When you hear the word supply chain, you may experience a variety of emotions. Recent disruptions in the global supply chain have lead to crowded ports, part shortages, and delayed deliveries. In this article, we’ll walk through the basics of supply chain management, and discuss the technology solutions that can help.
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What Is Supply Chain Management?
Supply chain management (SCM) is the organization of resources as they move from point of origin to end consumer. It refers to the various processes involved in transportation, order processing, warehousing, inventory control, product planning, and production management.
A supply chain is a channel that brings a good or service from the producer to the consumer. A business’s supply chain can be either complete — comprising all the links from raw material to end customer — or partial.
SCM is the organization of resources as they move from point of origin to end consumer.
Businesses that follow sound supply chain principles have an advantage over others that don’t. For example, they can maintain product quality, charge competitive prices, and provide high levels of customer satisfaction.
Further, a well-managed supply chain may considerably lower a company’s operational expenses, resulting in higher profits. Finding small efficiencies in any step of the process, from concept to end product, can create huge savings overall.
The SCM process incorporates all the different tasks, policies, and controls of the supply chain. This process is usually understood as the coordination, interaction, integration, planning, design, control, and monitoring of activities along the various supply stages. The goal is to meet the customer’s demand while maximizing the efficiency of resource use.
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Impact of Technology on SCM
Supply Chain Management has gone through a lot of changes in the last few years. These changes are due to high competition in logistics, as well as globalization. Digital transformation has also contributed a lot in improving the way companies managed their supply chains.
It’s important for business owners today to understand the impact of technology on supply chain management, and how they can benefit from it. SCM software allows for real-time tracking and analysis, and makes this information available to all stakeholders in the supply chain; information is stored and disseminated in the cloud.
It has never been easier to share information with distributed businesses and consumers.
In addition, real-time traffic data impacts the shipping and receiving of parts for product manufacturing. Along the same line, the Internet of Things (IoT) and improved tracking software make it easier for users at the end of the supply chain to see the movement and handling of goods in production and distribution.
What’s more, innovations in supply chain tech have made driverless deliveries, smart road technology, and robotic warehouses more feasible and cost-efficient. All told, it has never been easier to share information with distributed businesses and consumers.
What are SCM Best Practices?
Supply chain management is a complicated endeavor. Here are the best ways to deal with it:
- Maintain clear communication throughout the supply chain.
- Invest in a diverse range of suppliers.
- Find a balance between cost-effectiveness and flexibility.
- Leverage digital transformation to improve efficiency.
- Ensure the supply chain is in sync with company goals.
Supply Chain Management Software
Your company will be more agile and capable of meeting consumer needs if you can use the proper supply chain management software. Consider how digital supply chain technology can improve your operations, depending on your industry:
- Oracle Supply Chain Management is appropriate for a wide spectrum of companies, from large corporations to small businesses.
- Vizient is ideal for pharmacies and health care institutions.
- SAP Supply Chain Management is best suited to companies that produce complex goods.
- ArrowStream is ideal for food service establishments.
- Magaya Supply Chain is the best option for transportation and logistics companies.
- iM3SCM is suitable for small and midsize businesses that need increased warehouse visibility.
- Logility is the best choice for consumer products and retail businesses.
SCM plays a vital role in the efficiency of any organization. When supply chain managers use collaboration tools, they can accomplish their goals more effectively and efficiently.
The greatest benefit of supply chain collaboration technology is the ability to accelerate processes and enable companies to make data-driven decisions in real time. By leveraging SCM technology, organizations can reduce costs and risks — which ultimately leads to success for companies across all industries.
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