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Chapter6 Supply Chain Text A. The Emergence of Supply Chain Managers in the last two decades have witnessed a period of change unparalleled in the history of the world, in terms of advances in technology[1], globalization of markets, and stabilization of political economies. With the increasing number of world - class competitors both domestically and abroad, organizations have had to improve their internal processes rapidly in order to stay competitive[2]. In the 1960s and 1970s, companies began to develop detailed market strategies, which focused on creating and capturing customer loyalty. Organizations also realized that strong engineering, design, and manufacturing functions were necessary in order to support these market requirements[3]. Design engineers had to be able to translate customer needs into product and service specifications, which then had to be produced at a high level of quality and at a reasonable cost. As the demand for new products escalated in the 1980s, manufacturing organizations were required to become increasingly flexible and responsive to modify existing products and processes or to develop new ones in order to meet ever- changing customer needs. As manufacturing capabilities improved in the 1990s, managers realized that material and service inputs from suppliers had a major impact on their organizations ability to meet customer needs. This led to an increased focus on the supply base and the organizations sourcing strategy. Managers also realized that producing a quality product was not enough. Getting the products to customers when, where, how, and in the quantity that they want, in a cost - effective manner, constituted an entirely new type of challenge. More recently, the era of the Logistics Renaissance was also born, recreating a whole set of time - reducing information technologies and logistics networks aimed at meeting these challenges[4]. As a result of these changes,organization now find that it is no longer enough to
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