INTEGRATED SUPPLY CHAIN MANAGEMENT IN THE GOVERNMENT ENVIRONMENT

R.K. Gupta* and Pravin C andra**

ABSTRACT
With the fall of East European Socialist-Bloc and opening up of the Asian markets, the trade barriers began falling during the 1980 s and continued throughout the 1990 s! "his de#elopment lead to organi$ations ha#ing a suppl% chain, that criss-crossed the &hole globe! "he proliferation of trade agreements has thus changed the global business scenarios! "he 'ntegrated Suppl% (hain )anagement *'S()+ is no& not onl% a problem of integrated logistics *as a process+ but also demands that the suppl% chain management *S()+ must look into the ramifications of these arrangements on the cost of transportation *including tariffs or duties+ of products &ithin a trade $one and outside it, besides, de#eloping logistics strategies! "he field has thus de#eloped in the last fe& %ears for bridging the gap bet&een demand and suppl% #is-,-#is efficienc% and cost trade-offs! "he S() no& not onl% in#ol#es the -management of logistic function., as &as done in the past *to achie#e internal efficienc% of operations+ but, includes the management and co-ordination of acti#ities, upstream and do&nstream linkage*s+ in the suppl% chain! "he integrated suppl% chain management, in particular include / 0lanning and )anaging suppl% and demand1 Warehouse )anagement1 2ptimal 'n#entor% control1 "ransportation and 3istribution, 3eli#er% and customer s delight follo&ing the basic principles of suppl% chain management #i$! &orking together1 Enhancing re#enue1 (ost control1 Assets utili$ation besides, customer s satisfaction! "he last t&o decade has seen the rise of a plethora of acron%ms al&a%s used in con4unction &ith production, operational management and control! "o name a fe& 5'" *5ust-'n-"ime+1 "6) *"otal-6ualit%)anagement+1 7' *7ero-'n#entor%+1 E(8 *Efficient (onsumer 8esponse+1 9)' *9endor )anaged 'n#entor%+! All these ha#e no& been integrated &ithin the domain of Suppl% (hain )anagement 0rocess! With the gro&th in the 'nformation "echnolog% and eas% accessibilit% of computing po&er, "he de#elopment and implementation of ob4ecti#e based modelling s%stem*s+ ha#e been changed to a ne& en#ironment, for integrating :uantitati#e and simulation models, as a backend s%stem for both hori$ontall% di#ersified and #erticall% integrated Suppl% (hain )anagement S%stem*s+! "hough, the S() ha#e found the #ersatilit% of applications, more so in the pri#ate sector enterprises *business en#ironment+ for cost cutting and for ha#ing a competiti#e ad#antage! 'n the go#ernment set-up though the basic ob4ecti#e, is not ma;imi$ation of profit, but the social-economic de#elopment of people! E#en, if the ob4ecti#es of these t&o mutuall% e;clusi#e categories of enterprises, are different, the% share some features/ Satisf%ing the end-consumer*s+ b% pro#iding the right product, in right condition at the right time to fulfil the social obligation to&ards societ%! "he optimum allocation of limited resources! "hus, the S() has man% applications in the go#ernment en#ironment too! "he paper highlights some of the t%pical applications in the go#ernment sector of the S() paradigm! What is essential in the S() is to establish operationall% feasible link*s+ bet&een #arious ke% component for achie#ing o#erall efficienc% and cost trade-off! "he use of :uantitati#e methods in S() is e#aluated, embedding of these models in 3ecision Support S%stem *3SS+ ha#e been discussed! "he ma4or component of S() is multi-ob4ecti#e transportation and distribution function for time and cost trade-off! "he )ultiple (riterion 3ecision )aking *)(3)+ model for the component of S() #i$! "ransportation and 3istribution, s%stem as a 3SS ha#e been described in detail - a ma4or backend s%stem of 'ntegrated Suppl% (hain )anagement process *'S()0+!
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Senior "echnical 3irector and =ead, Anal%tics and )odelling 3i#ision, >ational 'nformatics (entre, ?A Block, (@2, Aodhi 8oad, >! 3elhi - 1100B, "el! / CBDEFB0 *2+ CDGE88F *8+ Email / rkgHhub!nic!in 2r guptaHamdi#!delhi!nic!in )!"ech! "rainee at >'( during 5une-3ecember 199G, and at present Assistant 0rofessor *'nformation "echnolog%+, Aal Bahadur Shastri 'nstitute of )anagement, Shastri Sadan, Sector - ''', 8!I!0uram, >!3elhi - 1100EE, "el! D1GEC0G *2+ 91-FBE9G1 *8+ Email / lbsimHdelnet!ren!nic!in

