Creation of Shareholder’S Value Through Supply Chain Management

Evaluating the Impact of Supply Chain Management on Shareholder Value

Abstract

a global economy and increase incustomer expectations in terms of cost and services have put a premium oneffective supply chain reengineering. It is essential to perform risk-benefitanalysis of reengineering alternatives before making a final decision. This paper identifies and demonstrates variousbenefits in terms of real cost savings from supply chain management.Considering the philosophy “What you cannot measure, you cannot manage”,measuring the supply chain performance becomes tremendously important for companiesand their supply chains in order stay competitive. So far only a small numberof performance measurement systems exist that can help to understand andimprove a supply chain’s overall performance. One of the greatest challengestoday for managers in the supply chain is the general shrinking of operatingincome margin in most industries. This decline in profitability is motivatingcompanies to change how they do business, especially in the supply chain areas.