Uncategorizedmario ruiz on 30 Aug 2007 06:07 am
This quarter Harvard Business Review brings an article by Reuben E. Slone, John T. Mentzer, and J. Paul Dittmann about Supply Chain Management. There is a section covering the technological approaches of this area. Its summary could be read something like the following.
- The warehouses of many large companies still operate with 20-year-old technology.
- Supply chains today are often densely complex, only well managed with people, technology and methodology, where the CEO should take the time to understand, because (s)he can play the role by challenging the business case for technology adoption.
- Today’s software enabled companies to optimize distribution and production planning, inventory management, warehousing, and transportation systems.
- With the used of of RFID (radio frequency identification) chips and systems, the system allows for real-time access to demand plans, inventory levels, and the transportation status of various different deliveries—information that in turn can be coordinated with demands from supply chain customers and inbound materials from supply chain providers.
- Powerful process tools such as Lean and Six Sigma are now being applied to the entire supply chain. WE should be cautious in this approaches.
- There must be security considerations at the systems with roles and profiles to have anyone a read-only access, but only selected individuals have the rights to make changes to forecasts, plans, and deliveries.
- These systems, can be fully exploited as a competitive tool to deliver product faster and cheaper than rivals’ supply chains do. In essence, sharing information with supply chain partners creates breakthrough improvements in performance.
on 30 Aug 2007 at 4:31 pm # Charlie
Hey Mario.
And what would be the best SCM software?
Charlie
on 30 Aug 2007 at 4:33 pm # Bill
Sometimes I wonder if the cost is worth the benefit, not only for the licenses but also for the cultural change we go into the company.
It is very difficult to get it up and running. Major surgery on the company. Maybe open heart.
Bill
on 30 Aug 2007 at 4:37 pm # Bill Jung
Bill, I run a big company I went into the “open heart surgery” as you call it. At the beginning we do not see the light at the end of the tunnel.
This is a project of at least 3 years to see the return. But once you get over there, you just do not see how you could make it without it.
Bill
on 31 Aug 2007 at 2:28 pm # Anand
Most of this seems to be what I have studied academically. In my internship at one of the famous FMCG companies here though, I realized that none of the state-of-the-art technologies including RFID are put to use, if your competition does not use it.
Basically, at the end of the day, it is the costs incurred that matter, and if you can keep your costs low with century old techniques, then so be it..but just make sure that your competitor is also on status-quo..
on 31 Aug 2007 at 2:41 pm # mario ruiz
Anand: It is based on an article written by a person in the academia. What can we expect…
The cost you talk about, is the cost of the system of the cost or savings that the system produce?
Bill Jung: Your name seems Swiss. The problem with the long run is that not every company seems to have the savings. What is very sure is the investment.
Mario
on 31 Aug 2007 at 10:20 pm # Anand
Mario, its both. While on one hand, companies try to cut costs from existing processes, the technology that they use is most often based on the minimum cost incurred (taking into factor what the competitors use…)