STUDENTS' CORNER - 132
Whatever strategy is followed, the
primary goal of a business must be promoted and reinforced. Today, with ever
expanding business domain, having moved away, necessarily, from a simple barter
to complex business experience, all business activities focus on some basic
goals. And to achieve the goals, managing supply chain has become integral to
the management of the business. And no business worth the name is ever possible
without meticulous planning.
Though planning is a continuous process at all
different levels of business engagement, some more attention must be given
while planning to three areas: finance, strategy and operations. As usual, we will go into the basics of these
three areas with a clear focus on efficient supply chain management. Unless all
the three function in coordination business in some way or other becomes
crippled, or at least, halted till required coordination is achieved.
The three Ms are indispensable for a
business: Man, Money and Machine. Money and Machine dwindle into dead assets
without Man’s meaningful intervention.
Man and Machine cannot make any impact on the world without money; and,
without Machine, man cannot produce enough, so to say, to meet the basic
demands of the society. Depending on the demanding context, one of the three
Let us begin with finance, that is,
simply, money for the business; capital is the word used often. There are some well-defined objectives for
finance. Before that, how to put money in the business? You can put your own money into the business
and start one; you can get a loan from some rich individual or, much better,
from some banks; or, you can ask someone else to join you as a partner by
putting his money. With adequate money
you start a business, let us say. Now, what are the objectives of putting money
into the business, what is the objective of investing money in a business? How should money function and what are its
objectives? To put it in a plain
language, money should make more money that is it should get some excess money,
profit, from the business. They call it revenue generation. It is also known as
Return on Investment. You invest and you get some benefit out of your
investment. All business activities are
oriented, focused on Return on Investment.
We will see the next two components of
business planning, strategy and operation from the supply chain management
point of view.