Supply Chain Management

Group 8

Ian Carr, Clay Garrison, Chris Lemley, Al Suarez, and Amanda Williams

Key Words: Electronic cash, Electronic wallet, Electronic data interchange

Supply chain management is the route of planning, implementing, and controlling the work of the supply chain with the intention of taking care of each and every customer. Supply chain management covers all movement and storage of raw material going through work-in-process into finished good. This is done in the point-of-origin and the point-of-consumption point of view. Supply chain management benefits a business greatly in that it deals with suppliers, intermediaries, third-party providers, and customers to incur the least amount of cost to produce the greatest amount of profit.

Businesses win or lose due to their supply chain management. As consumers demand more and better quality products, the supply chain management must continue to perform cost reductions, quicker deliveries, and better performance of their products. A business can greatly benefit from cost saving; and manufacturing improvements can be enormous. Making a product more efficient and of better quality will cause a higher demand. The impact on your margins and bottom line is considerable. With the help of suppliers’ support, major improvements can be accomplished in only a short time.

To achieve faster deliveries and reduce cost, a good way to move product down the line is to use electronic cash. Electronic cash is the electronic representation of cash. Another type of quick response in the money exchanging part of the deal would be to use an electronic check. An electronic check is a mechanism for sending money from your checking or savings account to another person or organization. Both of these methods are time saving processes. With electronic payments suppliers sometime offer greater discounts on products purchased, because it saves a company’s interest. Time is money, and without this company's quick method of payment to its supplier, time would be wasted - and so would money.

Another way to save time in transactions is to use electronic data interchange. “Electronic data interchange is the direct computer-to-computer transfer of transaction information contained in standard business documents, such as invoices and purchase orders, in a standard format.” Think about the amount of time it would take to write down all the process and where exactly things are in the production line. Take Wal-Mart for example it would pay more for salaries for the tracking of goods, rather than buy an electronic data interchange.

Capturing these financial skills in today’s world is to a business a great benefit. Economically, it is important for a business to encompass the needs and wants of a consumer - the supply and demand. Businesses have cut back the actual number of employees dealing directly with the suppliers. Business time and capabilities are stretched to the limit, although you still must meet customers’ demand on lower prices and higher expectations.

An organization is greatly affected by supply chain management. Supply chain management is responsible for its suppliers getting the raw materials to the manufactures. If a business is backed up with raw material and has not moved on to work-in-process, then finished goods will not be produced and raw material will stock pile.

Without supply chain management businesses can suffer from product shortages, or overstocked warehouses. The responsibility of supply chain management is to make sure a business has enough products to meet the needs of each and every person. Its job is to look at the economy and see if its product is being bought and at what rate. If a product is not being bought, and all of a sudden it runs out, it does not mean that a company should go out and get ready for it to keep booming. A business should look at the reasons why it is selling now. For example, if you had a rain jacket that was doing well in the market and then stopped selling, a company would typically put it on sale, and it would quickly sale. This would not be the time to call the raw material manufacturer and ask for a speedy delivery for more rain jackets.

An example of a supply chain management is Logility Voyager Solutions. Logility is a leading provider of collaborative solutions to optimize the supply chain. Logility has three parts associated with its business: Voyager Manufacturing Planning, Voyager Replenishment Planning, and Voyager Supply Planning. Voyager Manufacturing Planning can help locate capacity and material exceptions, reduce cost for customers, and anticipate problems and find alternate routes to avoid these problems. Voyager Replenishment Planning makes a quicker response to demand in the marketplace, faster orders and delivery, and support for continuous replenishment strategies such as VMI and Efficient Consumer Response. Voyager Supply Planning quickly creates an optimal plan, displays a complex supply network for the whole supply chain, and creates a comprehensive look at revenue and cost.

As technology improves and customers demand better products in a quicker amount of time supply chain management will continue to be vital in the success of any business. Since supply chain management involves everyone related to the business from supplier to the customer it is important that the process is efficient. Our economic environment is changing. Today’s businesses are continually trying to position themselves for the future. Businesses will have to use new techniques than those used in the past. A new set of rules are required for the leaders of their companies. The implementation of software with regard to supply chain management is now essential in today’s changing environment. Most companies need to track demand, supply, manufacturing status, logistics, and distribution. They also need to share data with supply chain partners at an ever increasing rate. So many companies are buying many different types of supply chain software and integrating them together to support the specific needs of their companies. It should be noted that while technology is making things much easier for those managing the supply chain, without good information the business is not optimizing its resources. You are only as good as your information, so knowledge workers in the future must be capable of properly utilizing supply chain management software, and understand its importance to the company as a whole. The implementation of supply chain software, and having the right people to manage the systems will be the blueprint for success in the future for businesses looking to maximize their use of resources, and ultimately their profit margins as well.

References

Ayers, J.B. (24 April 2006). A Primer On Supply Chain Management [On-line]. Available http://www.ayers-consulting.com/scm-articles.htm

Cummings, M., & Haag, S. (2006). Information Systems Essentials. New York: McGraw-Hill/Irwin.

Wikipedia: The Free Encyclopedia. (20 April 2006). Supply chain management [On-line]. Available www.http://en.wikipedia.org/wiki/Supply_Chain_Management