Supply Chain and Logistics Information System explained with example

1. SUPPLY CHAIN AND
LOGISTICS INFORMATION
SYSTEM
By:
Anusuya Nandi (1627538)
Ashwin Kumar R S (1627504)
Sidharth S (1627528)
Adaikappan L (1627502)

2. WHAT IS A LMIS?
A logistics management information system (LMIS) is a system of
records and reports – whether paper-based or electronic – used to
aggregate, analyze, validate and display data that can be used to
make logistics decisions and manage the supply chain.
LMIS data elements include stock on hand, losses and adjustments,
consumption, demand, issues, shipment status, and information
about the cost of commodities managed in the system.

5. LMIS IN THE SUPPLY CHAIN
Links the different levels in the system through information.
Provides information each needs to perform their supply chain role.
LIS is designed to provide professionals working within the logistics
and operations management area with the skills to manage the flow
of materials and information within and between organizations and
their business environment.

6. COMMON CHALLENGES IN LMIS
Poor recordkeeping: incomplete or not updated stock and
consumption records.
Poor reporting: late, incomplete and poor quality reports.
Data not moving up or down the system: facilities not submitting to
districts, districts not sending reports to central, central not providing
feedback to districts and facilities.
Data not used for decision making.

7. E-BUSINESS IN SCM
The term ‘e-business’ was
introduced by IBM in 1997. In its
origins it is defined as “the
transformation of key business
processes through the use of
Internet technologies”
Three major categories:
 e-Commerce
 e- Procurement
 e- Collaboration (SRM,CRM and CPFR)

8. E-COMMERCE AND ITS BENEFITS
E-commerce is a commercial
transaction of buying or selling
online.
The Benefits of same are:
It reduces the middle men and
number of layers to connect to
customers
Keeping track of all the flows
Better flexibility in meeting the
demand
No geographic limitation, wide
product variety, customer base and
market place

9. E- PROCUREMENT
e-Procurement allows companies to use the Internet for procuring
direct or indirect materials, as well as handling value-added services
like transportation, warehousing, customs clearing, payment, quality
validation, and documentation.

10. E-PROCUREMENT
.

11. E- COLLABORATION
Information sharing and integration to process and resource sharing.
The tools used are structured and targeted to optimize the flow of
information in the company.
EDI - Electronic Data Interchange
Extranet
Web 2.0

12. E-COLLABORATION
SRM - Supplier Relationship Management
Focuses on collaborative planning goals and processes between customers and
their suppliers
CRM - Customer Relationship Management
Understanding the customer and supports the communication stream between
customer and the organization
CPFR - Collabrative Planning, Forecasting and Replenishment
CPFR seeks cooperative management of inventory through joint visibility and
replenishment of products throughout the supply chain. Information shared
between suppliers and retailers aids in planning and satisfying customer
demands through a supportive system of shared information

13. INFORMATION FLOW IN SCM
Information flow as one of the three major flow components of the
supply chain .
 Information serves as the connection between the supply chain’s
various stages, allowing them to coordinate their actions.
Example:
Request for quotation, purchase order, monthly schedules,
engineering change requests.

15. EXAMPLES OF INFORMATION FLOWS

16. SUPPLY CHAIN COORDINATION
SCC aims at improving supply chain performance by aligning
the plans and the objectives of each level of SC. It usually
focuses on inventory management and ordering decisions in
distributed inter-company settings.
Supply chain coordination improves if all stages of the chain
take actions that together increase total supply chain profits.
A lack of coordination occurs either because :
1. Different stages of the supply chain have objectives that conflict or;
2. Information moving between stages is delayed and distorted.

17. EFFECTS OF LACK OF
COORDINATION
1. Increased manufacturing cost: As a result of the Bullwhip effect,
manufacturer must satisfy a stream of orders that is much more
variable than customer demand.
2. Increased Inventory cost: To handle the increased variability in
demand, manufacturer has to carry a higher level of inventory.
3. Increased Replenishment Times: Increased variability makes
scheduling at manufacturers much more difficult and the available
capacity and inventory cannot supply the orders coming in.
4. Increased Transportation cost: Transportation requirements
fluctuate significantly over time and thus surplus transportation
capacity needs to be maintained to cover high demand periods.

18. 6. Increased Labor cost for shipping and receiving: Labor
requirements fluctuate with orders and thus manufacturers have
the option of either carrying excess labor capacity or varying labor
capacity, both of which increases total labor cost.
7. Level of product availability: Hurts the level of product availability
and result in more stock-outs in the supply chain
8. Relationships across the Supply Chain: Has a negative effect on
performance at every stage and thus hurts the relationships
between different stages of the supply chain.

19. OBSTACLES TO SC
1. Incentive Obstacles
 Local optimization within functions or
stages of a supply chain
 Sales Force Incentives
2. Information Processing
Obstacles
 Forecasting based on Orders and not
Customer Demand
 Lack of Information sharing
3. Operational Obstacles
• Ordering in Large Lots
• Large Replenishment Lead times
4. Pricing Obstacles
• Lot-size based quantity discounts
• Price fluctuations due to demand
5. Behavioral Obstacles
• Each stage of the supply chain views
its actions locally and is unable to
see the impact of its actions on
other stages.
• A lack of trust among supply chain
partners causes them to be
opportunistic at the SC performance

20. 1. Aligning of goals and incentives.
2. Improving Information Accuracy
3. Improving operational performance
4. Designing pricing strategies to stabilize
orders
5. Building partnerships and trust
HOW TO OVERCOME?