Supply Chain Management System: A Profitability Tool

2007-03-08 10:33:40

( Computers )



The competitive ability of companies depends on their capability to deliver to customers the products they want, in a quick and timely fashion. This requires you to create multiple relationships based on trust and long-term needs not only with your customers but also with suppliers and other strategic partners, which means you must have a responsive supply chain management system.

Whether your company runs global supply chain management or local retail supply chain management networks, you need effective supply chain management systems to help you manage this complexity. There is only one overriding objective for any supply chain management system: profitability for the enterprise. And your supply chain management solutions must help you determine where to find and how to create opportunities for profitability.

Use of technology among companies may differ. You may opt to use external supply chain management solutions, while others may utilize mainly internal resources. Another company may use a combination of both. But, as in any deployment of technology, you must possess complete determination to make the technology work and improve your business.

Some companies organize dedicated technology teams to help manage the deployment of supply chain management solutions across their company. Their primary concern is database integration, in order to generate more comprehensive information; the target is usually to have one master database for the whole company instead of having several scattered databases throughout the whole supply chain management system.

In managing the cost of materials procurement, supply chain management systems also need to include strategic elements other than price alone. You can require that your company will deploy solutions that allow your suppliers to include in their bids such supply considerations as delivery time, quality of product, and supplier's after-sales services. Your supply chain management system thus signals your buyers that you want best price along with best value from each supplier.


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