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Introduction
Suppl% (hain )anagement *S()+ can be best described as the natural e;tension of the do&nsi$ing *right-si$ing+ and re-engineering performed b% the organi$ation*s+ in the past! 3o&nsi$ing and re-engineering transformed the enterprises into -lean and mean competiti#e units., b% cost cutting and process simplifications! "hese operations *of do&nsi$ing and reengineering+ in#ol#ed the -optimi$ation. *in terms of the number of persons in#ol#ed, the time taken, the comple;it% of the &ork etc!+ of business -units. *functional andJor administrati#e domains+ o#er &hich the organi$ations had full control! "hese strategies did lead to increased producti#it% and profitabilit% of the organi$ations but as the benefits of these le#elled off, it &as reali$ed that the approach to the &a% organi$ations &ork needed to be changed! "he abo#e changes &ere a b%-product of the -isolationist. *closed s%stem+ &orld picture of the enterprises in#ol#ed in the full #alue chain1 &ith organi$ations *the s%stem+ tr%ing to sur#i#e in an hostile en#ironment1 assuming that all other participants in the #alue chain &ere ad#ersaries &ith &hom the organi$ation must compete, e#en though the operations performed b% the separate organi$ations ma% be supplementar% in nature rather than complementar%! "he reali$ation that this &orld picture &as an impediment to the gro&th of organi$ations prompted the enterprises to start seeking -strategic alliances. &ith other organi$ations! "he formation of these alliances re:uired a basis *a common ground+ &hich &ould be acceptable to each and e#er% partner in the alliance! "his common basis isJ&as supplied b% the participation of the organi$ations in the #alue chain *the demand-suppl% chain+! "he participants in the chain, suppliers, sub-contract suppliers, inhouse product processes, transportation, distribution, &arehouses, and the end customer, generall%, perform mutuall% e;clusi#e tasks and thus do not compete directl% &ith each other! "he present paper e;plores the follo&ing issues/ "he need for suppl% chain management! "%pe of suppl% chain management model*s+ Krame&ork of the suppl% chain management model*s+! 'ssues in the design of suppl% chain management frame&ork!

6uantitati#e methods and suppl% chain management *S()+! 'nformation technolog% as a suppl% chain management enabler! 3esign of a )ultiple (riteria 3SS for transportation and distribution! 8ele#ance of the suppl% chain management paradigm to the go#ernment sector J publicsector enterprises!

Issues in SCM
A suppl% chain encompasses all the acti#ities, functions and facilities in#ol#ed in producing and deli#ering a product andJor ser#ice, from suppliers *and their suppliers+ to the customers! "he suppl% chain management *S()+ paradigm is geared to&ards optimi$ing each component of &hat used to be called *0roduction and+ 2perations management *production, &arehousing, in#entor%, transportation and distribution etc!+ and the inter-links bet&een these components s%nergisticall% LE1M! 'n the G0 s and the 80 s, #arious models for production and operations control and management &ere de#eloped / 5ust-'n-"ime *5'"+ 'n#entor% management model, 9endor )anaged 'n#entor% *9)'+ model, 7ero 'n#entor% *7'+ model, "otal 6ualit% )anagement *"6)+ etcL1M! "hese models focussed on the #arious components of the suppl% chain in isolation, this implies that these models &ere oriented to&ards the optimi$ation of a sub-part of the s%stem &hereas the S() paradigm aims at the optimi$ation of the full chain! "his leads to trade-offs among the different components of the suppl% chain! Kor e;ample, 5'" &ould re:uire a factor% to keep in#entories lo& and produce and distribute products in a timel% manner, ho&e#er 5'" ignores man% other aspects &hich cannot be seen independentl%, e!g! if the a#ailabilit% of the input materials is uncertain and irregular, the factor% ma% need to insure smooth and continuous production! Similarl%, regional stocking ma% permit reductions in transportation costs through increased shipment consolidation, as &ell as e;panded sales through better deli#er% performance! "hese impro#ements ma% be accomplished &ith onl% moderate increases in in#entor% and &arehousing cost*s+! =o&e#er, in an en#ironment &here different functional units manage the #arious logistics acti#ities independentl%, an organi$ation is less likel% to properl% anal%$e such important trade-offs!

