Supply Chain Management Common Learning Block II Copyright © 2015 Mc. Graw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of Mc. Graw-Hill Education.
Role of Supply Chain Technology • To Provide Visibility and Transparency of Movements within the Supply Chain • Provides an Enabling Role in Today’s Complex Supply Chain • Timely Updates • Leads to Successful Customer Management LO 1 13 -2
Systems and Technology Overview • Computer Technology Evolved in the last 65 years • Since early 1970’s – Modern Technology • • • LO 1 Computer Chips Initially, systems were Silo-based Created redundancy Added to company’s labor costs Inconsistency in information recorded 13 -3
Systems and Technology Overview • Common Notes in silo-based systems: • “I thought computers were supposed to make things easier”. • “We keep adding people just to keep it running”. • “How much inventory do we have? ” • “Based on which system? ” LO 2 13 -4
Systems and Technology Overview • Computer systems that are not integrated can lead to: • Different data / Lack of Updates / Excess Labor / Mistrust of the Information / & Bad Decision-Making • Departmental Software addressing the needs of specific departments does not take full advantage of modern technology LO 3 13 -5
Systems and Technology Overview • Corporations now realize the benefits of accurate and Single-Source Information • Real Financial Benefit of Computerization is: • Cross-functional • Serving many departments • Using few systems • Technology has enabled multiple departments such as Manufacturing, Purchasing, & Marketing to access the same data from a single source LO 4 13 -6
Corporate-Wide Supply Chain Technology Enablers • ERP (Enterprise Resource Plan) –Manages the LO 5 entire corporate enterprise • Controls transactions like sales & ordering • Manages the General Ledger • Manages Financial Tracking • ERP is an integrated system • Entire organization gets common information • Transaction updates system-wide 13 -7
Benefits of Technology in Supply Chain Management • Optimize Performance • Identify New Opportunities • Supply Chain Management, its systems, processes and controls are necessities in global commerce • Supply Chain Management is an opportunity center to maintain and improve performance while containing and reducing costs. LO 5 13 -8
Types of Supply Chain Operational Technologies • Supply Chains are now global and can be • • LO 6 divided into four primary categories: Decision Support Systems (Network Design/Transportation Mgmt. Systems) Communications Technology (EDI/Internet/Satellites/Fiber Optic Cables) Processing Technology (CAD/Automated Storage & Retrieval/Radio Frequency) Integrative Technology (ERP/CRM) 13 -9
Technology Selection and Implementation • System Implementation is Optimal for Labor and Data Entry • Various Systems should be thought of as stand -alone or modules of integrated systems • Each decision about implementing new systems should be evaluated on whether to use best in class or integrated modules LO 7 13 -10
Selecting The System You Need • Determine Needs, Requirements, and Wants • U. S. Economic Recession of the 1980’s • Global Competition (China) • Create a Scorecard (Identifying requirements and assigning proportionate value) • Test all requirements against various systems and rank accordingly LO 7 13 -11
Evaluating & Buying A System • Define Requirements – Industry Type / Wish List / Scalability / Stability of Vendor / Costs • Weighted Scorecard defines the comparative value of the requirements • See Example on Page 15 LO 7 13 -12
Evaluating and Buying A System • Absolute Requirements • Weighted Scorecard is a valuable tool in industry for making valuable evaluations in selecting from multiple choices LO 8 13 -13
Steps to Purchasing Software • Define Needs and Requirements • Develop a Weighted Scorecard • Vendors should demonstrate the requirements in the scorecard • If a vendors system does not meet your absolute requirements, they should not bother demonstrating their product/service • Can help firms obtain economies of scale LO 8 13 -14
Steps to Purchasing Software • Get top management buy-in to ensure successful implementation • Get endorsement from workers • Ensure proper budgeting to include: • Set-up • Training • Testing • Support LO 8 13 -15
Supply Chain Technology Trends • • • LO 9 Bar Code Printing & Scanning QR Code Radio Frequency Identification Drones Data Analytics Cloud Computing 13 -16
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