3. Introduction
The term “Supply Chain Management” was coined in
1982 by Keith Oliver of Booz, Allen and Hamilton Inc.
But the discipline and practice has been in existence
for centuries.
The terms Logistics and Supply Chain Management
are used interchangeably these days, but there is a
subtle difference that exists between the two.
4. CONT.,
‘Logistics’ has a military origin, and used to be
associated with the movement of troops and their
supplies in the battlefield. But like so many other
technologies and terminologies, it entered into the
business lexicon gradually and has now become
synonymous with the set of activities ranging from
procurement of raw materials, to the delivery of the
final polished good to the end consumer.
5. CONT.,
In a typical business scenario, many organizations
work in tandem (knowingly or unknowingly) to get the
final product in hand of the end consumer. The supply
chain is a network of these organizations that coalesce
with each other (downstream or upstream) to make
the final shipment successful.
A group of farmers, a cotton mill, a designer and a
tailor is the least number of stakeholders you can
expect from a regular shirt you wear every day.
6. Introduction to Logistics and
Supply Chain Management (SCM)
Logistics is concerned with both materials flow and
information flow. While the materials flow from the
supplier to consumer, the information flows the other
way round. It is not only concerned with inventory and
resource utilization, customer response also falls under
the ambit of logistics.
7. CONT.,
In simple terms, logistics can be seen as a link between the
manufacturing and marketing operations of a company.
The traditional organizations used to think of them
separately, but there is a definite value addition in
integrating the two due to the interdependence and
feedback channel between the two.
The level of coordination
n required to minimize the overall cost for the end
consumer gets tougher to achieve as the number of
participants in a supply chain increase, as an extremely
efficient flow of material and information is required for
optimization.
8. ‘Supply Chain Management’ can be defined as the
active management of supply chain activities to
maximize customer value and achieve a sustainable
competitive advantage. It represents a conscious effort
by the supply chain firms to develop and run supply
chains in the most effective and efficient ways possible
The effectiveness and value of the supply chain is
determined by its ability to align with its partners,
whether they are service providers, employees,
suppliers or distributors. The processes and systems
have to be set to common business goals.
9. The word, ‘Logistics’ is derived from French word ‘Loger’,
which means art of war pertaining to movement and supply of
armies.
1. A military concept
2. Fighting a war requires: (i) Setting an objective (ii)
Meticulous planning to achieve the objective (iii) Proper
deployment of troops (iv) Supply lines consisting of
weaponry, food, etc.
3. A logistics plan should be such that there is minimum
loss of men and material. Similar to fighting a war in
battlefield, marketing managers also prepare a suitable
logistics plan that is capable of fulfilling the company
objective of meeting the demand of targeted customers in a
profitable way
10. Logistics is one of the most important segment of the
phenomenon of Marketing in business. It is a subset of
Supply Chain Management. In the business functioning, the
trader gets order for supply of his goods or services through his
marketing executives or directly from customers and then to
execute the order to the satisfaction of the customer, the trader
or his supplier company prepares the Logistics i.e.,
procures the product or services,
puts labels on them, or gives some identification trademark
name to them,
makes necessary packing and packaging so as to save them
from damage of any kind during loading, unloading, handling,
transportation etc., till is supplied to the end customer
11. Logistics cover the following broad
functional areas:
Network Design
Transportation
Inventory
Management.
12. Basic concepts of Logistics and
SCM
Inventory Planning
Transportation
Packaging
Warehousing
13. Organizations want to minimize the inventory levels
due to its almost linear relationship with the cost. Yet
if the demand is forecasted accurately, there would
ideally be no need for inventory and the goods will
move seamlessly from warehouses to customers.
That would have been awesome, but it is deep into the
ideal world zone. In the real world, the forecasted
numbers can only take you so far and some inventory
has to be maintained to satiate any surges in demand;
the cost of unhappy consumers who are not serviced is
often huge, and is immeasurable in most cases.
Inventory Planning
14. CONT.,
Yet overstocks lead to increase in working capital
requirements, insurance costs and blocked resources which
could have been productive someplace else.