!i". #$ % Int&rd&p&nd&n'& () *upp+, ' ain -it (t &r )un'ti(na+ d(.ain* in an &nt&rpri*&. )oreo#er, these models also ignore the interdependenc% of production and operations functions &ith other domains &ithin an organi$ation, such as marketing and finance! )arketing decisions ha#e serious impact on logistics function and #ice-#ersa! Kor e;ample, a marketing promotion campaign should be coordinated &ith production planning, since a higher demand ma% be e;pected! 2n the other hand, &hen ra& materials are cheap, or &hen the factor% temporaril% has an o#er-capacit%, the marketing department ma% decide to cut prices andJor start other promotion campaigns during these periods to increase demands! Also, financial decisions are dri#en b% production and logistics decisions! 0roduction of ne& products re:uire the in#estment in ra& materials and consume other change-o#er costs! Kinancial managers ha#e to be a&are of the increased demand for capital to finance the production plan! Aike&ise, the deli#er% of finished products generate financial income, so the forecast demand can be used to calculateJforecast the accounts pa%able and recei#able in the future! "he abo#e description means that production, finance and marketing decisions cannot be made independentl% *fig!1+! All these decisions are dri#en b% the acti#ities in the suppl% chain of a manufacturing compan% L1M! Kig!-1 sho&s a simple representation of the interdependence of the suppl% chain and the other functional domains in the organi$ation! "he links bet&een the *other+ functional domains - marketing, sales, human resources etc! - are not sho&n! "he linkage bet&een the suppl% chain components and the other functional domains relies hea#il% on information sharing to ha#e an effecti#e impact!

2ne other ma4or factor in the current scenario is the globali$ation of the suppl% chain! With the fall of the East-European socialist bloc and the opening of the Asian market, the trade barriers began falling in the 1980 s and the 90 s! "his lead to organi$ations ha#ing a suppl% chain that crisscrossed the globe! "he proliferation of trade agreements - E(, ASEA>, >AK"A, A0E(, etc! - has changed the global market! S() no& has become not onl% a problem of logistics but also demands that suppl% chain management must look into the ramifications of these agreements on the cost of transportation *including tariffs or duties+ of products &ithin a trade $one and outside itL1M! Kurthermore, organi$ations no& ackno&ledge that efficient consumer response *E(8+ can lead to competiti#e edge! S() is tantamount to coordinating all the operations of an organi$ation &ith the operations of the suppliers and customers! Effecti#e S() strategies are essential for successful implementation of E(8 programmes LEEM! "hus, a production planning and control model that focuses on all the aspects of the operations and distribution acti#ities and links &ith other functional domains such as finance and marketing is needed! "he suppl% chain management model should also perform the task of managing and coordinating acti#ities upstream and do&nstream in the suppl% chain! 2f course, such a model in its entiret% becomes #er% comple; and can not be used &ithout a sufficient computational infrastructure!

Supply-Demand Nexus
"o ha#e an effecti#e suppl% chain management frame&ork1 organi$ations must ha#e a clear understanding of the suppl% - demand ne;us and its implications for strateg% and implementation! "here is an interdependent relationship bet&een suppl% and demand1 organi$ations need to understand customer demand so that the% can manage it, create future demand and, of course, meet the le#el of desired customer satisfaction! 3emand defines the suppl% chain target, &hile suppl% side capabilities support, shape and sustain demand L1M! When one considers ho& tangentiall% marketing and operations area of an organi$ation t%picall% interact *in practice+, it becomes ob#ious that putting together the suppl%-demand can onl% occur

