Supply chain management systems are integrated partnerships between all linkups in the flow of goods and services to the customer.
Basically it is implemented for the purpose of improving quality, reducing costs and achieving competitive advantage .In today’s world lean manufacturing and specialization compels companies to rely on one another for valuable productive activities mutually .
All supply chain activities like planning, sourcing, producing, delivering and providing returns, are managed jointly within an integrated supply chain to ensure the maximum use of shared and available resources.
Different components in supply chain management are:
A well-planned supply chain management system can be broken into three components:
1) Strategic component: The strategic component includes decisions related to the number, size and location of warehouses and the selection of supply chain partners. Product management and cooperative marketing strategies are also considered at this level. Technological infrastructure design and implementation is a large part of the strategic component and must be collaboratively carried out by all member companies
2) Tactical component: it basically encompasses the execution of strategic initiatives and start-ups. Partnership details are decoded at this level. Decisions related to inventory quality, quantity and location is taken, and benchmarks are to be created to analyse supply chain effectiveness and economic viability.
3) Operational component: Operational activities are activities which confirms and ensure that supply chain activities run smoothly and efficiently. Shipping and receiving activities, as well as purchase orders and demand forecasting, are a part of the operational component.
Unilever: Unilever is the third largest consumer goods company which have great chain of food beverages, personal hygiene care products. As the unilever began its fiver year growth strategy in year 2000 which target for complete restructuring of supply management. They focused on organization, global procurement processes, supply chain executives, supplier involvement, and technology. As a result, they achieved $14.24 billion in savings in 2003 from its initiatives, and Unilever became a leader in the consumer packaged industry for technology adoption.
Some of the positive points of IT enabled services (information system) are:?
IT is comparatively less capital intensive
It is environmental friendly and clean
It is not location specific and can be undertaken from anywhere.?
It does not require expensive infrastructure facilities
Various IT solutions
Electronic mail (e-mail),
Electronic data interchange (EDI) ,
Enterprise resource planning (ERP)
Results of IT solution it is observed that the Indian retail industry is booming and internet is being utilized in automobile industry in a big way. Internet trying to interlink suppliers, manufacturers, wholesalers and retailers to have better control on inventory at various levels of supply chain including better utilization of manpower and also keeping track of inventory.
But it is fact that internet has influenced the whole business strategy whether it is policy or it is physical implementation. Some of the areas where’s greater effect felt are given below: a) Communication b) Selection of vendors or partners c) Cost saving) Reduction of lead times e) Improves product promotional activities.
24 hours communication throughout the year all over the world. Because of internet communication are saving in manpower, stationary, postage and journey fare. Quick exchange of ideas and expertise,
Customer’s feedback collection becomes easier
Selection of vendors or partners
Suitable vendor selection from many vendors from any part of the world
There are also some limitations observed:
1) Lack of manager awareness with the system and lack of management’s full commitments.
2) Development of electronic data interchange is a costly affair
3) Problems of security and privacy
4) Since no face to face contact is there hence, lack of trust
5) Customers also need awareness for effective utilization of internet in the
Future IT trends
In today’s highly competitive marketplace, it’s imperative for businesses to innovate new ways to streamline their supply chain and optimize productivity. With the aid of modern technologies, you can create better visibility within your supply chain, which will enable you to have more control over your business and stay ahead of the competition. Technology can help to simplify your supply chain management, which will enable your business to operate more efficiently, give you more visibility and control over your inventory, and help to reduce your operational costs. Additionally, through a more stable and efficient supply chain, you can greatly enhance customer satisfaction and retention. Here are just a few ways to integrate modern technologies into your business model and improve your supply chain management
1. Computerised shipping and tracking
In today’s high technology era, where everything is internet based software has been explicitly been used to reduce shipping errors and speed up the whole process of supply chain management. Software like flash View enables savvy business personals to accumulate all the information at one common. Software tools allows complete data to be store in a digital way like for inventory, monitoring shipping information and tracking the product and consignment also generating E-invoice with ease. Through the use of supply chain management technologies, one can easily save time for shipping in receiving you can greatly reduce the time spent shipping, receiving, tracking, and compiling order data, which will save company both time and money.
Flash view improves the overall operational efficiency of supply chain and greatly enhances the customer satisfaction through continuous tracking system. Chances of occurring error get reduced at great extent and overall system becomes smooth and consumer friendly.
2) Radio Frequency Identification (RFID)
It is a advanced technology which can provide good benefits and tracking to the organisation. RFID chips are located and fixed on the company products to provide their exact tracking location say for inventory. RFID chips will immediately detect and inform if any anomaly or mistake has happened to correct it on time before loss or damage
Most importantly it allows business owners to track and enable business owners to have clarity on goods and products all the time from anywhere. Hence installing RFID drastically reduces cost and time to efficiently
Since whole world is connected through internet, it becomes easier to select business partners for the joint venture
Cost saving for example Reduce cost of preparing letters and sending letters,
Achieving order and placing order has become easy and less costly
Reduce lead time of material supply
Reduce retrieval time of documented information
Improves product promotional activities
Reduce the expenditure for market expansion and also reduce market mediation
Improve relation with customer