Module 5: IT and Supply Chain Management and

Strategic Challenges

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 Information Technology and Supply Chains

• Information, along with materials and money, must readily flow across the supply chain to
enable the planning, execution, and evaluation of key functions.
• Each participant in the supply chain needs relevant information to make effective
forecasts and operational decisions.
• Information is the lifeline of business, driving effective decisions and actions. It is
especially critical to supply chain managers because their direct line of sight to supply
chain processes is very limited.
• A wide variety of information is needed for a supply chain to perform as anticipated.
• The seven R’s (Right product, in the Right quantity, in the Right condition, at the Right
place, at the Right time, to the Right customer, at the Right price).
• Information must be accessible, relevant, accurate, timely, and transferable

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Top 10 Supply Chain Management Software Leaders by Analyst Rating 2024

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Key Requirements/Features of Supply chain Management

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Key Requirements/Features of Supply chain Management
1. Post-pandemic Resilience
Economic disruptions, school closures and variable
lockdowns threw countless industries into upheaval.
Supply chains worldwide are picking up the pieces and
charting new territory. A Statista report shows a very
volatile supply chain pressure index since the pandemic’s
onset.

2.Blockchain leverages chunks or “blocks” of data, whereas

normal databases store their information in tables. These
storage blocks eventually hit their capacities, and as data
flows in, new blocks are created and chained to their
predecessor.
Research and Markets shows the global supply chain market
for blockchain growing to $3,272 million by 2026.

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Key Requirements/Features of Supply chain Management
3. Digital Supply Chain Twins
A Supply Chain Digital Twin is a detailed simulation model of an actual supply chain which uses real-time data and
snapshots to forecast supply chain dynamics.
4. Supply Chain as a Service (SCaaS)
Supply Chain as a Service (SCaaS) is best understood as the division of the supply chain into chunks that can be outsourced
to, or accessed by, third parties. It allows companies to scale their supply chains up or down while giving access to variable
price structures and resources that would otherwise be hard to find.
5. Circular Supply Chains
A circular supply chain is one that uses materials and goods as long as possible, instead of letting them go immediately to
waste. In a circular supply chain, manufacturers reuse raw materials such as plastic, metal, cardboard, paper, steel, and
glass. They refurbish and resell previously owned goods. A Research and Markets report expects the reverse logistics
market to exhibit a CAGR (Compound annual growth rate) of 5.80% during the forecast period of 2022 to 2027.
6. Cloud-based Products
Cloud systems offer similar levels of functionality and security as their on-premise counterparts while reducing sunk
costs and customization woes that plague traditional software.
The recent Markets and Markets report shows the cloud-based supply chain management market will grow to nearly
$45.2 billion in value by 2027.
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 Key Requirements/Features of Supply chain Management
7. AI and IoT
IoT devices provide the data for AI systems to analyze, learn from, and automate. While IoT focuses on connectivity
and automation, AI focuses on analysis, interpretation, and decision-making

10. Capacity Crunch

8. Robots and Automation
A capacity crunch is when the supply of
freight truck space and lane fulfillment
cannot meet the demand for that space or
those lanes. This is detrimental to both
carriers and shippers.
9. 5G Networks
The difference between 4G and 5G network density is staggering. 4G networks can handle 10,000 devices per square mile,
while 5G supports 100 times that amount. With digital transformations becoming mainstream, a heavy-duty network needs
to be in place to ensure that communication between processes, machinery and users is quick and seamless.
5G boosts quality and optimizes vital portions of the supply chain from logistics to distribution and warehouse
management.

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How Does the SCM System Work?
How Does the SCM System Work?
A supply chain is a coordinated network. Therefore, any SCM
system must also have a cohesive structure that enables
functionality and visibility along the product delivery journey.
As such, an SCM system would typically integrate features such
as inventory management, warehouse management,
purchase-order processing, demand forecasting, supplier
relationship management, logistics planning, and so on.
Also, most SCM systems are integrated with bookkeeping
functionalities to enable the business to manage its ledger and
optimize finances effectively.