in the conte;t of o#erall perspecti#e! "he &ide gap bet&een the suppl% and demand sides of an organi$ation can onl% be bridged b% a comprehensi#e umbrella strateg%! "his can be done b% de#eloping a holistic strategic frame&ork that le#erages the generation and understanding of demand effecti#eness &ith suppl% efficienc%! Such a frame&ork pro#ides a strategic anchor to pre#ent the suppl% and demand components of a business from drifting apart! "he basis of such a holistic strateg% frame&ork is the integrated suppl% and demand model *Kig!E+! "he model is designed around t&o ke% principles! Kirst, in the present scenario &here #erticall% integrated suppl% chains *9'S(+ are a rarit%, if not non-e;istent1 organi$ations must bring a multi-enterprise #ie& to their suppl% chains! "he% must be capable of &orking co-operati#el% &ith other organi$ations in the chain rather than seeking to outdo them! Secondl%, the% must recogni$e the distinct suppl% and demand processes that must be integrated in order to gain the greatest #alue!

!i". #/ % T & Int&"rat&d D&.and#Supp+, M(d&+

Source: This model is based on the work done by Bill Copacino.[5]

"hus in#ol#ing three ke% elements / the core process of the suppl% and demand chains #ie&ed from a broad cross-enterprise #antage point rather than as discrete function! "o gain the ma;imum benefits, organi$ations need to identif% the core processes across the demand and suppl% chain, as &ell as e;ploring the impact of each of these processes on the different functions!

!i". #0 % Int&"ratin" pr('&**&* in t & *upp+, and d&.and ' ain*

Source : This model is based on the work done by Jeff Beech[
]

the integrating processes that create the links bet&een the suppl% and demand chains *fig B+! "his implies that the planning processes *&hich in#ol#es de#elopment of channel strategies, planning of manufacturing, in#entor%, distribution and transportation, demand planning and forecasting1 and marketing and promotional planning+ and ser#ice processes *&hich includes functions such as credit, order management, load planning, billing and collection, etc!+ must be integrated! "his integration must be done across the boundaries of the enterprises! 'f each participating organi$ation in the chain formulates its o&n plans on the basis of its o&n pri#ate information, then there is no &a% to integrate the suppl% and demand chain processes that the% share!

the supporting information technolog% *'"+ infrastructure that makes such integration possible! While information technolog% is needed to handle routine transactions in an efficient manner, it can also pla% the a critical role in facilitating the timel% sharing of planning, production and purchasing information1 capturing and anal%$ing production, distribution and sales data at ne&

le#els of detail and comple;it%! 'nformation technolog% pro#ides an integrating tools that makes it possible to con#ert data into meaningful pictures of business processes, markets and consumers that are needed to feed compan% strategies in order to de#elop competiti#e ad#antage! 2n the administrati#e side, such elements as flo& path economics, &hich help organi$ations understand the real dri#ers of costs, and ne& performance and measurement standards that align functions in accordance &ith total process goals that are critical to achie#ing integration!

SCM Framework
A frame&ork to understand the #arious issues in#ol#ed in S() is pro#ided b% the p%ramid structure for the S() paradigm *fig! C+ "he p%ramid allo&s issues to be anal%sed on four le#els/ Strat&"i' / 2n the strategic, le#el it is important to kno& ho& S() can contribute to the enterprises basic -#alue proposition. to the customersN 'mportant :uestions that are addressed at this le#el include / What are the basic and distincti#e ser#ice needs of the customersN What can S() do to meet these needsN (an the S() capabilities be used to pro#ide uni:ue ser#ices to the customersN etc! Stru'tura+ / After the strategic issues are dealt &ith, the ne;t le#el :uestion*s+ that should be asked are / Should the organi$ation market directl% or should it use distributors or other intermediaries to reach the customersN What should the S() net&ork look likeN What products should be sourced from &hich manufacturing locationsN =o& man% &arehouses should the compan% ha#e and &here should the be locatedN What is the mission of each facilit% *full stocking, fast mo#ing items onl%, cross-docking etc!+N etc! !un'ti(na+ / "his is the le#el &here operational details are decided upon! Kunctional e;cellence re:uires that the optimal operating practices for transportation management, &arehouse operations, and materials management *&hich includes forecasting, in#entor% management, production scheduling, and purchasing+ are designed! "hese strategies should

keep in #ie& the trade-offs that ma% need to be made for the o#erall efficienc% of the s%stem! Achie#ing functional e;cellence also entails de#elopment of a process-oriented perspecti#e on replenishment and order fulfillment so that all acti#ities in#ol#ed in these functions can be &ell integrated!

