CHSCM 3.0 - Unit 1 - SCM in the Humanitarian World

The first aspect is the proliferation of product handled. The supply chain becomes more complex as
more products are introduced into it. Each product has to be controlled separately and accounted
for throughout the supply chain journey.
The second major aspect of complexity is the increase in the number of stocking points within the
supply chain network. As new stock points are added, inventory levels increase. These networks
often become rapidly geographically fragmented, making their management and coordination more
complex.
Together, product and network complexity combine to pose major challenges to supply chain
managers. These features of the operating environment are unlikely to disappear, so management
must focus on the effective handling of this complexity.
We explored how supply chains are comprised of different participants, performing different
processes, under the guidance of specific functions. Traditionally, most organizations have been
managed through functional structure; indeed, most individuals identify with a function. When
asked what one does, one replies that he or she is a warehouse manager or inventory planner;
rarely does one say he or she works in the Sudan disaster supply chain.
The emphasis of this functional approach has been to seek excellence in these activities, and to find
ways of performing them most effectively and efficiently. Consequently, many people work toward
goals and objectives that have been set with this functional excellence in mind. Unfortunately,
supply chains work by spanning functions and organizations. They require cross-functional
cooperation and coordination to make them work.
A supply chain is a process, not a function. For the process to work smoothly, we must first
integrate the internal functions. This requires that the impact on the entire supply chain is
considered when setting functional objectives. It is therefore necessary for everyone to understand
how the whole process works, rather than simply the individual pieces.
Once internal integration is complete, the next step is to integrate with the immediate supply chain
partners. This is often more straightforward than the internal alignment. Gradually, the mutual
cooperation and coordination can be expanded to include all supply chain participants. Sometimes
this external integration is called collaboration.
The geographical dispersion of the supply chain activities will create the need to embrace different
cultures and languages. For this reason, integration will likely be the most difficult challenge to
which supply chain managers must respond. It also emphasizes the human aspect of the supply
chain because supply chain performance depends as much, if not more, on the nature of people
relationships than it does on the processing and movement of goods and materials. Human
behavior drives performance which, in turn, determines supply chain performance.
There is further complication when we consider how the three flows that comprise supply activity
are managed. Recall that the three flows are physical goods, information, and finance. Frequently,