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Supply Chain Performance Management: Role And Importance Popular Mba Argumentative Essay Help

Table of Contents
Abstract Presentation Displays Maturity Strategy Concluding Remarks References


A company's supply chain (SC) is a crucial component of its operations, hence it must be continually maintained and improved. In addition, it is essential to have a responsive and adaptable SC that enables the firm to execute change and introduce enhancements without disturbing the core SCM operations. Therefore, an examination of SC elements and features is essential for a company's performance and project implementation. By introducing the ideas of agility and innovation into the SC framework, one will be able to maintain its viability even in a highly competitive environment.


A supply chain (SC) is fundamental to any corporate operation. An SC performs a significant job in a firm by facilitating the acquisition of materials for the commencement of the production process. A SC is defined by Shahbaz et al. (2019) as "the flow of information, material, and money from suppliers to end-users" (p. 4301). Therefore, maintaining the SC and comprehending the factors that characterize its operation are essential to the effective operation of an organization. For this reason, it is necessary to identify essential SC properties, such as phenotypes and maturity rate, as well as appropriate maintenance measures. One can develop a well-functioning SC by incorporating a profound leadership approach, a concentration on innovative thought, and the adoption of good financial assessment methods.


To comprehend the nature of a SC, one must be familiar with its defining characteristics and traits. Several dimensions through which the efficacy of SCM can now be evaluated have been identified. These include a focus on innovation, the development of important financial KPIs that provide vital information about the SC's operation, a well-developed logistical approach, a communication network that is driven by feedback, planning, and strategic sourcing. Notably, the aforementioned traits must be merged as interconnected notions as opposed to as fragmented elements. Once included into the SC architecture as elements of a single system driven by innovation and data sharing, the described qualities of a SC will contribute to its operation.

Financial indicators are often ranked among vital characteristics since they provide a clear picture of the opportunities a company might pursue with its current financial holdings. Balanced Scorecard is commonly regarded as the most effective method for controlling the financial aspects of an organization's SCM process (Llivisaca et al., 2020). In addition to allowing a company to assess its progress and determine its financial state based on current performance rates, the Balanced Scorecard approach allows for the development of projections. Consequently, based on the use of the Balanced scorecard technique, future strategies for retaining financial assets and even multiplying them can be devised.

Communication is another essential characteristic of a SC, as it provides insight into the level of collaboration within the SC and potential problems that may arise during the information management process. The effectiveness of communication determines the success of knowledge exchange and, thus, the amount to which a SC remains current and responsive to market developments (Marimin et al., 2017). Consequently, the incorporation of agile approaches that enhance communication effectiveness is a desirable addition to the SCM framework. In addition, the use of IT and IT solutions to enhance communication effectiveness is strongly advocated.

The ability to plan is yet another SC characteristic that impacts its performance outcomes. Even though quick changes in local and worldwide marketplaces are common, businesses can still develop a flexible plan that will keep SCs operational in the case of a significant change. Collaboration and change anticipation form the basis of an agile planning framework for an effective SC.

Lastly, it is important to note that a well-designed logistical structure is an essential characteristic of a modern SC. The quality of a company's logistics strategy relies heavily on other characteristics, particularly the efficacy of communication and overall data management. By introducing a faultless communication tool based on a rigorous data analysis, it is possible to develop a logistical framework free of delays and misconceptions that impede logistics processes. Since the current emphasis on the agile method has acquired more popularity than the old lean framework due to the numerous benefits it gives in comparison to lean SCM, it seems fair to introduce agility to logistics. Specifically, it indicates that the development of omnichannel reverse logistics is advantageous for SC managers. The proposed method is considered to aid in maintaining a steady SC flow. With the creation of a single inventory pool for SC and the collection of real-time data on this inventory pool, it will be possible to construct an efficient logistics framework.


Additionally, the maturity of a SC must be evaluated as one of the factors influencing the selection of performance management strategies. The concept of SC maturity often refers to the degree to which the SC in question demonstrates resilience in the selected economic context. In general, mature SCs may be maintained in environments that can be characterized as harsh. In addition, the high maturity of SCs means that they should be able to extract crucial resources and opportunities even from economically and financially unfriendly circumstances.

In addition, the levels of maturity characterize the variety of relationships that an organization has established during its existence and success. Specifically, the number of firms with which a company has built links, including the diversity of its partners, suppliers, and investors, influences the organization's capacity to maintain its mature position without nearing the decline stage. Although the latter is ultimately inevitable, it is feasible to delay it through the use of proper techniques and smart utilization of an organization's resources.

