Customers are the very make up of how business evolves in today’s global marketplace and without them the supply chain would not exist. Supply and demand has been the basis of the customer focus and direction. In the supply chain everyone can be classified as a customer because they supply to other entities to make the process function smoothly. Customer focus is the key to running a successful yet productive supply chain. Uncertainty is bound to occur during any supply chain operation. How a supplier react to the situations that arise if what bring validity to the supplier and their ability build a positive relationship. The purpose of the paper is to discuss the concept of the customer, how the customer relates to the supply chain and the unexpected changes in customer demands that effect the supply chain management.
The Customer and their Role
The customer is the voice of delivery for good and services to a specific supplier or manufacturer ensuring that they uphold a standard that is ethical and beneficial to all parties. Customer service between shippers and their logistics providers means more than just a friendly voice on the line when something goes wrong it is being able to communicate and react in a timely manner to ensure that quality service is delivered. When both parties in the supply chain interact, the supply chain relationship can be a partnership. The process of interaction includes short-term as well as long-term relationship transactions (Ryu, So & Koo, 2009). Customers make up the key components of the supply chain and their ability to supply raw material or finished good to their customers. According to Tara Duggan of Chron’s Business:
Supply chain management strategies enable companies to ensure the business has the materials, information and financial resources it needs to produce quality goods and services in a timely manner. By coordinating the flow of work from vendors to manufacturers and then from distributors to retailers, effective supply management techniques reduce inventory and ensure product availability when required. Customer relationship management programs are used to ensure parts and service get to customers when needed after sales are completed by automating business processes used for sales, service and support. Integrate supply chain management and customer relationship management functions to maximize your operations (Duggan, 2013).
Unexpected Changes within the Supply Chain Having a successful supply chain is all about being flexible and adapting to change and being able to support the needs of the customer. Suppliers are ultimately the driving source of any supply chain because of their ability to produce keep manufactures in business. Customer demands have always been hard to predict, and uncertainty in customer demands has increased (Simchi, Kaminsky & Simchi, 2008, p. 32). Suppliers have several challenges that can affect the supply chain. Manufactures can run a supplier out of materials; can cause customers to redirect their focus if they cannot obtain the necessary components to produce, and having to recover should there be a problem with a sub-supplier. Suppliers have to ensure that they have enough safety stock in house to support the increase demands of their customers. Machining problems seem to be one of the biggest hindrances amongst most automotive suppliers. Within the supply chain anything can happen from theft to damaged or misplaced product. Time constraints and replenishment can be difficult issues when recover is vital to an operation. Such losses will delay or stop production all together which cost the plant money because they have to pay union workers regardless to what the issues are. Plant downtime can be an obstacle because in most cases a supplier is charged for down time if the supplier is found to be the root cause for the shutdown. The quantitative differences depend on service level and also the form of demand
