With supply chain, the task is to manage a network of businesses. It works to ultimately provide service and product packages requested for by the end-user. Supply chain management (SCM) takes into account the entire storage and movement of raw materials, the inventory in progress, and directing finished products from beginning to the end. SCM covers planning and managing of all the processes; product identification, procurement, manufacturing, and logistics. It also takes care of collaborating and coordinating with its partners like suppliers, service providers, intermediaries, and customers.
However, SCM faces certain problems in executing its process. Distributing network configuration and identifying network mission are some issues. Access to numbers and locations of suppliers and production facilities are also pertinent worries. SCM has to prepare a distribution strategy, taking care of operating controls, delivery schemes and much more.
Technology as a solution
Before the 1980s, functional areas carried their information using paper, and it was indeed a slow process. Introduction of IT has allowed a competitive position for business initiatives. It has helped reduce cycle time and implement the redesigned processes to function across different verticals. A few instances:
- IT has actually made customer satisfaction a corporate obsession. It has become most critical to serve customers effectively, efficiently, and in best way for every enterprise.
- The work of IT has also been pivotal in helping managers reduce dependency on manual labor and inventories. They have been able to plan much more strategically after initiating information flow.
- Sharing information between partners is also very crucial in supply chain. These integrations are teamed up with IT initiatives like using bar codes for logistics, planning for materials requirement, solutions for enterprise resource planning (ERP), etc.
Reports have shown that electronic data interchange (EDI) for fixed delivery-time shipments reduce shipment faults and increase earnings. Almost all the channels in supply chain, including warehousing, planning are getting better with IT intervention.
Benefits of IT-enabled SCM in warehouse management
Receiving goods, allocating the locations for storage, replenishing locations from where goods have been picked, listing down the picking instructions, picking the orders, assembling orders, and rotation of stocks are functions enabled by SCM technology. There are certain systems used with communication equipment working on radio frequency. The equipment can be installed easily in forklift trucks. This system communicates with radio frequency and directly instructs staff about warehouse activities. The entire system can be automated and synced in a way that one activity gets directed to the next one automatically. Businesses can use this to update real-time goods storage.
Some extremely sophisticated processes in warehouses can also be made completely automated. The system might work on automated retrieval and storage, vehicles guided through automation, conveyors, sortation systems and other warehousing functions. Numerous computer models are getting devised to help warehouse configuration and designing. They are usually 3D simulation models, extremely sophisticated systems providing moving and graphic illustrations of the warehouse layout on computer monitors.
The growing trend of outsourcing, globalization, customization, and real-time pricing is intense. They actually force businesses to adopt technology-efficient and effective SCM policies and practices. Increasing customer expectations are making companies feel uncertain. They worry about their business environments with the competition intensified. Companies have to integrate their conventional SCM strategies to survive. They need to expand way beyond their confines to integrate every single stakeholder into the cycle. Warehousing challenges can be minimized with SCM technology handling time-sensitive warehouse management interactions.
Amy Jackson is a freelancer and has experience of over 7 years in supply chain optimization solutions, Supply chain optimization, and Analytics. She has been writing on supply chain planning, predictive analytics solutions, Procurement Service Provider solutions and other solutions. Follow her on Google+ and get to know about the latest business trends.