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Step 1. Onboarding
Crucial steps of implementing supply chain management system:
Step 1:Onboarding:

Managers, operators, and vendors should be familiarized with the new system. It would help if there was a business case study,
explaining why the old system was out-of-date and how the new system can enhance operations.
Key staff must be aware of the functionalities and capabilities of the new system and so it is important to communicate
frequently throughout the process. This onboarding stage may take up to a couple of weeks
Step 2. Technology Considerations
This is one of the most important decisions in any SCM implementation plan. we need to determine if it’s an on-premise or a
SaaS product.
Examples of questions to ask at this stage:
How many servers do you need?
Do you have supporting infrastructure?
What development stack would it be built on?
Will you build a new solution in-house or outsource the development?

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Step 1. Onboarding
Crucial steps of implementing supply chain management system:
Step 3. Start testing early and test often
An SCM is an overarching solution that transcends and connects all business departments. It should be ensured that it is
perfectly fit for the business before the final implementation. The way to do this is to start testing early in the supply chain
management implementation steps.
How Can the ProCoders Team Help to Implement the SCM System?
Of the many options available, building own SCM system building own SCM system from scratch is a great way to transform
the supply chain operations. Many on-demand software solutions today may not be comprehensive enough to cater to niche
needs, especially if the business operates in a non-typical context. A software development company can listen to the needs
and assemble according to the requirement.
Advantages of SCM Systems
1. Cost Savings 7. Quality Control 8. Productivity and Efficiency
2. Smart Decision-making
3. Collaboration
4. Demand Management
5. Logistics Management The market of logistics software is growing, with revenue of $17.58 billion in 2022 and estimates of
up to $23.21 billion by 2027.
6. Business Stability
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 Principles of Supply Chain Management

1. Dividing Customers into Groups

The first of the Principles of Supply Chain Management is dividing customers into distinct groups based on their needs and
use your supply chain to meet their needs. This classification lets you serve each group more efficiently in terms of average
cost and profitability within and across customer segments.
2. Maintaining Differentiation of Products and Delivery on Time
Most producers use the traditional way to set production targets based on potential estimates of demand on the final products
and determining the time required to convert raw materials into final products. There are many methods such as cellular
manufacturing or the Just-in-time (JIT) production method.
3. Setting up a Network for Supply Chain Systems
Organizations take the traditional harmony approach to design the network of supply systems to organize inventory and
transportation activities. It can also follow another approach to achieve effective and efficient use of assets.
Raw materials are used to meet the needs of individuals with appropriate quality standards to ensure the achievement of
competitive advantage and reduce production costs.

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4. Proper Planning of Market Demand
Demand forecasting is a historical procedure that relies on the availability of accurate and timely information, providing a
complete picture of the expected rate of demand in the market.
Functional orientation can cause some problems to the demand forecasting process because self-centered forecasting,
based on the organization's administrative departments of is incompatible with the distinct management of the supply
chain.
The distinction in the supply chain is achieved through the application of the Cross-Functional Planning Process or using
demand planning software (DPS).
5. Creating Cooperation and Commitment with the Supplier Chain
The organization must establish long-term cooperation and commitment with suppliers through which the supplier
delivers raw materials according to the right quantities, prices, and on time without any delay or shortage.
The absence of this realistic relationship makes managing your organization's supply chain ineffective, resulting in
obstacles like price war or one of the competitors getting a lower price for raw materials.
Effective supply chain management requires focusing on the supplier's cost structure and reducing these costs to ensure
that you get the lowest price in the market, increasing the profit margin for your organization.

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6. Using Technology in the Supply Chain
Many organizations work to develop the supply chain through the application of the technology expansion strategy,
which helps in the decision-making process and gives a visualization of the flow of services and final products in the
market, using modern technological technologies and software in all stages of production processes, or even in the
process of planning demand and obtaining information.

It adopts the approach of process re-engineering by abandoning the functional orientation and focusing on the
operational orientation by involving Material Requirement Planning (MRP), developing a computerized system to
build inventory, schedule production, manage inputs, and include marketing activities and purchasing operations.

