Managing the Financial Supply Chain - Part 1
Supply Chain Management Review has an article titled - Managing the Financial Supply Chain by Roland Hartley-Urquhart in a recent edition of their online magazine.
Understanding and managing all aspects of the financial supply chain is an essential ingredient for business success. While that statement has always been true, it takes on a new level of importance in today's world of global sourcing and production outsourcing. The recommendations offered in this article can help supply chain professionals more effectively integrate the physical flow of goods with the financial flow.
As the previous series on Creating the Optimal Supply Chain amply demonstrated, there are three essential flows in a supply chain - Material, Information and Financial flow. While the first two are often frequently dissected and analyzed, the third is comparitively less so and thus I thought that I would do a piece on that.
Voila!!
Never have truer words been spoken:
Global sourcing and outsourcing have the added benefit of generating cash for many companies, as investments in plants, equipment, and working capital shift from the brand owners and original equipment manufacturers (OEMs) to their trading partners, who in many cases are overseas. While these benefits can't be denied, business leaders need to assess the unintended consequences of their global sourcing and outsourcing strategies beyond direct cost and capital savings. In particular, they need to recognize that the labor cost advantage of moving these activities offshore masks hidden costs and risks within the financial supply chain.
Read the rest of the review here.
Tags: Financial Supply Chain, Rising Inventories, Globalization, Offshoring, Outsourcing, Working Capital, Vertical Integration
posted by AJ @ 9:23 AM
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