Making a business forecast has largely been a gut-based
process, but is changing rapidly in the era of data-based
decision making. The forecast depends on the historical
baseline for sales, seasonality (soft drinks have higher sales
volume in May), recent trends (Samsung is losing out to
competitors when it comes to phones, a declining trend),
business cycles (economies go through expansion and
contraction every few years), promotional offers etc.
15. Transportation
The kind of transportation employed by an organization is
a strategic decision (it usually accounts for around 1/3rd of
the total logistics cost) based on the required level of risk
exposure, customer service profiles, geographic area
covered etc. Truck shipments take more time for delivery
compared to air transport (customers with relaxed
turnaround times); is cheaper but necessitates
maintenance of higher inventory levels.
Transportation serves the purpose of not just product
movement, but storage as well (not very intuitive). Time
spent for delivery means saved time for warehousing, and
many times the cost to offload and reload shipments can
be greater than the cost of letting the goods stay in the
transportation vehicles itself.
16. Cont.,
Two basic thumb rules apply for transportation
decisions: truck load (TL) shipments are better than
less-than-truckload (LTL) shipments as storage space
is a perishable commodity (just like a commercial
airline does not want to fly with empty seats), and the
cost per kilometer decreases as the distance increases
(two 500 km shipments is usually more expensive than
a single 1000 km shipment).
17. Cont.,
The factors which determine the economies of
transportation decisions include but are not limited to:
distance between the starting and destination points, and
density (higher density products take less space — space
constraints outweigh weight constraints by a huge margin),
stow ability (spherical packaging will lead to more empty
spaces compared to cubical) and volume of the goods.
Different modes of transport serve different strategic ends
(rail, road, air, water etc).
FlipKart has eKart for its logistical operations and
warehousing, whereas smaller e-commerce players
generally outsource their operations to specialized logistics
players such BlueDart, DHL and now Delhivery.
18. Packaging
The end goals differ: can either be done for end
consumers or for logistical considerations. The
packaging will then depend on the end goal; form
factor plays the lead role when packaging goods for the
end consumers, while function plays the lead role in
packaging for logistical operations.
19. Warehousing
It is the back-end building for storing goods. Based on the
needs of the organization, it can be in-house or
outsourced.
Primary functions of a warehouse are product movement
and storage. Activities such as offloading of the goods
coming from the suppliers, the intermediate packaging (if
required), and shipping to other destinations (retailers or
end consumers) are handled in the warehouse. Similarly,
they can also serve as a storage house for handing peak
consumer demand to avoid stock out of items, and acts as a
buffer between the starting point (usually manufacturing
plant) and ending point (think about a typical retail outlet)
20. Information Flow
Information flow identifies specific locations within a
logistical system that have requirements. Information
also integrates the three operating areas.
The primary objective of developing and specifying
requirements is to plan and execute integrated
logistical operations.
Within individual logistics areas, different movement
requirements exist with respect to size of order,
availability of inventory, and urgency of movement.
The primary objective of information sharing is to
reconcile these differentials
21. Cont.,
It is important to stress that information requirements
parallel the actual work performed in physical distribution,
manufacturing support, and procurement. Whereas these
areas contain the actual logistics work.
information facilitates coordination of planning and control
of day-to-day operations. Without accurate information the
effort involved in the logistical system can be wasted.
Logistical information involves two major types of flows:
*coordination flows and
*operational flows.
The objective at this point is to provide an introductory
overview of the information requirements necessary to drive
an integrated logistics system.
22. Planning and Coordination Flows
Coordination is the backbone of overall information system
architecture among value chain participants. Coordination
results in plans specifying (1) strategic objectives, (2) capacity
constraints, (3) logistical requirements, (4) inventory
deployment, (5) manufacturing requirements, (6) procurement
requirements, and (7) forecasting.
The primary drivers of the overall value chain are the strategic
objectives that result from marketing and financial goals.
Strategic objectives detail the nature and location of customers,
which are matched to the required products and services to be
performed.
The financial aspect of strategic plans detail resources required
to support inventory, receivables, facilities, equipment, and
capacity.
23. • Capacity constraints coordinate internal and external manufacturing
requirements. For nonmanufacturing participants in the value chain,
this form of capacity planning is not required. Given strategic
objectives, capacities constraints identify limitations, barriers, or
bottlenecks within basic manufacturing capabilities and determine
appropriate outsource requirements.
