Share
Explore BrainMass

Explain how the supply chain differs for a company with a physical product versus a service. Also explain the how the concepts of disintermediation and reintermediation affect the supply chain.

Solution Preview

Explain how the supply chain differs for a company with a physical product versus a service.

Supply chain management is the process of planning, implementing, and controlling the operations of the supply chain with the purpose to satisfy customer requirements as efficiently as possible. Supply chain management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point-of-origin to point-of-consumption (Wikipedia, 2006). This concept has become increasingly popular and those organizations who are recognizing the importance of effective supply chain management are gaining significant competitive advantage over their competitors because of way they are configuring and managing their supply chain.

The supply chain management of service is different. Service facilities are more dramatically affected by the customer interface as compared to the manufacturing organization. The key difference between service and product organizations:

1. Products are tangible, Services are intangible
2. Services are typically produced and consumed simultaneously, but physical products can have inventory. Thus services are inseparable
3. Services are perishable and cannot be stored
4. Variability is much more in services as they depend on who they provides them and when and where they are provided.
5. The encounter between the customer and services must be provided for in the service organization. This encounter can be intense because customer actually becomes part of the ...

Solution Summary

About 300 words, three references.

$2.19