Wednesday, 17 August 2016

Supply Chain Management & Information Technology

Information is a key supply chain driver because it serves as the glue that allows the other supply chain drivers to work together with the goal of creating an integrated, coordinated supply chain. Information is crucial to supply chain performance because it provides the foundation on which supply chain processes execute transaction and managers make decision and they must understand how information is gathered and analyzed. This is why IT comes into play. IT consists of the hardware, software, and people throughout a supply chain that gather, analyze, and execute upon information.

Now a day’s, Electronic commerce and the Internet are fundamentally changing the nature of supply chains, and redefining how consumers learn about, select, purchase, and use products and services. The result has been the emergence of new business-to business supply chains that are consumer-focused rather than product-focused. They also provide customized products and services. E-commerce impacts on supply chain management in a variety of keyways. These include cost efficiency, improve data accuracy, streamline business processes, accelerate business cycles, and enhance customer service. Besides that, E-commerce gives businesses more flexibility in managing the increasingly complex movement of products and information between businesses, their suppliers and customers. It is a vital link in the support of logistics and transportation services for both internal and external customers to give better services to their customers. E- Commerce also helps to company and its suppliers and customers in Shipment tracking, shipping notice, Freight auditing, Shipping Documentation and Labelling, online Shipping Inquiry etc.


Monday, 1 August 2016

What is Joint Replenishment Inventory Systems ?

Joint replenishment inventory systems are used whenever a number of items are involved in replenishment and it is possible to share the fixed cost associated with replenishment. This fixed cost takes the form of a manufacturing setup cost in the case of manufacturing multi-items using the same facility. In the case of pure inventory systems, the fixed cost of replenishment is that part of ordering cost which is independent of the number of items on order.

When a product is packaged into more than one type of container immediately after manufacture, there is a saving in cost if these items are manufactured jointly and then packaged individually. The economic advantage of manufacturing jointly and packaging individually is due to the fact that if items are manufactured and packaged individually, then each item is accountable for the full setup cost for each of its manufacturing and packaging setups. As a result of manufacturing the items jointly, it is possible to reduce the cost of setups required for manufacturing.


The joint replenishment problem is also similar to the inventory control problem faced by a company procuring several items from a single supplier. In this case, ordering items jointly reduces the ordering cost and may enable utilization of the same transportation facility and/or group quantity discounts. In real-life procurement processes, joint replenishment of items is the common practice used as opposed to independent replenishment of single items. On the manufacturing side, joint replenishment of multi items on single machinery is becoming more widespread through the utilization of flexible machine tools which provide product, operation and routing flexibilities.