E- SUPPLY CHAIN MANAGEMENT

RAHUL GUPTABBA

GALGOTIAS UNIVERSITY

PGDM/2013-15/ II Trimester/E-Business

What is supply chain management? Supply chain management is the co-

ordination of entities, activities, information and resources involved in moving a product or service from supplier to customer; where entities consist of manufacturers, service providers, distributors and retail outlets.

What is e-supply chain management?

When the co-ordination for managing the supply chain takes place by using Internet technologies it is known as e-supply chain management.

Inter-enterprise integration is a major focus of e-supply chain management.

Inter-enterprise Integration and Types of Supply Chain

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Types of supply chain for inter-enterprise integration

Responsive: This kind of supply chain responds quickly and accurately to customer’s needs. ATP(available to promise) is an important feature of this responsiveness. ATP systems provide real-time integrated checks throughout the entire supply chain.

Adaptive: This kind of supply chain can rapidly be reconfigured to adapt to changing consumer demand. Adaptive supply chain helps the companies to respond to changing business conditions and consumer requirement.

Intelligent: It is a dynamic kind of supply chain and continuously fine-tuned to perform well.

E-Supply Chain Planning

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Major components of e-supply chain Advanced scheduling and manufacturing

planning: It provides detail co-ordination of all manufacturing and supply efforts based on individual customer orders. Scheduling is based on real-time analysis of changing constraints throughout the process, from equipment malfunctioning to supply interruptions. Scheduling also creates job schedules for managing the manufacturing process as well as logistics.

Demand forecasting: This module supports a range of statistical tools and business forecasting techniques. It takes into account changing market scenarios and economic factors while making decisions.

Transportation planning: This programme facilitates resource allocation and execution to ensure that materials and finished goods are delivered at the right time and at the right place, according to the planning schedule at a minimal cost. It considers such variable as transportation mode like railways, trucks, airlines, and availability of each mode.

Distribution planning: This is integrated with demand forecasting, manufacturing schedule and transportation planning to reach the customer. This module addresses customer-specified requirements.

Order commitment: It is a system that allows vendors to accurately quote delivery dates to customers by providing real-time detailed visibility into the entire fulfillment cycle. Order commitment is linked to all other modules so that accurate delivery of goods and services can be guaranteed.

E-supply chain fusion

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What is E-supply chain fusion?

Process of e-supply chain fusion involves the migration from existing non-integrated supply chain to more effective integrated supply chain and thereby creating a tightly woven supply chain.

Four stages of supply chain fusion Stage I - Information sharing: Well-

established and effective communication channel is required at the 1st stage. For example, the consumers can interact effectively with the entire enterprise from a single store or Website.

Stage II – Joint performance measurement: Key challenges include creating performance measurement and developing a clear understanding of the costs and benefits involved in supply chain integration. Collaborative planning processes are created in this stage.

Stage III – Realignment of work: Through the process of collaboration decision-making is decentralized and work load is shared among the enterprises.

Stage IV – Redesigning products and processes: Products are processes are redesigned so that work becomes easier and more efficient. A major challenge is to include the entire supply chain in the interenterprise process reengineering efforts.

Management issues in e-supply chain fusion 1. Determining the right e-supply

chain structure: Need for cost-efficiency does not permit to maintain a large inventory of finished products for the customers. Market demands may change and the price-structure may also undergo changes. For this reason, it is important to maintain the right kind of e-supply chain structure to ensure right product at the right time.

2. Enabling effective differentiation capabilities: Organizations develop strategies for competitive differentiation, offering customers something unique that the competition does not have. Differentiation is in terms of products and services and also in terms of performance standard. Build-to order(BTO) business models are used for this purpose.

3. Facilitating effective order-fulfillment capabilities: Accurate order-fulfillment is challenging and offers a great opportunity for reducing costs and improving customer service simultaneously. An integrated supply chain is critical to order fulfillment. Effective supply chain management configures the chain to respond to order.

4. Determining the right infrastructure capabilities: Creation of a real-time supply chain management infrastructure is a major task for an organization. Planning, selection and implementation of SCM solutions is becoming more complex with the change of technology and with the increase of the number of business partners of a company.

END of Session 1

ASHIS MITRA, IT DEPT, B.COM ST. XAVIER'S COLLEGE