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February 9th, 2012

Posted on February 9th, 2012, 4:23

To explain in a simple way, supply chain management (SCM) deals with the facilities and distribution choices that help in procuring materials, converting them into finished or intermediate products, and also disseminating the final goods to users. Whether an organization is manufacturing or service oriented one, supply chains are present and the complexity differ from one firm to the other firm.

Conventionally, distribution, marketing, manufacturing, planning and purchasing organizations have their customized supply chain systems and lead to certain internal conflicts. For instance, the manufacturing concerns are set up in a way that it increases the output and minimize the expenses keeping a little consideration for the influence on distribution capacities and inventory levels. Similarly, purchasing contracts are generally negotiated with very less data apart from historical purchasing patterns. Hence there is a requirement for a method that would incorporate all these different functions together. Supply chain management solutions are the medium through which this integration can be attained.

Today, there are eminent service providers of supply chain management solutions that results in numerous cost advantages through the Alfa Level. Some of them are as follows:-
  • Minimized logistics expenses by 30% with the help of order and shipment consolidation
  • Minimized logistics management staff globally by 70%
  • Results in automated processing of 90% of orders and even more
  • Minimized the count of warehouses from 70 to 3
  • Minimized stock by 30%
  • Helps in attaining real-time visibility into ongoing order fulfillment logistics flow
  • Minimized transport invoice expenses through an improved control of carriers’ invoices
  • Minimized environmental impact through lesser locations and improved shipment consolidation

Service providers today make use of the innovative Cloud Process and offers innovative order management system which allows the users to view whatever is taking place in the flow. This leads to better effective logistics planning and consolidation, as well as intervening with the appropriate measures as and when it is required.

Supply chain management solutions is generally taken as a medium that operates between vertically integrated firms, where the total material flow is supervised by one firm as well as those where every channel partner functions independently. Hence, a co-ordination between the different players in the chain is what leads to success. Cooper and Ellram have compared an effective supply chain management to a balanced relay team that is competitive. Along with other innovative features, service providers of SCM also specialize in efficient purchase order software.

Click here to read more on - what is a value, eprocurement

By Josephmax, in: General