Chandra, Subhash (PhD)Berhane, Mesfin2018-07-062023-11-182018-07-062023-11-182007-06http://etd.aau.edu.et/handle/12345678/6777Supply chain is the interconnected set of linkages between suppliers of materials and services that spans the transformation of raw materials into products and services and delivers them to a firm’s customers. Supply chain is highly recognized in developed countries for it is estimated to consume 10% of their Gross National Product (GNP). It is therefore projected to be of a greater proportion in the developing countries like Ethiopia, where a large amount of capital is tied up in inventories and in transportation systems for moving materials. Thus, a supply chain must be managed by controlling inventories. Developing a supply chain management system (SCMS) requires the analysis of the flow of materials from the initial sourcing to the final end customers. SCM has become a universal approach to cost effectiveness, timely delivery and the creation of growth oriented exchange system in goods and services. Accordingly, different researchers have made supply chain management studies in different Ethiopian process industries and have developed models capable of solving supply chain associated problems if implemented properly. And this thesis is done with the purpose of assessing the existing supply chain environment in one of the Ethiopian discrete manufacturing industries, the Mesfin Industrial Engineering PLC (MIE), and solving the associated problems. Mesfin Industrial Engineering (MIE), being one of the Endowment Fund for the Rehabilitation of Tigrai (EFFORT) companies, is a privately owned company located at the northern part of Ethiopia, in the Tigrai provincial capital, Mekelle. MIE, is the leading equipment manufacturing and industrial engineering company in East Africa. It designs and installs equipments & components for the energy, mining, manufacturing, construction, transportation, and agricultural sectors. Because of the inherent complexity of decision making in supply chains, there is a growing need for modeling supply chain system with different methodologies. With a focus on SCM in which cost, inventory and time are the key challenges, this thesis develops a model to aid the improvement of performance of the supply chain of MIE. The model is developed based on existing SCM knowledge (Initiated or adopted from literature review and pervious research works of Vikas Chandra (India-IIT, 1999)[30], viii Ato Abreham Debebe (Ethiopia-AAU, 2004)[8], and others recently done on similar area and as result of the circulated questionnaires, interviews made, and the results of an assessment or observations of supply chain management in the Mesfin Industrial Engineering PLC. While the case study was conducted, MIE’s awareness of SCMS, existing measurement of costs, all the inputs from the supply side, the production process and the out puts were assessed. Consequently, a supply chain model is developed with modifications on the existing model in such a way that non-value adding activities are avoided to reduce the supply chain cost. Thus, based on the new model, supply chain cost analysis is done and when compared to the traditional accounting system cost analysis there is a reduction (saving) of about Birr 1,235,743.80 (1.06%) in the annual production cost when supply chain cost analysis is used. Finally, the researcher has made conclusions of the study and put recommendations to the industry, MIE, on how to use the concept of SCMS for creating satisfied customer and enhancing its profit margin. Keywords: Supply Chain Management System (SCMS), Supply Chain Cost Analysis, Supply System (direct and indirect materials), Manufacturing System, Distribution System (Dealer & Branch Warehouse), Modeling, and Material Flow System.enSupply Chain Management System (SCMS); Supply Chain Cost Analysis; Supply System (direct and indirect materials); Manufacturing System; Distribution System (Dealer & Branch Warehouse); Modeling; and Material Flow SystemThesis