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The Value of information in SCM

Prof: Sham Choughule

Supply Chain Management is a broad based function which encompasses all business and operational processes involved in but not limited to Procurement, Manufacturing, and Finished Goods Transportation, warehousing & Distribution and Inventory Management.

In a globalized business scenario characterized by Geographically spread markets, raw material procurement sources across the world and cheaper manufacturing and labor markets being available in developing world, the business of meeting demand with supply is constantly changing and evolving.

Importance of Information
The vary essence of SCM is effective information and material flows through out the network of Inbound & out bound logistics This (e-SCM) can help to improve productivity Reduce cost and efficient customer service This is one of the driver of SCM

Inbound & Out Bound logistics

India Inbound Logistics


Out bound logistics


Wholesaler Retailer End user

Import of Raw material

Export of Finish product

Information flows is required from start to end in Logistics/SCM

Logistic efficiency and effective supply chain management gives you a competitive advantage by delivering both cost reduction and service enhancement IT helps to achieve above

Production side
How many raw material available When it will be shipped ? Inventory in transit Inventory available at factory Without this information, factory manager unable to prepare production plan

Marketing side
Manager should know Customers requirement /wants How much inventory is available in stock When finish product will move from factory What is transit time? Without this information he cannot make his plan and give response to customer He also cannot make his marketing strategy

Importance of information
Information flows make the SCM visible to Manager enable to take him appropriate decision Data and analysis regarding inventory transportation facilities-throughout SCM allows SCM to become more efficient and more responsive Therefore, this is one of effective driver of SCM

Characteristics of information
Information must be accurate Information must be accessible in timely manner Information must be in right form Example data Walmart has been not pioneer only to gather information but also to analysis it to make good SCM

I T & Logistics
Today integrating logistics into corporate strategy is widely recognized as a means to reducing costs, entering markets and creating customer service, The I T is one of the tool of efficient logistics/SCM

IT Tools in logistics
e-procurement Andhra Pradesh Trading Corporation Northern railway http//www.nrels.com Now many companies uses IT solution for procurement on line Example Global tender of MMTC or STC

I T in Transport
VTS Vechicle tracing system GPS Global Positioning System for road transport Reliance Logistics is using this system to monitor their 2500 trucks for door to door service RIFD Radio Frequency Identification Railway is planning to use this to trace their wagon or container distress enroute

Indian railway is planning to spend INR 5000 crore for IT in rail transport

RFID & Logistics

Radio Frequency Identification (RFID) tagging is now mandated by the department of defense and many of the world's largest retailers including WalMart. In order to stay competitive, more than 200,000 manufacturers and suppliers must develop strategies for integrating RFID technologies into their supply chains.

I T in Shipping
Every shipping company use their website for container tracking Container can trace at any stage in movement Documents to be prepared on line Example WAN HAI LINE Mearsk line FOIS freight operations information system

I T in port
VTMS-Vessels Traffic Management System CTMS cargo Traffic Management system Web based container tracking system Example JNPT

I T in Customs
EDI System www.icegate.org >Filing shipping bill from office >filing bill of Entry All documentation based on website

IT Tools
Internet Mobile SMS container tracking ERP SAP SCM software Study of Fleet Management System Of trackon

Global business has been fuelled and enabled by the IT Technology which has redefined all aspects of business today. All businesses today are run on ERP - Enterprise Resource Planning which provides the organizations with tools to manage all the functions including procurement, production, sales and finance management in seamless and integrated manner.