By Staff Writer | 06/17/2025
The modern business world simply cannot exist without strategic global supply chain management. From the C-suite that oversees business administration to the marketing department and frontline workers, supply chains impact every employee within an organization.
What Is a Global Supply Chain?
According to Adam Hayes of Investopedia, “A supply chain includes every step that's involved in getting a finished product or service to the customer. The steps may include sourcing raw materials, moving them to production, then transporting the finished items to a distribution center or retail store where they can be delivered to consumers.”
You can think of each step as its own link within the chain. Often, the links that comprise supply chains are dispersed around the globe. Therefore, most value chains include global supply chains.
The Europe-based Organisation for Economic Co-operation and Development estimates that nearly 70% of international trade involves global value chains and global supply chains. From raw materials to services like manufacturing, different countries provide different resources.
For example, a coffee shop that operates in the U.S. might depend on a global supply chain to serve its customers. Coffee beans often come from producers in Latin America, Africa, and Asia.
Meanwhile, China manufactures paper cups, while the U.S. produces its own dairy products. In effect, an unassuming cappuccino that you purchase at your local coffee shop is ultimately the product of a complex global supply chain.
“As supply chains extend their reach around the world, they can bring both necessary and new and exciting products to people in various countries,” the Association for Supply Chain Management (ASCM) states.
What Does Global Supply Chain Management Entail?
Understandably, global supply chain management is complex. If we break down its components, however, we can easily understand how supply chains help fuel global trade.
There are five phases of supply chain management (SCM), as Jason Fernando of Investopedia explains:
- Planning
- Sourcing
- Manufacturing
- Delivery
- Returns
Planning: Preparing to Meet Customer Demands
Effective SCM invariably begins with planning. Supply chain professionals must work to identify customer demands and determine how companies may accommodate them. In other words, the planning process lays the groundwork to manufacture and sell products.
Sourcing: Procuring Materials
For many companies, sourcing raw materials requires crossing international borders. Even when materials are available domestically, this strategic sourcing provides a competitive advantage. Vendors from other countries often depend on international business, and they sell materials at cutthroat prices.
Still, as Fernando advises, supply chain management professionals should always do their due diligence and look beyond pricing alone to find reliable vendors. For instance, vendors should have a demonstrated ability to deliver high-quality materials on time – especially when those materials are perishable.
Manufacturing and Production: Creating Finished Products to Sell
There are many leading companies that rely on cheap manufacturing and production to maintain a competitive edge. From consumer goods firms to pharmaceutic enterprises, organizations always strive to adopt cost-saving business strategies. Naturally, this drive to cut costs has led countless companies to work with manufacturers in other countries like China and India.
Nevertheless, as Fernando notes, the manufacturing process is considerably lengthy. It consists of several steps, including:
- Product assembly
- Product testing
- Quality control
- Packaging
Delivery: Getting Products to Consumers
The penultimate link in the supply chain requires coordinating the logistics of transporting products to distributors, retailers, or customers. Timely distribution is crucial for meeting market demands and running a profitable business.
Fernando recommends that companies use diversified distribution methods so products can still be delivered “should one mode of transportation temporarily be unusable.”
Returns: Taking Products Back and Issuing Refunds
A seamless returns process is integral to customer satisfaction. In fact, the retail-oriented information technology (IT) firm, WeSupply, reports that “76% of shoppers considered free returns a major factor influencing their choice of retailer” in 2024. Clearly, businesses can’t afford to overlook this final link in the global supply chain.
Moreover, as the ASCM explains, reverse logistics – the process through which companies complete returns – can play an important part in corporate sustainability efforts. For example, companies like coffee pod manufacturers can use reverse logistics to accept and recycle used products from their customers, as the ASCM notes.
What Is the Difference Between Supply Chain Management, Logistics Management, and Operations Management?
“The terms supply chain management (SCM) and business logistics management or simply logistics are often used interchangeably, but logistics is one link in the supply chain,” explains Hayes.
Similarly, supply chain management and operations management (OM) also overlap. Nonetheless, these three domains are distinct, and each serves a unique purpose.
Supply Chain Management
According to the ASCM, “Supply chain management is the design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand, and measuring performance globally.”
While operations and logistics management each contribute to supply chain management, these terms are not synonymous. Rather, logistics and OM are separate functions.
Logistics Management
Inbound Logistics explains that the logistics management process is “the part of supply chain management that plans, implements, and controls the efficient, effective forward, and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption, handling goods from raw materials to the delivery of finished products to meet customers’ requirements.”
Operations Management
Also according to Inbound Logistics, OM “is concerned with converting labor and raw materials into goods and services as efficiently as possible to maximize profits.
An operations manager typically leads this department, overseeing the daily operations to produce goods and services. It is particularly predominant in manufacturing and service industries where managing resources, capacity, inventory, and scheduling are paramount.”
