1.1 Background of study
Increased domestic and global competitions, economic downturns, rapidly changing the market trends, and volatile financial markets have all increased the pressure on organizations. Moreover, ease of traditional trade barriers; economic liberalization, globalization and deregulation have thrown several challenges to organizations in developing and newly industrializing economies like Thailand. To effectively respond to the rapid changes in external environment, several firms have been deploying new strategies to improve their competitiveness. Intensive domestic or global competition and the need to improve bottom line has made manufacturing and service organizations consider an integrated approach to manage their supply chain
Supply chain management is a cross-functional approach to managing the movement of raw materials into an organization and the movement of finished goods out of the organization toward the end-consumer. As corporations strive to focus on core competencies and become more flexible, they have reduced their ownership of raw materials sources and distribution channels. These functions are increasingly being outsourced to other corporations that can perform the activities better or more cost effectively. The effect has been to increase the number of companies involved in satisfying consumer demand, while reducing management control of daily logistics operations. Less control and more supply chain partners led to the creation of supply chain management concepts. The purpose of supply chain management is to improve trust and collaboration among supply chain partners, thus improving inventory visibility and improving inventory velocity.
(http://en.wikipedia.org/wiki/Supply_chain_management)
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