Every strategic and operational decision taken in a supply chain has financial implications. Supply Chain Management can be seen from two perspectives.
First SCM objective is to optimize Supply Chain cost and investments. Supply Chain costs represent a significant proportion of the cost in different industry sectors (in average 6.8% of the turnover for freight and distribution cost). So streamline your supply chain impacts directly on the overall profitability of your company.
Secondly, SCM is concerned with the financial flows across your Supply Chain coming from the final customer to your companies and the other stakeholder of your supply chain. It directly impact the speed of cash to cash cycles.
Chief Financial Officers and their teams of finance executives have a key role to play in the supply chain decisions. For S&OP Planning, cost and profitability are the common language the different departments have to speak in.
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