!i". #1 % SCM !ra.&-(r2 P,ra.id

Source : Based on work done by !illiam C. Copacino[5]

I.p+&.&ntati(n / Without successful implementation, the de#elopment of S() strategies and plans is meaningless! 2f particular importance are the organi$ational and information s%stems issues! 2rgani$ational issues centers on the o#erall structure, indi#idual roles and responsibilities, and measurement s%stems needed to build an integrated operation! 'nformation s%stems are -enablers. for suppl% chain management operations and therefore must be carefull% designed to support the S() strateg%! Suppl% chain managers must consider their information needs relati#e to decision support tools, application soft&are s, data capture, and the s%stem s o#erall structure!

't is important to note that the decisions made &ithin the S() strateg% p%ramid are interdependent! "hat is, it must be understood &hat capabilities and limitations affect the

functional and implementation decisions and consider those factors &hile de#eloping a suppl% chain management strateg% and structure! "he S() models used in practice lie in a continuum bet&een t&o e;treme models / on one end of the spectrum lies the #erticall% integrated suppl% chain model in &hich the organi$ation has direct control o#er each and e#er% component of the suppl% chain, &hile on the other end of the spectrum lies the hori$ontall% di#ersified suppl% chain model *ideall%+ in &hich the number of participant is as large as the number of distinct parts of the suppl% chain! 'n an #erticall% integrated suppl% chain s%stem, the organi$ation can control e#er% component of the chain and can make #arious changes to the s%stem to optimi$e the chain #er% easil%! But in a hori$ontall% di#ersified suppl% chain the tendenc% &ill be to optimi$e onl% the functions that the organi$ation is in#ol#ed in, thus conscious efforts must be made b% the #arious participants in the suppl% chain for the integration of their respecti#e components in the suppl% chain! 'f an organi$ation can be identified as the ma4orJdominant partner in the suppl% chain, then this organi$ation has to take an initiati#e in seeking the co-operation of the other participants in the suppl% chain! "he t%pe and structure of the suppl% chain that is established depends on man% factors, some of the ma4or factors are / G&("rap i'a+ / 'f the suppl% chain is stretched across the globe then it ma% not be possible to incorporate some of the principles of lean production like 5'" deli#er%, fle;ible manufacturing, and co-ordination among suppliers and customers! 't can lead to uncertain transportation schedules, unpredictable lead time and ma% need larger in#entor% carriage! Cu+tura+ / "he difference in the -culture. of the participants in the chain *the difference can be due to geographical factors or corporate practices+ can lead to friction and distrust! "his ma% hamper the de#elopment of close ties! G(v&rn.&nt L&"i*+ati(n / "he la&s of the countr% ma% prohibit the sharing of information about some facet of the suppl% chain and thus, ma% lead to a restricti#e participation b% one or more participant in the suppl% chain!

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!i". #3 % Sp&'tru. () a++ian'&* in t & *upp+, ' ain. Ti.& / 5ust as among indi#iduals, organi$ations re:uire time before trust can be built up! "he first phase in an% relationship is manifest as confrontation, that essentiall% means that participants in the chain tr% to &in at the cost of other participants! And, the last phase is e;emplified b% total trust and &orking together of organi$ations! "he information sharing beha#iour in the first phase is almost $ero, &hile in the integrated relationship the information sharing is mutual and free about the common concerns! 'n bet&een the t&o phases lie a continuum of phases *see fig! F+!

SCM in t e !o"ernment sector

"o understand the rele#ance of ?S() to the go#ernment sector, one must understand the difference bet&een the ob4ecti#e of a go#ernmentJpublic sector enterprise and that of a pri#ate

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sector enterprise! A go#ernmentJpublic sector enterprise ob4ecti#e is not ma;imi$ation of profit solel%, but also economic de#elopment of the nation *as a long term goal+ and the &elfare of the societ%1 &hereas a pri#ate sector enterprise is oriented to&ards the sole ob4ecti#e of ma;imi$ation of profit! But, e#en if the ob4ecti#es, of there t&o e;clusi#e categories of enterprises, are entirel% different, the% share some features/ the satisfaction of their respecti#e consumers b% pro#iding the consumer &ith the right product, in the right condition and at the right time, at the least cost! the allocation of limited resources *of the nation andJor enterprise + for this purpose!

