenced the approach to supply chain operations. Nowadays, companies cooperate to contribute mutual benefits, focusing on particular activities and trying to perform it at their best. The companies successfully use the outsourcing service of logistics companies. Instead of dissipating energy, companies can bring to perfection a core competency and stay competitive in a rapidly changing environment (Chopra &Meindle, 2016, p. 11).
The new business approach implies virtual integration instead of vertical integration: a company takes its position in a supply chain and collaborates with other companies that complete an entire integrated net. From a financial perspective, this new approach contributes to generation of costs and benefits that intertwine in an efficiently functioning steady system. A company identifies specific benefits and makes estimates of their dollar value (Hugos, 2018, p.21).
The new system provides four types of benefits. Direct benefits — the increasing capacity leads to an increase in productivity and cost savings. Also, the new system brings labor saving and growth of productivity (Hugos, 2018, p.285). Inc…