End to end (or end-to-end) is a term used in many sectors of business to refer to a process spanning from the beginning to then end point of a service or operation. Offering an end to end service implies that you are eliminating as many steps, layers or levels of expense as possible, in a way that will optimise the efficiency and performance of that service.
A good example of an end to end supply chain process would be one that connects buyers and sellers directly, perhaps in an ecommerce or manufacturing context. For example, an end to end supply chain management company might provide a service to a client company, managing all aspects of the production, warehousing and distribution of one or more products. The ‘ends’ are the end product all the way to the end user.
There is often a confusion of the concepts of ‘supply chain management’ and ‘logistics’. Logistics is best thought of as one part of the broader concept of end to end supply chain management. Logistics deals only with how information (data) and physical material (goods) flow from the suppliers of raw materials through the manufacturer, and to the consumer (and back). Of course, there are usually many more links in the actual supply chain. While the concept of logistics has been expanded recently (it did not always concern itself with data flow or reverse logistics, which is the movement of goods back from a ‘later’ link in the chain to an ‘earlier’ link), it is still limited to methods of managing and effecting this flow.
On the other hand, Supply Chain Management is a broader term which encompasses all aspects of the management of information, materials, and money or financial obligations, and how they flow through a complicated network between customers, distributors, suppliers, and manufacturers. It includes logistics, but uses an interconnected network model rather than the ‘chain’ image, and considers all the different nodes on the network, and all of the dependencies each node has to meet before it can serve the other nodes.
Beyond mere logistics, SCM encompasses aspects of operations management, procurement, and information technology, and attempts to deal with them all in an integrated fashion.
The ‘lemonade stand’ example of end to end supply chain management
Every business imaginable has some kind of supply chain.
As a traditional, if drastically simplistic model, take the humble childhood lemonade stand. Many resources are required to set it up. On the first level, you will need Lemons, sugar, water, cups, and the stand itself. Now, expand this model to include the network that made these resources available – the public water supply, the grocery store, car or bus which transported the goods to you, the bank account with which the ingredients were bought, the monthly fee to maintain the water supply, and the loan of Dad’s wallpapering table. We could expand that to include farmers, the sugar refinery, the company that processes the debut card transaction, etc., but we’ll stop before we get bogged down.
The lemonade stand’s end to end supply chain is everything needed to gather the ingredients and components, and put them into the customer’s hands in a desirable and profitable way.
Now, in this model, who is the end to end supply chain manager, but Mum? She makes sure you have the materials and ingredients, while you add value (assembling the lemonade) and hopefully sell it for a profit. (We’ll assume Mum is either a bit mercenary, or very concerned with your economic education, and is charging you at least cost for the ingredients).
Mum knows what she’s doing. She’s managed lemonade supply chains before, while you haven’t. Where you might walk down to the store to get lemons, realise after coming home you forgot the sugar, and go back, she does it all in one trip. She even has a fleet (the family Vauxhall) and can transport it efficiently.
So, what is the take-home? The children running the stand know all about making lemonade and selling it to passers-by, but without an end-to-end supply chain manager, they would not be running an efficient operation.
Configuring an end to end supply chain requires expert assistance
A fully integrated and to end supply chain is the key to efficient operations for most participants in national or global markets. The problem is that supply chains everywhere are becoming fragmented and widely dispersed, and the integration of this network of dependencies is rapidly becoming a task too exacting for the non-specialist. What was once the simple business of getting goods to the end customer has now become a monumental task including the coordination of a multiple-tier network of partners both upstream and downstream of you, sometimes on different continents. Because the network is so complicated and widely dispersed, it is highly vulnerable to disruption. The development of a strategy that addresses these needs is vital.
Configuring your end to end supply chain with the advanced capabilities efficient operation requires is, as in our lemonade stand model, the province of the expert supply chain manager. Most have developed their own frameworks for assessing your current and hoped-for end-to-end capabilities. This gives them the concepts and tools needed engage cross-functional teams to develop a strategy suited to your business needs. A good supply chain management specialist can often uncover hidden capabilities in your processes as well as unknown capacity gaps that must be addressed before progress can be made.