'n the go#ernment sector *in 'ndia+ the S() paradigm can be used b% the public sector organi$ations in#ol#ed in/ *a+ 0etroleum 0roducts / the bulk of the ma4or petroleum product*s+ re:uired in the countr% are indigenousl% produced, but at the same time significant proportion of crude and finished products are being imported to meet the national demand! "his re:uires the construction of a global suppl% chain that should &ithstand the #agaries of the -petroleum politics.! 0etroleum products are needed through out the countr% on a priorit% basis! "his re:uires a &ell designed and feasible transportation and distribution net&ork, integrated &ith the production plan*s+1 distribution net&ork1 pricing polic%1 national and regional demand policies etc!! *b+ Kertili$er production industr% / for the procurement of ra& materials, manufacturing and transportation and distribution to the demand centers through out the countr%, using the predicted demand *as the need for fertili$ers b% consumers is bound to ha#e a regional and seasonal effect due to the #er% nature of the product and its use+! "he S() methodolog% can be used to decide the location of ne& &arehouse*s+, the design of the ra& material procurement polic%, the design of the optimal distribution planJchannel etc! "his industr% generall% follo&s a single sourcing polic% for ra& material procurement, *c+ (oal and other minerals / "hese are primar% sector industries, suppl%ing to other industries in -core manufacturing - *the t%pe of manufacturing that is essential for the de#elopment of the

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nation like steel, electricit% etc!+ "he consumers of the product of these industries can be an% &here in the countr%, therefore a &ell designed S() strateg% is an important acti#it%! *d+ Steel industr% / "his industr% depends on three ma4or categories of supplies for the procurement of ra& materials/ *1+ (oalJcoke, *E+ )inerals *iron ore, limestone etc+ and *B+ electricit%! "his industr% needs a &ell designed a methodolog% for S(), &herein it ma% be controlling the production of the ra& materials to an e;tent, and depending on demand, supplementing &ith e;ternall% supplied ra& material! "he suppl% chain in this case needs to be totall% integrated, as a shortfall in this case can lead to closing of the furnaces that can lead to their closure, leading to substantial economic and material loss! *e+ "he Electricit% generating industr% / "his industr% in 'ndia faces a situation of demand e;ceeding the suppl%! "his demands a rationing s%stem! 't must be decided, and planning must be done for distribution of the -load shedding. time, so that the basic need of the consumers are satisfied in the region under consideration! S(), and more specificall% optimal scheduling methodologies needs to be applied! *f+ Kood @rain 0rocurement and 3istributions / "here are public sector enterprises in#ol#ed in the procurement of food grains and their storage in different parts of the countr%, As agriculture is an -industr%. &here the t%pe of product produced depends on the geo-ph%sical characteristic of the region1 the grain that is produced in one region of the countr% ma% need to be transported to another region to meet the food re:uirements in other parts of the countr%! "herefore, a polic% for the location of &arehouses in different parts of the countr%, a plan for optimal distribution of the procured foods grains among these &arehouses and to the retail shops under the 0ublic 3istribution Scheme *03S+ and for open market transaction is re:uired! A failure in an% of the links of this procurement - transportation - storage transportation - retail can lead to large scale famine in the affected part of the countr%! "he organi$ation must also be in#ol#ed in food grain distribution under e;ceptional conditions of famine, flood or earth:uake! "he S() concept can be used to manage the routine and e;traordinar% situations before this industr%!

