Understanding basics of Supply Chain Management

Supply Chain management can be understood better as "The Management of the Chain of Supplies".
It is the managing of upstream and downstream value added flow of materials, final goods and related information amoung suppliers, company, resellers and final consumers.

In simple terms, the management of the below to manufacture Product or Service,
* buy things/services
* make things/services
* move things/services
* sell things/services
* service things/services (helpdesk, replacement of damaged..)

And a Supply Chain Manager should be able to do all the above flawlessly and still manage to make good profit.


In Microsoft Dynamics Ax 2012, many new features are introduced to handle SCM effectively. Below are few listed:

1. Product Information Management
• introduction of Creating and Releasing products/product mastersProduct: is a uniquely identifiable product.
  Product master: A standard or functional product representation
  Product variant: is the configuration of a product master
• introduction of Configuration Technologies (#3)Predefined variant: enables the product to be modeled based on the product dimensions, i.e, color, configuration and size.
  Dimension-based configuration: used to create product variants by selecting values for product dimensions.
  Constraint-based configuration: enables a product to be used in product configurator
2. Agreements
• Sales and Purchase AgreementsSales agreement: is a contract that commits the customer to buy a product in a certain quantity over time in exchange of special prices and discounts.
  Purchase agreement: is a contract that commits an organization to buy
• improvements in Trade Agreements
3. Procurement and sourcing
• Purchase order and Change management
  Change management: lets you review and track history of a PO before it is approved.
• improvements in Vendor management
• Purchasing Policies
  is a collection of purchasing policy rules that control the requistion process for a group of requisitioners.
• enhancements in Purchase Requisition and PR ConsolidationPurchase Requisition: is an internal document that authorizes the purchasing department to buy items and services.
  Requisition Consolidation: is a practical way to reduce procurement costs for organizations to consolidate demand.
• Business rules for Fixed Assets
4. Manufacturing and Scheduling
• Operations resource model
  Resources can be allocated to jobs and operations by matching the capabilities of the resource with the requirement of the operation.
• improvements in Resource scheduling
• Period Templates
  are introduced to make creating schedules such as production, purchase, sales and final assembly schedules easier.
5. Lean Manufacturing
• Production flow
  to describe the flows in manufacturing and logistics supported by Lean activities.
• Kanban board and Event Kanbans
  Kanban board: uses the different approaches and features of Lean manufacturing integrated into a single, configurable user interface for the shop floor.
• introduces Mixed mode
  enables companies to implement different production strategies on a single production site.
• introduces Subcontracting
6. Time and Attendance and manufacturing execution
• introduces Time and Attendance
  this module is used to create and process time and attendance registrations which are matched against workers time profile in order to give an accurate picture of the individual workers work effort and enable the company to make informed cost and payroll decision.
• introduces Manufacturing Execution
  is primarily targeted for use by manufacturing companies, workers can register time and item consumption on production jobs by using the job registration form.
7. Product configurator
• introduces building a Product Configuration model
• prepare for a Model for Release
• Product Configuration
  Product configurator: is a constraint-based product configuration tool that uses the Microsoft Solver Foundation product. It can be used to create and maintain product models and to reuse product models, components and attributes. Can also be used to configure items on sales order, sales quotation, purchase orders and production orders.
8. Process manufacturing
• improvements in Catch weight
• improvements in Product Information management
• improvements in Inventory and Warehouse management
• improvements in Procurement and Sourcing and Sales and marketing
• improvements in Production Control and Master Planning
• Process manufacturing reports
9. Intercompany
• Intercompany Reports
• Intercompany Planning
   

Few key areas of SCM as in Ax2012 are listed below:

• Purchase Order Line Numbers,
• Subledger Distributions,
• Vendor lines not related to a PO,
• Two voucher strategy for Purchase Distributions,
• Invoice totals matching,
• Extended price totals matching,
• Miscellaneous charges,
• Prepayments
• and Change management.