How Is Global Supply Chain Management Relevant to Service-Based Businesses?
“Many people mistakenly believe that global supply chains have no connection to service-based businesses. In reality, these businesses are heavily reliant on global supply chains for essentials, such as office equipment and technology,” says Antonio McMillan, a supply chain management faculty member at the Dr. Wallace E. Boston School of Business at American Military University (AMU).
“A clear example of this dependency is the outsourcing of IT support and customer service,” he adds. “Service-based businesses often contract these operations to countries with lower labor costs, essentially applying the principles of global supply chains to the sourcing of talent and labor.”
How Does Global Supply Chain Management Fuel International Business?
“Global supply chain management is a cornerstone of international business,” says McMillan. Every component of the supply chain impacts an organization’s ability to sustain its operations, both abroad and domestically.
For example, U.S. companies have long been able to save on production costs by working with overseas suppliers and manufacturers. These savings have, in turn, enabled businesses to develop entire marketing strategies around competitively priced products.
“I once worked for a company where I witnessed leadership make the strategic decision to close several U.S.-based warehouses and distribution centers to enhance long-term competitiveness. This move allowed the company to grow its global presence and attract new vendors,” McMillan says.
“Through my academic research, I later discovered that the company opened manufacturing and distribution facilities in Asia and Mexico to expand its reach within North America and internationally.
Today, the company operates in over 25 locations across 20 countries. This strategic decision improved time-to-market capabilities, enabling the company to meet customer and vendor demands for shorter lead times – a critical factor in remaining competitive.”
How Do Organizations Apply Data Science to Global Supply Chain Management?
There are countless applications for data science in global supply chain management. Every link within the chain employs technology and data science to support efficient, profitable operations.
“Data science plays a pivotal role in optimizing global supply chain management by empowering businesses to make informed decisions across various stages, including planning, procurement, logistics, and delivery. These decisions rely heavily on statistical and analytical data provided to logisticians and supply chain managers,” says McMillan.
“Its importance lies in forecasting sales, optimizing processes, and improving product visibility within the global supply chain. During my experience working for a global grocery retailer, data science was utilized to allocate products to stores in different regions based on historical spending data,” he adds.
How Can Companies ‘Course Correct’ When Disruptions Occur Within the Global Supply Chain?
Strategic global supply chain management allows companies to maximize profits by connecting with vendors and buyers located around the world. Nevertheless, international business is constantly subjected to an onslaught of new challenges brought on by unpredictable factors, ranging from geopolitical shifts to natural disasters.
“Over the past seven years, the world has witnessed numerous global supply chain disruptions,” says McMillan. “These disruptions include events such as the container ship Ever Given blocking the Suez Canal and a catastrophic fire rendering one of Japan’s largest computer chip supplier factories inoperable.”
These challenges require organizations to adopt long-term and short-term strategies, so they can pivot as needed, McMillan explains.
“Short-term solutions include identifying secondary suppliers across different regions or countries and establishing new partnerships with reliable freight providers. Companies can also maintain emergency stockpiles to mitigate immediate risks.
“Long-term strategies involve adopting modern technology, conducting quarterly risk assessments, and enhancing communication with all supply chain stakeholders. Organizations should maintain flexibility as well to adapt to future disruptions,” he adds.
“Supply chain course correction is an ongoing process that requires continuous refinement. By implementing immediate short-term solutions alongside forward-thinking, long-term goals, companies can build resilience and better equip themselves to overcome global supply chain challenges.”
Supply Chain Management Degrees at American Military University
Supply chain management strategies have a widespread impact on commerce throughout the entire world. Knowledge of SCM principles is therefore a vital aspect of modern business education.
To serve learners interested in gaining real-world knowledge of global supply chain management, AMU offers three online degree programs:
- An online Associate of Arts in Supply Chain Management
- An online Bachelor of Arts in Supply Chain Management
- An online Master of Arts in Supply Chain Management
Core courses explore foundational concepts that include global demand management, risk management, reverse logistics, as well as inventory management and the use of artificial intelligence in SCM. Students will also discuss the common challenges that plague professionals in the supply chain management industry, and class discussions will examine potential solutions.
For the bachelor’s degree, there are several concentrations to allow learners to focus their studies, including:
- General
- Government contracting and acquisition
- Reverse logistics management
- Transportation and logistics management
These programs have also received specialty accreditation from the Accreditation Council for Business Schools and Programs (ACBSP®). This specialty accreditation ensures that AMU’s supply chain management programs have been examined and held to high academic standards by higher education professionals.
As an online institution with learners and educators from all over the world, AMU connects students with plentiful networking opportunities. For more information, visit AMU’s business administration and management program page.
ACBSP is a registered trademark of the Accreditation Council for Business Schools and Programs.