The initial stage of maturity in the SC setting is typically characterized by high rates of reactivity. In turn, the second requires internal SC integration, flexibility, and collaboration. The third and last one concentrates on dynamic adaptation. The latter is essential to a SC's continued survival in the market environment. It is induced by ever-changing external influences and the introduction of new factors that influence the performance of a SC (Sjodin et al., 2018). However, other factors also play a role in determining the rate of SC maturity. The levels of reactiveness, for example, indicate the amount to which a company can adapt to emerging obstacles and new opportunities in the target market (Sjodin et al., 2018). In turn, the levels of a SC's flexibility determine how quickly it can respond to these changes and how effective its modifications will be. Similarly, collaboration impacts the SC at its core due to the necessity of cooperating with each SCM process participant. Thus, a business may assure that products and supplies are delivered on schedule and that its primary objectives are met.

Therefore, maturity should be acknowledged as a vital criterion for evaluating a SC's performance. One can manage the extent of a SC's resilience, the level of collaboration within it, and its ability to adapt to changes in its target environment due to the SC's maturity. Thus, a company will be able to reach the final phase and establish a common framework for responding to change and supporting innovation throughout its SC.


In contrast to qualities and maturity, which often have a predetermined set of characteristics and elements, methods that can be employed in the SC context are varied and versatile. Depending on the circumstances of the corporation and its target environment, the formulation of these plans frequently necessitates out-of-the-box thinking regarding conventional business strategy approaches. In the process of building a SC strategy, it is possible to identify certain homogenous parts.

Traditionally, SC management (SCM) begins with market research, which includes segmentation and profitability analysis, as well as the presence of competitors and an overall development forecast (Yu et al., 2016). The next step in developing a SC strategy is to identify the areas with the greatest potential for the organization to explore. Then, a SC strategy is developed based on the results of market research and an analysis of the company's strengths and shortcomings (Yu et al., 2016). The specified strategy necessitates a comprehensive examination of the target market and the customers that comprise it, as well as the identification of the desired niche and an analysis of the competition.

Typical SC strategies emphasize innovation, particularly the promotion of incremental improvements as the foundation for the company's growth and disruptive breakthroughs as a means of acquiring market power. In addition, the emphasis on communication and uninterrupted data flow as the primary factor in carrying out the critical logistics activities must be highlighted as a crucial SCM strategy (Golgeci & Kuivalainen, 2020). The approach outlined advises that stakeholders should communicate and keep each other apprised of any impediments to the delivery of the required materials, as well as delays and other concerns. Thus, there will be fewer misconceptions, which will reduce the risk of errors and improve the efficacy of SCM.

In addition, strategic SCM will necessitate the assessment of real-time fluctuations in client demand. Prior to a few decades ago, identifying shifts in client demand in any market would have been deemed impossible. However, the current collection of tools for regulating and observing changes in the desired economic environment renders the outlined objective highly realizable. The deployment of the agile SC as the company's primary strategy for managing its internal operations is also noteworthy. Nor a relatively recent addition to frameworks for handling SCM issues, agility has not yet been completely defined, as has the concept of agile SCM (Al-Refaie et al., 2020). Currently available subject matter definitions range from adaptability in executing important SCM activities to collaboration and effective information management in the SCM setting (Tarafdar & Qrunfleh, 2017). In spite of this, the incorporation of agility into the context of modern SCM is crucial for establishing a competitive edge.

In addition, six essential components of agility and ASM have been discovered. These include the capacity to rapidly alter course, enhance essential operations, analyze the target environment, empower buyers, preserve flexibility, and recover from interruptions (Gligor et al., 2019). With the integration of ASM, it is anticipated that the processes inside the SC will be better coordinated. In addition, the incorporation of ASM is anticipated to strengthen an organization's resistance to a variety of shocks, changes, and damage on local and international marketplaces. It is believed that the described shift will occur due to an increase in readiness and improved data management.


By building a financial meter that enables for meticulous assessment and forecasting, as well as a leadership framework that emphasizes innovation and corporate ethics, one will be able to create a SC that functions flawlessly. Although other features, relevant to the target environment, will need to be included as the SC grows, the aforementioned components form the majority of a well-designed SC in the context of the contemporary global and local economy. As a result, one may advise establishing tools to encourage innovation and exercising strict supervision over corporate processes, especially financial and maturity-related activities. Thus, the life cycle of an organization will be stretched to its fullest extent, as far as its economic potential will allow, and every opportunity will be utilized to support its continued growth. With an emphasis on a well-structured SC, a firm will develop an exceptional competitive advantage that will enable it to achieve a prominent position in the target market.


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