Supply Chain

All facilities, functions, activities, associated with flow and transformation of goods and services from raw materials to customer, as well as the associated information flows An integrated group of processes to source, make, and deliver products

Supply Chain Processes

Supply Chain Management (SCM)

Managing flow of information through supply chain in order to attain the level of

synchronization that will make it more responsive to customer needs while lowering costs Keys to effective SCM

information communication cooperation trust

Role of Information Technology in a Supply Chain

Information is the driver that serves as the glue to create a

coordinated supply chain Information must have the following characteristics to be useful: Accurate Accessible in a timely manner Information must be of the right kind Information provides the basis for supply chain management decisions Inventory Transportation

Use of Information in a Supply Chain

Information used at all phases of decision making:

strategic, planning, operational Examples:

Strategic: location decisions
Operational: what products will be produced during

todays production run

Information Technology: A Supply Chain Enabler

Information links all aspects of

supply chain E-business

Bar code and point-of-sale

data creates an instantaneous

computer record of a sale

replacement of physical

Radio frequency identification

business processes with electronic ones

(RFID)

Electronic data interchange

technology can send product

(EDI)

data from an item to a reader via radio waves communicate with suppliers, customers, shippers and other businesses around the world, instantaneously

a computer-to-computer

exchange of business documents

Internet allows companies to

E-business and Supply Chain

Cost savings and price reductions Reduction or elimination of the role of intermediaries Shortening supply chain response and transaction times Gaining a wider presence and increased visibility for companies Greater choices and more information for customers

Relationship between Facilities and Functions along the Wal-Mart Supply Chain

Source: Adapted from Garrison Wieland for Wal-Marts Supply Chain, Harvard Business Review 70(2; MarchApril 1992), pp. 6071.

Amazon.com

SCM Software
Enterprise Resource Planning (ERP) software that integrates components of a company by sharing and organizing information and data SAP was first ERP software

Linking Supply Chain with SAP