• Logistics requirements specify the work that distribution facilities,
equipment, and labour must perform to implement the capacity plan.
Using inputs from forecasting, promotional scheduling, customer
orders, and inventory status,
• logistics requirements specify value chain performance.
• Inventory deployments are the interfaces between
planning/coordination and operations that detail the timing and
composition of where inventory will be positioned. A major concern of
deployment is to balance timing and consolidation to create efficiency
as inventory flows through the value chain.
24. Cont.,
From an information perspective, deployment specifies the
what, where, and when of the overall logistics processes. From
an operational viewpoint, inventory management is performed
as a day-to-day event.
• Procurement requirements schedule material and
components for inbound shipment to support manufacturing
requirements. In retailing and wholesaling situations,
procurement involves maintaining product supplies.
• Forecasting utilizes historical data, current activity levels,
and planning assumptions to predict future activity levels.
Logistical forecasting is generally concerned with relatively
short-term predictions (i.e., less than ninety days). The
forecasts predict periodic (usually monthly or weekly) sales
levels for each product, forming the basis of logistics
requirement and operating plans.
25. Operational Flows:
Operational Requirements The second aspect of information
requirements is concerned with directing operations to
receive, process, and ship inventory as required supporting
customer and purchasing orders. Operational information
requirements deal with (1) order management, (2) order
processing, (3) distribution operations, (4) inventory
management, (5) transportation and shipping, and (6)
procurement
Order management refers to the transmission of
requirement information between value chains members
involved in finished product distribution. The primary
activity of order management is accurate entry and
qualification of customer orders.
26. Logistic information system
Logistic information
system is nothing but a part
of Management
Information System to
manage, control and
measure the logistical
activities. These activities
occur within the
organization or as well as
overall across the supply
chain.
27. Order processing allocates inventory and assigns responsibility to
satisfy customer requirements. The traditional approach has been
to assign available inventory or planned manufacturing to
customers according to predetermined priorities.
Distribution operations involve information flows required to
facilitate and coordinate performance within logistics facilities.
The primary purpose of a logistical facility is to provide material or
product assortments to satisfy order requirements
Inventory management is concerned with using information to
implement the logistics plan as specified
28. Transportation and shipping information directs the
movement of inventory. It is also necessary to ensure that the
required transportation equipment is available when needed.
Procurement is concerned with the information necessary to
complete purchase order preparation, modification, and
release while ensuring overall supplier compliance. In many
ways, information related to procurement is similar to that
involved in order processing.
The overall purpose of operational information is to provide the
detailed data required for integrated performance of physical
distribution, manufacturing support, and procurement
operations.
29. Cont.,
Logistics concerns the flow of goods and services
facilitated by information support. In present time
machines and robots have to a large extent eliminated
manual work. With advances in information
technology, business-to-business (B2B) transactions or
business-to-customer (B2C) deals are done through
the internet. Presently logistics uses the information
resources of the enterprise and creates a database
specifically for its needs consisting of elements like
data source, users, etc.
30. Cont.,
Information Systems is an applied science for the
processes of the creation and operation of systems that
manage information. Business Process Analysis
methodologies are used for the modelling of logistic
processes and their information flows that assist in
understanding and clearly describing the information
relationships between parties and authorities and in
defining improvements to the logistic systems.
31. Cont.,
Logistics Information System (LIS) is implementation
of solutions for a system of records and reports which
may be paper based or electronic. This is a specialized
area in logistics that can handle location, work
management, and data management in organizations.
It mainly includes coordination of demand, supply,
movement, and control of material or finished goods.
32. ROLE OF LOGISTICS INFORMATION
SYSTEM
Logistics Information System (LIS) is a system of
records and reports whether paper-based or electronic,
used to aggregate, analyse, validate and display data
from all levels of logistics system that can be used to
make logistics decisions and manage the supply chain.
The role of LIS can be understood from the following:
a) LIS ensures the transformation of logistics
functional operations into a process with the goal of
pursuing customer satisfaction at the lowest cost. It
facilitates planning and control of logistics activities
related to order fulfilment.
