Role of Information

Technology in Supply
Chain Management
N A M E : AGN IV C H AT T E R J E E
U N I V E R S I T Y R O L L N O : 11 0 0 1 4 1 9 0 1 3
S T R E A M : T E X T IL E T E C H N O LO GY
S E M E S T E R : 8 T H S E M E S TE R
PA P E R C O D E : P E T T 8 0 1 B
PA P E R N A M E : S U P P LY C H AIN M AN AG E M
ENT
 Supply Chain
Management
A supply chain refers to the entire process of making and selling goods,
from the supply of raw materials and using them to manufacture products
to the distribution and sale to consumers. It is a network of companies,
including suppliers, manufacturers, shippers, distributors and retailers,
working together to make stuff like logistics, inventory management,
transportation and so forth go as smoothly as possible.
Supply Chain Management is the process of effectively managing the
components of an extended value chain from suppliers, through
manufacturing and distribution chain and to the consumers.
 Objective of Supply Chain Management
 Primary Objective:-
 Creating value for a Customer.
 Responds to Customers needs and demands

 Secondary Objective:-
 Profitability
 Responsiveness
 Turnover Rate
 Flexibility
 Communication and Coordination

The supply chain starts with the supplies. With
a reliable supply chain software that allows
real- time information sharing, manufacturers
and suppliers can collaborate better and avoid
production delays due to insufficient raw
materials.
Suppliers
Retailers can integrate their POS systems, which
capture their sales, with their tool for
monitoring the stock level, which is also visible
to the distributor. Retailers can also set a reorder
point that when reached will automatically
generate an order.
Retailers
IT offers better visibility and transparency that
lead to better accountability and control over the
production of goods. Manufacturers that have
clear visibility on production can make
adjustments to make the process more efficient as
Manufacturers
well as foresee
problems and prevent them.
Shippers
Benefits of As a shipper or logistics provider, it can
ensure customer satisfaction by improving
IT in order tracking and delivery. Keeping the
manufacturers and distributors informed
SCM of the entire delivery process and possible
delays already puts a step closer to repeat
business.
With the right tool and documented process,
Distributors distributors no longer have to worry about excess
or insufficient stock. Instead, they can predict
demands and effectively manage inventory and
orders.
 Role of IT in supply chain
management
The role of IT in Supply Chain Management is highlighted in the
following points.
1. Integrated and Coordinated Supply Chain
A supply chain can only work efficiently when it is properly integrated
and well-coordinated. IT performs this crucial task by bringing in multiple
technologies and combining them to optimise the supply chain. These
technologies make data collection possible and much easier and more
accurate. In turn, this allows precise and detailed data analysis leading to
sound business decisions.

2. Increased Productivity
Smooth flow of information, new technologies and effective
communication increase the productivity of all entities in the supply
chain. It is like a trigger for product movement. Instead of going back and
forth, IT provides the link that passes the needed information
continuously.
3. Cost Reduction
IT permits optimum utilisation of resources and assets. Old data is used to
study the trends, and technology is used to analyse it for improving
performance. When resources are used optimally, they result in cost
reduction.

4. Product Improvement
IT consists of tools and applications which can be used to gain early
awareness. In a market where consumers always want something new, the
product will either have to evolve or it will go out of demand. To stay in
business, you must introduce product improvement and innovation sooner
rather than later. The kind and extent of product improvement can be
validated with the help of IT.

5. Supply Chain Visibility

Information makes the entire supply chain visible to supply chain
managers. The manner in which the information flows from one
collaborator to the other and the impact it has on others is used by the
managers in making strategic decisions.
 Functional role of IT in Supply Chain
Management
Transaction Execution
When information flows efficiently between
the participants of the supply chain, the
number of transactions between them is
reduced. IT increases the efficiency of
repetitive data exchanges. This data is
usually appropriate for delivery verification,
order processing, billing, and dispatch
advice.
Collaboration and
Coordination
IT renders the flow of information. This
makes for easier planning, coordination
and improved collaboration between all
participants. Demand forecasts make it
possible to plan for the future, and order
tracking makes knowing the physical
location of each order a reality.
Decision Support
Good decisions cannot be pulled out of
thin air. They are and should be based
on data. IT is a huge benefit in decision
support. It can collect even the most
complicated set of data and convert it
to easy-to-understand charts and
reports. In this context, IT extends
decision support to all managers.
 Software for Supply Chain
Management
There are many tools that are used for effective supply chain
management. These are primarily categorised as:
1. Enterprise Resource Planning
Materials requirement planning, which was earlier used to
distribute resources for a manufacturing operation, resulted in
enterprise resource planning (ERP), a system that links individual
IT applications into a single one. This results in the integration of
the data and the processes of the complete business.When all
operations are consolidated, information related to cash flow and
material flow starts making more sense. ERP has now become the
backbone of the supply chain and provides an integrated view of
the organisation as a whole. Today, ERP has also led to the
automation of many functions so that there is minimal human
intervention.
2. Electronic Data Interchange
Electronic Data Interchange (EDI) is the exchange of business data from
one computer to another. It is usually done in a standard format so that all
concerned parties can use it according to their need without having to
constantly ask for it. EDI allows companies, across the industry, to
communicate with one another. Everyone who uses EDI follows the same
rules and methods. This makes for efficient inventory management,
better business relationships, and improved customer service.

3. Supply Chain Management Systems

An ideal supply chain management system will help in planning, selecting
the vendor, manufacturing, logistics, and building the customer
relationship. To provide the necessary assistance Supply Chain Planning
(SCP) software and Supply Chain Execution (SCE) software are used.
4. Customer Relationship Management

CRM or e-CRM uses IT to assist an e-business in managing its

customer base. It matches customer needs with the product plans to
increase sales.
 Conclusion
The secret behind successful Supply Chain Management lies in
IT. From the very beginning of the supply chain to its very
end, data plays a key role in bringing the entire set together. IT
tools provide the necessary communication link between all
entities and allow them to work independently and yet in a
coordinated manner. The role of IT in supply chain
management is undeniable. It is the chain that binds everyone
and everything together. It is vital!
Thank You