How the Term “Supply Chain Management” Was Coined

It is widely known that the term “supply chain management” was popularized by Keith Oliver, among others, in the early 1980s. Interestingly, in a 2003 strategy+business article, Oliver has revealed that, looking for a catchy phrase, his consulting team originally proposed the term “integrated inventory management” (I2M). While, in our modern understanding, SCM is focused not only on intra- but also inter-organizational coordination and typically takes a more strategic perspective, “I2M” already focused on “tearing down the functional silos that separated production, marketing, distribution, sales, and finance to generate a step-function reduction in inventory and a simultaneous improvement in customer service”. Later, at a key steering committee meeting, Oliver’s team introduced “I2M” but “the phrase failed to resonate with participants”. One of the managers, a Mr. Van ’t Hoff, challenged Oliver to explain what he meant by “I2M”. I am not sure whether Mr. Van ’t Hoff is aware of it, but this moment marked the birth of the term “supply chain management”:
We are talking about the management of a chain of supply as though it were a single entity, Mr. Oliver replied, not a group of disparate functions. Then why dont you call it that? Mr. Van t Hoff said. Call it what? Mr. Oliver asked. Total supply chain management.

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About Andreas Wieland

Dr. Andreas Wieland is an Associate Professor of Supply Chain Risk Management at the Department of Operations Management, Copenhagen Business School. His current research interests include resilient and socially responsible supply chains.

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