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 What is supply chain analytics?
Analytics represent the ability to make data-driven decisions, based on a summary of relevant, trusted data, often using
visualization in the form of graphs, charts and other means.
Supply chains typically generate massive amounts of data. Supply chain analytics helps to make sense of all this data —
uncovering patterns and generating insights.

Types of supply chain analytics

1. Descriptive analytics: Provides visibility and a single source of truth across the supply chain, for both internal
and external systems and data.
2. Predictive analytics: Helps an organization understand the most likely outcome or future scenario and its
business implications. For example, by using predictive analytics, you can project and mitigate disruptions and
risks.
3. Prescriptive analytics: Helps organizations to solve problems and collaborate for maximum business value.
Helps businesses to collaborate with logistic partners to reduce time and effort in mitigating disruptions.
4. Cognitive analytics: Helps an organization answer complex questions in natural language — in the way a
person or team of people might respond to a question. It assists companies to think through a complex
problem or issue, such as “How might we improve or optimize X?”

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 Digitalization involves the integration of digital technologies into
all aspects of the supply chain, from sourcing raw materials to
delivering finished products. On the other hand, automation
consists in using machines and software to perform tasks
previously done by humans.

https://www.cxotalk.com/episode/supply-chain-innovation-transformation-sustainability

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Imperatives for Supply Chain Talent Management
Organizations must provide clear paths for progression, professional development programs, and
challenging projects to attract talent who are motivated by continuous learning and upward mobility

Benefits of Attracting and Retaining the Right Experienced Supply Chain Talent:
1. Expertise and Knowledge: Experienced professionals bring a wealth of knowledge, industry insights, and expertise
in supply chain management. They possess a deep understanding of the complexities and intricacies of supply chain
processes, enabling them to navigate challenges and make informed decisions.
2. Operational Efficiency: Seasoned supply chain professionals have the ability to optimize operations, streamline
processes, and identify areas for improvement. Their experience allows them to identify inefficiencies, implement
best practices, and drive operational excellence, leading to cost reductions and improved overall efficiency.
3. Risk Management: Supply chain operations are subject to various risks, such as disruptions in logistics, supplier
dependencies, and unforeseen market changes. Experienced professionals understand risk management strategies
and can develop proactive measures to mitigate risks, ensuring business continuity and minimizing the impact of
disruptions.

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4. Strategic Decision-Making: Experienced talent possesses a strategic mindset and the ability to make informed
decisions that align with organizational goals. They can analyze data, interpret market trends, and consider long-term
implications, enabling them to develop and execute effective supply chain strategies that drive business growth.
5. Supplier Relationship Management: Skilled professionals with experience in supply chain management have
established relationships with suppliers and understand the dynamics of supplier management. They can effectively
negotiate contracts, assess supplier capabilities, and build collaborative partnerships that contribute to supply chain
efficiency and resilience.
6. Adaptability and Flexibility: Experienced professionals have the ability to adapt to changing market conditions,
technological advancements, and evolving customer demands. They bring a level of flexibility and agility to the supply
chain function, allowing organizations to respond quickly to disruptions, seize opportunities, and stay ahead of the
competition.
7. Mentoring and Leadership: Seasoned talent can act as mentors and leaders within the organization, guiding and
developing junior supply chain professionals. Their experience and knowledge serve as a valuable resource for
building a strong talent pipeline and fostering a culture of continuous learning and improvement.
8. Stakeholder Management: Effective supply chain management requires collaboration and coordination with
various stakeholders, both internal and external. Experienced professionals excel in stakeholder management,
maintaining strong relationships with cross-functional teams, executives, customers, and suppliers, which facilitates
smoother operations and better alignment of supply chain activities with business objectives. bschool.cms.ac.in
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 Sustainability- Supply Chain Innovation and Transformation
https://www.manufacturingtodayindia.com/people/sustainability-innovation-and-supply-chain-transformation

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 Innovations in Supply chain management
What is Supply Chain Transformation?
Supply chain transformation is the leveraging of digital technologies such as Internet of Things (IoT), cloud,
big data, AI and ML to create an agile, high-performance supply chain that responds to constantly changing
business dynamics and customer expectations, and also helps enterprises to retain their competitive
advantage.

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