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Chapter16
InformationTechnology
andtheSupplyChainSupplyChainManagement
(3rdEdition)
17-1OutlineTheRoleofInformationTechnologyintheSupplyChainTheSupplyChainITFrameworkCustomerRelationshipManagementInternalSupplyChainManagementSupplierRelationshipManagementTheTransactionManagementFoundationTheFutureofITintheSupplyChainSupplyChainInformationTechnologyinPractice2RoleofInformationTechnology
inaSupplyChainInformationisthedriverthatservesasthe“glue”tocreateacoordinatedsupplychainInformationmusthavethefollowingcharacteristicstobeuseful:AccurateAccessibleinatimelymannerInformationmustbeoftherightkindInformationprovidesthebasisforsupplychainmanagementdecisionsInventoryTransportationFacility3CharacteristicsofUseful
SupplyChainInformationAccurateAccessibleinatimelymannerTherightkindProvidessupplychainvisibility4UseofInformation
inaSupplyChainInformationusedatallphasesofdecisionmaking:strategic,planning,operationalExamples:Strategic:locationdecisionsOperational:whatproductswillbeproducedduringtoday’sproductionrun5UseofInformation
inaSupplyChainInventory:demandpatterns,carryingcosts,stockoutcosts,orderingcostsTransportation:costs,customerlocations,shipmentsizesFacility:location,capacity,schedulesofafacility;needinformationabouttrade-offsbetweenflexibilityandefficiency,demand,exchangerates,taxes,etc.6RoleofInformationTechnology
inaSupplyChainInformationtechnology(IT)HardwareandsoftwareusedthroughoutthesupplychaintogatherandanalyzeinformationCapturesanddeliversinformationneededtomakegooddecisionsEffectiveuseofITinthesupplychaincanhaveasignificantimpactonsupplychainperformance7TheImportanceofInformation
inaSupplyChainRelevantinformationavailablethroughoutthesupplychainallowsmanagerstomakedecisionsthattakeintoaccountallstagesofthesupplychainAllowsperformancetobeoptimizedfortheentiresupplychain,notjustforonestage–leadstohigherperformanceforeachindividualfirminthesupplychain8TheSupplyChainITFrameworkTheSupplyChainMacroProcessesCustomerRelationshipManagement(CRM)InternalSupplyChainManagement(ISCM)SupplierRelationshipManagement(SRM)Plus:TransactionManagementFoundationFigure16.1WhyFocusontheMacroProcesses?MacroProcessesAppliedtotheEvolutionofSoftware9MacroProcessesinaSupplyChain
(Figure16.1)SupplierRelationshipManagement(SRM)InternalSupplyChainManagement(ISCM)CustomerRelationshipManagement(CRM)TransactionManagementFoundation(TFM)10CustomerRelationshipManagementTheprocessesthattakeplacebetweenanenterpriseanditscustomersdownstreaminthesupplychainKeyprocesses:MarketingSellingOrdermanagementCall/Servicecenter11InternalSupplyChainManagementIncludesallprocessesinvolvedinplanningforandfulfillingacustomerorderISCMprocesses:StrategicPlanningDemandPlanningSupplyPlanningFulfillmentFieldServiceTheremustbestrongintegrationbetweentheISCMandCRMmacroprocesses12SupplierRelationshipManagementThoseprocessesfocusedontheinteractionbetweentheenterpriseandsuppliersthatareupstreaminthesupplychainKeyprocesses:DesignCollaborationSourceNegotiateBuySupplyCollaborationThereisanaturalfitbetweenISCMandSRMprocesses13TheTransactionManagementFoundationEnterprisesoftwaresystems(ERP)EarliersystemsfocusedonautomationofsimpletransactionsandthecreationofanintegratedmethodofstoringandviewingdataacrosstheenterpriseRealvalueoftheTMFexistsonlyifdecisionmakingisimprovedTheextenttowhichtheTMFenablesintegrationacrossthethreemacroprocessesdeterminesitsvalue14TheFutureofITintheSupplyChainAtthehighestlevel,thethreeSCMmacroprocesseswillcontinuetodrivetheevolutionofenterprisesoftwareSoftwarefocusedonthemacroprocesseswillbecomealargershareofthetotalenterprisesoftwaremarketandthefirmsproducingthissoftwarewillbecomemoresuccessfulFunctionality,theabilitytointegrateacrossmacroprocesses,andthestrengthoftheirecosystems,willbekeystosuccess15SupplyChainInformationTechnologyinPracticeSelectanITsystemthataddressesthecompany’skeysuccessfactorsTakeincrementalstepsandmeasurevalueAlignthelevelofsophisticationwiththeneedforsophisticationUseITsystemstosupportdecisionmaking,nottomakedecisionsThinkaboutthefu
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