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*g+ 0ostal clearance and deli#er% s%stem / "he 0ost and "elegraph *0O"+ department of the go#ernment of 'ndia is the organi$ation that handles the ma4or portion of the postal #olume generated in the countr% *a small fraction of the net postal #olume is carried through the pri#ate courier ser#ices+! "hus, the transportation and distribution planning is a ma4or re:uirement of the organi$ations in#ol#ed in the s%stem! A &ell designed ?S() strateg% &ill go a long &a% in impro#ing the ser#ices for postal clearance and thus increasing efficienc%! *h+ 0ublic =ealth Ser#ices / "he public health ser#ices through the go#ernment run hospitals and dispensaries forms the backbone of the health ser#ices offered b% the go#ernment of 'ndia! "he functioning of these organi$ations needs to be strengthened! Pna#ailabilit% of essential drugs and other medical supplies leads to crisis! As the pharmaceutical industr% has ma4or pla%ers from the public sector undertakings, the hospitals can ha#e a full-fledged integrated suppl% chain in#ol#ing these 0SP s! "he S() paradigm can be applied for the procurement and distribution of the life sa#ing medical drugs and other medical items! *i+ 'mport and E;port / "he go#ernment sector is in#ol#ed in the 'mport of essential items needed for the de#elopment of the nation, be that petroleum products, steel, coal, food grains, essential drugs, defense stores etc, and e;port of products that the public sector enterprises produce as a surplus, prime e;amples of these being mineral products like iron ore, mica etc! "his in#ol#es the negotiation &ith the other partiesJgo#ernment organi$ation for a#oiding double ta;ation and charting an optimal deli#er% s%stem! *4+ Banking and financial ser#ices / With the globali$ation of the &orld econom% and the liberali$ation policies pursued b% the go#ernment of 'ndia, the banking sector &as the first to recogni$e the need for offering better facilities to the customers! Also, the% &ere the first to reali$e the benefits of the use of '" for this purpose! But, the use of '" for integration of the different branches of the banks &as not offered to the customers as to pro#ide a location independent real-time banking facilit%! 't &as primaril% used onl% to automate the routine &orking of the banks and for internal administrati#e purposes! E3' can also be used for electronic clearance of inter-bank transactions leading to faster and better transfer of funds!

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All links in the s%stem needs to be addressed ade:uatel% in the design of ?S() , to meet the end ob4ecti#e of pro#iding efficient ser#ices! "he abo#e description is based on the assumption that the go#ernment enterprises &ork in an isolation! But, generall% in the suppl% chain of these enterprises, the main pla%ers are the go#ernment agencies! "hus, the implementation of S() paradigm in the case of these enterprises can be effecti#e if one takes care of / a4 "rust /- as all the organi$ation in#ol#ed belong to the same umbrella organi$ation, the building of trust among theses enterprises can be fast and more eas%! 54 Sharing of information can be more often among these organi$ation thus leading to better understanding of the suppl% chain b% the participant in the chain! '4 "he transport sector - the &eakest link in the suppl% chain - is largel% under go#ernment control *directl% andJor indirectl%+! d4 'nfrastructure /- 8eliable communication net&ork and information technolog% infrastructure needed to deplo% the information sharing mechanism do e;ist to a large e;tent in the go#ernment sector! Kor e;ample, in the public health sector this can lead to faster deli#er% of medicines &hich can help in pre#ention of epidemics! 'n situation like flood, drought or an% other calamit% the rele#ant suppl% chain can be used to pro#ide medical help, food etc! "hus, the application of S() paradigm is needed not onl% b% pri#ate enterprises engaged in the pursuit of profit but also b% organi$ations that are in#ol#ed in pro#iding ser#ices for meeting social ob4ecti#es and for the &elfare of the societ% at large!

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Conclusion
Suppl% chain management has become not 4ust a :uestion of efficient logistic process, but is related to the gro&th and sur#i#al of organi$ation*s+! With customers becoming more demanding in their re:uirement of ser#ices from the suppliers, the construction of a efficient and integrated suppl%-chain has assumed paramount importance! 'nformation technolog% pla%s a ma4or role in the formation of the suppl% chain! Efficient dissemination of information upstream and do&nstream is a ma4or re:uirement for the implementation of the suppl% chain, '" pro#ides the this &ith internet, E3' and @roupWare s and other application soft&are s! "he decision support pro#ided b% '" products *E80s, >et&ork construction tools etc+ can help the decision makers in the de#elopment of the suppl% chain process and in implementation! "he dissemination of the demand *forecast+ information throughout the chain can lead to a#oidance of the -Bull&hip. effect L1GM! "he :uantitati#e models embedded in the 3SS s for suppl% chain management are still at a #er% elementar% stage *in comparison to the theoretical de#elopments+, for decision support in the construction of an integrated demand-suppl% chain, use must be made of these ad#anced techni:ues! 2rgani$ations can gain suppl% chain related benefits through the use of internet, namel%/ more collaborati#e, timel% product de#elopment through enhanced communication bet&een functional departments, suppliers, customers and e#en regulator% agencies1 reduction of channel in#entor% and product obsolescence o&ing to closer linkage across the suppl% chain and better insight into the demand signals to dri#e product schedules and ultimatel% achie#e build-to order capabilit%1 reduction in communication costs and customer support costs &ith more interacti#e, tailored support capabilit% inherent &ith internet technologies1 ne& channel capabilities to reach different customer segments and further e;ploit current markets1 and

