Evolution of Supply Chain Management

Although supply chain management (SCM) has only recently appeared as one of today’s most powerful strategic business concepts, its development can be traced back to the rise of modern logistics. In fact, although SCM represents a radically new approach to leveraging the supply channel in the search for order-of-magnitude breakthroughs in products and markets, it, nevertheless, is closely connected with and in many ways is the product of the significant changes that have occurred in logistics management. Over the past 30 years, logistics has progressed from a purely operational function to become a fundamental strategic component of today’s leading manufacturing and distribution companies. As logistics has evolved through time, the basic features of SCM can also be recognized—first in their embryonic states as an extension of integrated logistics management, and then, as a full-fledged business philosophy encompassing and directing the productive efforts of whole supply chain systems. A comprehensive understanding of SCM, therefore, requires a thorough understanding of the evolution of logistics management.