What is the goal of installing supply chain management software?
Before the Internet came along, the aspirations of supply chain software devotees were limited to improving their ability to predict demand from customers and make their own supply chains run more smoothly. But the cheap, ubiquitous nature of the Internet, along with its simple, universally accepted communication standards have thrown things wide open. Now, theoretically anyway, you can connect your supply chain with the supply chains of your suppliers and customers together in a single vast network that optimizes costs and opportunities for everyone involved. This was the reason for the B2B explosion; the idea that everyone you do business with could be connected together into one big happy, cooperative family.
Of course, the reality behind this vision is that it will take years to come to fruition. But considering that B2B has only been around for a few years, some industries have already made great progress, most notably consumer-packaged goods (the companies that make products that go to supermarkets and drug stores), high technology and autos.
When you ask the people on the front lines in these industries what they hope to gain from their supply chain efforts in the near term, they will all respond with a single word: visibility. The supply chain in most industries is like a big card game. The players don't want to show their cards because they don't trust anyone else with the information. But if they showed their hands they could all benefit. Suppliers wouldn't have to guess how much raw materials to order, and manufacturers wouldn't have to order more than they need from suppliers to make sure they have enough on hand if demand for their products unexpectedly goes up. And retailers would have fewer empty shelves if they shared the information they had about sales of a manufacturer's product in all their stores with the manufacturer. The Internet makes showing your hand to others possible, but centuries of distrust and lack of coordination within industries make it difficult.
What is supply chain collaboration?
Let's look at consumer packaged goods as an example of collaboration. If there are two companies that have made supply chain a household word, they are Wal-Mart and Procter & Gamble. Before these two companies started collaborating back in the '80s, retailers shared very little information with manufacturers. But then the two giants built a software system that hooked P&G up to Wal-Mart's distribution centers. When P&G's products run low at the distribution centers, the system sends an automatic alert to P&G to ship more products. In some cases, the system goes all the way to the individual Wal-Mart store. It lets P&G monitor the shelves through real-time satellite link-ups that send messages to the 无耻悲鄙下流的网"学.网总是抄辣,文^论,文.网http://www.751com.cn , P&G knows when to make, ship and display more products at the Wal-Mart stores. No need to keep products piled up in warehouses awaiting Wal-Mart's call. Invoicing and payments happen automatically too. The system saves P&G so much in time, reduced inventory and lower order-processing costs that it can afford to give Wal-Mart "low, everyday prices" without putting itself out of business.
Cisco Systems, which makes equipment to hook up to the Internet, is also famous for its supply chain collaboration. Cisco has a network of component suppliers, distributors and contract manufacturers that are linked through Cisco's extranet to form a virtual, just-in-time supply chain. When a customer orders a typical Cisco product-for example, a router that directs Internet traffic over a company network-through Cisco's website, the order triggers a flurry of messages to contract manufacturers of printed circuit board assemblies. Distributors, meanwhile, are alerted to supply the generic components of the router, such as a power supply. Cisco's contract manufacturers, some of whom make subassemblies like the router chassis and others who assemble the finished product, already know what's coming down the order pipe because they've logged on to Cisco's extranet and linked in to Cisco's own manufacturing execution systems.
Soon after the contract manufacturers reach into Cisco's extranet, the extranet starts poking around the contractor's assembly line to make sure everything is kosher. Factory assemblers slap a bar code on the router, scan it and plug in cables that simulate those of a typical corporate network. One of those cables is a fire hose for Cisco's automated testing software. It looks up the bar code, matches it to a customer's order and then probes the nascent router to see if it has all the ports and memory that the customer wanted. If everything checks out-and only then-Cisco's software releases the customer name and shipping information so that the subcontractor can get it off the shop floor.
And there you have it. No warehouses, no inventory, no paper invoices, just a very nosy software program that monitors Cisco's supply chain automatically, in real-time, everywhere, simultaneously. The chain runs itself until there's a problem, in which case the system alerts