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abilit% to enhance traditional products and customer relationships through customisations dri#en b% internet connecti#it% and interacti#it%!

"he S() paradigm can pro#ide the mechanism for the sur#i#al of the public sector enterprises in the changing global scenario, &here the globali$ation of the &orld econom% and the liberali$ation of the 'ndian econom% is no longer a bu$$&ord, but a fact! "he failure of these enterprises can be traced to the ad-hocism and the non-application of efficient managerial practices! "his is not to sa% that these enterprises ha#e lost their rele#ance in the present scenario! "hese enterprises ha#e to adopt -change management. i!e! to change their st%le of functioning, and to form strategic alliances &ith partner public sector enterprises

Re#erences
L1M Beech 5! *1998+! "he Suppl% - 3emand >e;us / Krom 'ntegration to S%nchronisation *in -Strategic Suppl% (hain Alignment / Best 0ractices in suppl% chain management., edited @attorna, 5!+! @o&er, =ampshire, England! Bose >!I! and 0! Aiang! >eural >et&ork Kundamentals &ith @raphs, Algorithms and Applications! )cgra&-=ill, 'nc! LEEM @oldberg 3!E! *1989+! @enetic Algorithms in Search, 2ptimi$ation and machine Aearning! Addision-Wesl%, 8eading, (alifornia (hangkong 9! and Q! Q! =amies *198B+! )ultiple 2b4ecti#e 3ecision )aking / "heor% and )ethodolog%! >orth =olland, Amsterdam! (harnes A!, W!W! (ooper, 8!5!>iehaus and A! Stedr%, -Static and 3%namic Assignment )odels &ith )ultiple 2b4ecti#es and Some 8emarks on 2rgani$ational 3esigns., "ana#ement Science, 9ol! 1F, >o! 8, pp! BBDF-BBGF, 19D9! (opacino W!(! *199G+! Suppl% (hain )anagement / "he Basics and Be%ond *"he St! Aucie 0ressJA0'(S Series on 8esource )anagement+! St! Aucie 0ress, Klorida! Kreeman 5!A! and 3!)! Skapura *199E+! >eural >et&orks - Algorithms, Applications, and 0rogramming "echni:ues! Addision-Wesl% 0ublishing (o!, 8eading, (alifornia! @oodman 3!A! -A @oal 0rogramming Approach to Aggregate 0lanning of 0roduction and Work Korce., "ana#ement Science, 9ol! E0, no! 1E, pp! 1FD9-1FGF, 19GC! =a&ang, (hiang-Aai and A!S!)d! )asud, *19G9+! )ultiple 2b4ecti#e 3ecision )aking )ethods and Applications! Springer 9erlag, Berlin! =ert$ 5!, A! Irogh and 8! @! 0almer *1991+! 'ntroduction to "he "heor% of >eural (omputing *Aecture >otes 9olume ', Santa Ke 'nstitute, Studies in the Science of (omple;it%+! Addision-Wesl% 0ublishing (o!, 8eading, (alifornia! 5asskelainen 9! -A @oal 0rogramming )odel 2f Aggregate 0roduction 0lanning., The Swedish Journal of $conomics , 9ol! G1, >o! 1, pp! 1C-E9, 19D9 Ieen% 8!A! and =! 8aiffa *19GD+! 3ecision &ith )ultiple 2b4ecti#es / 0references and 9alue "radeoffs! Wile%, >e& Qork!

LEM

LBM LCM

LFM LDM L8M L9M L10M

L11M L1EM

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