The prolific growth of the internet and its use has greatly transformed how businesses operate and compete today. The use of e-supply chain is one of the competing tools used by organizations today due to availability of internet. E-supply chain management refers to the flow of commodities and associated information from producers to customers. It has materialized from the use of internet technologies in supply management by organizations. E-supply chain is enabled when all the participants within the supply chain are integrated to share information in real-time. This is mostly possible through direct integration between systems or other electronic marketplaces that centralize all the data on supplies.
E-supply chain management is used by organizations as a competitive advantage over their competitors. This is because it enables good inventory management of the organization’s products. E-supply chain management reports products status and stock quantity within the chain which allows for easier updates on inventories. This ensures quick delivery or services to consumers which is a competitive advantage. It also provides information on picking, packing and shipping of products which allow easier and quick tracking of products bought by customers. It also facilitates easier commodity back ordering if it’s not to the customers’ expectations. It also helps to reduce costs of transportation as inventory information is known and thus the shortest way to delivery a product is applied.
E-supply chain management allows an organization to offer better services to customers to ensure competition. Customers easily purchase products online as this management offers customers the correct product assortment and quantity to be delivered. This supply management also ensures the right stock location so as to offer quick deliver to customers. It also helps the organization to offer quick after sales services, like repair of electronics on time. Another added competitive advantage is increased profits. Supply managers help to control and reduce chain costs as well as increase cash flow as they speed up product flow to customers. These managers also ensure reduced fixed assets like warehouses or transportation vehicles. All these help an organization to increases its profits thus become more competitive.
The e-supply chain comprises several components which ensure its effectiveness. The first component is supply chain replenishment. Supply chain replenishment is where you ensure the right stock, in the right place, whenever a customer wants to purchase it. Here we quickly replace recent actual demand and not accumulating stock on the basis of forecasting future demand. This ensures the right quantity inventory in the right place to serve the actual demand. This helps an organization to reduce cost of transportation in delivering products to customers. It also helps a firm to reduce the storage costs as most of its inventory is distributed within different market locations. This component also enables an organization to be able to create a niche market which offers a competitive advantage.
The second component in the e-supply chain is adoption of collaborative planning and scheduling with critical suppliers and customers. This is also known as Collaborative Planning Forecasting and Replenishment (CPFR). It is normally supported by the Global Supply Chain (GSC) software. This is where suppliers and customers are able to share forecasts and order status. This enables customers to order products through the software directly from suppliers. This enables organizations to reduce cost of advertising products as well as opening retail shops as customers purchase products directly online.
The lastly in e-supply chain we have e-procurement and e-logistics. E-logistics is where the internet is used as a means of sharing information between all parties within the supply chain including customers. E-procurement on the other hand ensures that customers facing e-commerce systems get access to accurate and timely data on inventory, orders and supplies. It prevents unauthorized purchases, speeds up transactions and collection of payments. Both e-logistics and e-procurement provides for assessments on quality of products as reported back by customers. They both help to reduce the cost of transactions with customers as even payments are made easier.
Vail Resorts in Colorado is an example of an organization that applies e-supply chain. Vail has around 170 restaurants, shops and hotels altogether. Before the introduction of e-supply chain, Vail placed food orders via fax. It was estimated that three buyers could spend up to 45 hours a month in order placement. Vail introduced an internal order-entry system through consulting Network Exchange. This system enabled Vail to transmit bids to its suppliers and receive confirmations in minutes as compared to previous five hours.
Another company that applies e-supply is Adaptec Inc based in Silicon-Valley. It produces computer chips and boards. It obtains many of its parts from East Asia and thus an e-supply chain would help. The company uses the internet component of e-business, which makes it easier for suppliers to purchase orders and get factory-status updates. This has enabled the company to cut down the manufacturing cycle from 12 weeks to 8 weeks. I would choose the Vail’s e-supply chain as it integrates many stores within a short time which shows efficiency and accuracy of the system.