E-Business and the Supply Chain
Competition, global and domestic, shortened product life cycles, and today's economic conditions provide ongoing challenges for distributors of goods and services. Organizations that remain tied to the conventional supply chain processes find the increasing demands made by major consumers to be a trial because of the inaccuracies associated with forecasting the purchasing habits of those same customers. While distributors endeavor to enter into value-added supply-chain services such as collaborative planning and vendor-managed inventories some vendors oppose the efforts which in turn forces distributors to struggle with inadequately controlled inventory levels. The outdated practices used by distributors and vendors hinder every phase of supply chain management. Without resolution, organizations face issues such as high discounts, a reduction in orders, an increase in inventory costs, and a loss of customers. It is essential for companies to create and manage a value added supply chain to remain competitive in the marketplace. In today's world the use of information technology (IT) is mandatory for any ongoing entity.
E-Business Strategies and the Creation of a Value Added Supply Chain
The Supply Chain Defined
Wikipedia (2006) states, "A supply chain, logistics network, or supply network is a coordinated system of organizations, people, activities, information, and resources involved in moving a product or service in physical or virtual manner from supplier to customer." In short, the supply chain is each individual and process that is instrumental in the amalgamation of events which brings a product or service to a consumer.
Creating the Supply Chain
"As global competition and advancing technology render borders irrelevant and link companies more closely, supply chains are growing increasingly complex. No longer simply the domain of the warehouse manager or logistics director, supply chain management is viewed by most companies as a mission-critical element" (Wharton, n.d.).
Current business trends such as low-cost country sourcing, outsourcing, customization, and globalization have increased the complexity of creating an effective supply chain for some organizations. Increased consumer demands, global competition and shareholders expectations, and complex distribution models augment the difficulties faced by companies attempting to manage these complex systems.
Wharton (n.d.) states, "The first hurdle to coordination and collaboration is within the four walls of your company." Poor communication and use of antiquated systems is a major stumbling block in the development of an efficient supply chain. Modifications necessitated by a need to comply with the evolving world of business and technology often results in culture shock for employees of organizations undergoing rapid operational and cultural changes. Without resolving the internal issues the organization will find attempts to align the...