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The goal of good supply chain management is to keep inventories down while ensuring that the speed of flow of the product through the chain is optimized. Supply chain management is the whole vertical management of a product from the extraction of its raw materials to its sale to the consumer.

Supply Chain Management can be broken down into 3 main functions; product flow, information flow and financial flow.

There are four major elements of supply chain management: integration, operations, purchasing and distribution. Each relies on the others to provide a seamless path from plan to completion as affordably as possible.

Supply chain management software (SCM) is used in the management of producing a product from raw materials through the various manufacturing and distribution processes until the product ends up in the hands of the consumer. Supply chain planning software helps organizations manage and replenish their inventory through sales and demand forecast

Examples of ERP system modules include: product lifecycle management, supply chain management (for example purchasing, manufacturing and distribution), warehouse management, customer relationship management (CRM), sales order processing, online sales, financials, human resources, and decision support system.

Supply chain management has been an integral part of ERP solutions adopted by several enterprises. Manufacturers need to interact with various suppliers and partners to obtain the raw materials and resources at the right time and at the right amount to bring finished goods to market.