33. Cont.,
b) LIS provides information on goods and tracks the
delivery, by giving their status.
c) Logistics systems depend on outside information
and international standards to comply with
regulations and use laid down ways of sharing logistic
information with others.
d) The manufacturers and traders monitor the actual
products to know whether they will arrive on time and
in proper condition at the delivery places, and to be
able to take prompt action in case of any lapse.
34. Cont.,
e) Transporters focus on the progress and status of the
means of transport. In case of any delays or exigencies,
transporters can report these to their customers who
can consider the impact.
f) Customs authorities and those responsible for
ensuring the safety and security of goods during
transportation are given details about the content of
goods and their means of transport.
35. LOGISTICS INFORMATION SYSTEM
MANAGEMENT
LIS is part of logistics management to manage, control
and measure the logistical activities within the
organisation and across the supply chain, achieving
logistics efficiency and effectiveness. Within an
organisation, LIS achieves the following: a) Customer
satisfaction at the lowest total cost.
b) Enables planning and control of the logistical
activities related to order fulfilment.
c) Fosters better tactical and strategic decisions for the
benefit of the firm and its customers.
36. CONT.,
d) Gives information to customers regarding product
availability, order status, and delivery schedules.
e) Enables resource planning thereby reducing the
requirements of inventory and human resources.
Logistics Management: Components
f) Provides information to top management to
formulate strategic decisions by interface with
marketing, financial, and manufacturing information
systems.
37. CONT.,
g) Links the operations of the business, such as
manufacturing and distribution, with the supplier’s
operations and the customers.
h) Facilitates ‘virtual’ inventory management or
electronic inventory management by managing
dispersed inventories through information technology.
Inventory management becomes centralized and
decisions on replenishment and other quantities are
taken based on a single stock.
38. The benefits of implementing LIS
are:
a) Improvement in customer service and satisfaction.
b) Establishing communication within the logistics
chain.
c) Reduction in stock levels and costs particularly of
transportation and storage.
d) Synchronising the processes of supply, production,
and distribution.
39. CONT.,
e) Handling the problems caused by shortage of
materials for production.
f) Improvement of delivery schedules and lessening
probable orders errors.
g) Reduction of documentation required in supply
chain management.
40. The main activities of LIS are:
a) Data flow from external sources.
b) Processing and storage of information within
companies.
c) Transmission of data for storageprocessing to the
decision maker in form of reports.
d) Communication of decisions to customers and their
feedback.
41. Human : Arteries :: Logistics :
Information
Traditional paper-based information systems are
increasingly on their way out, and electronic exchanges
are making rapid inroads into the logistical process
flow. The initial investment in electronic systems is
recouped quickly by cost savings due to better
operational efficiency and enhanced customer service.
Advances in electronic data interchange (EDI),
artificial intelligence and wireless communication is
partly responsible for this intelligent shift.
42. CONT.,
The principal information flow can be subdivided in
two main streams: one for planning (looking into the
future) and the other for operational flows (in the past
and present).
Plans are to be made for production, storage and
movement of goods. Manufacturing constraints
(internal) and expected sales (external) are the key
areas focused upon. Operating flows refer to the
information generated (or required) to serve the
orders to the customer.
43. CONT.,
Enterprise Resource Planning (ERP) is a fancy term
used by IT people for one-stop, integrated packages to
support multiple functions across an organization. It
serves as a central destination to capture data which
aids in making optimal decisions, while also serving as
a repository to better understand the current business
scenario and plan for any future needs.
44. Importance of Logistics
information systems
Logistics information systems are important for
achieving logistics efficiency and effectiveness. In an
enterprise, logistics information system seeks to
achieve the following:
It ensures of logistics functional operations into a
process pursuing customer satisfaction at the lowest
total cost.
Information system facilitates planning and control of
the logistical activities related to order fulfillment.
45. CONT.,
It makes the firm more competitive, by making better
tactical and strategic decision for the benefits of the
firm and its customer.
Helps provide customers information regarding
product availability, order status, and delivery
schedules promoting customers service.
It reduces the requirements of inventory and human
resources by enabling requirements planning.
46. CONT.,
It interfaces with marketing, financial, and
manufacturing information systems and provides
information to top management to help formulate
strategic decisions for the whole firm.
The use information technology in information
systems has enabled quick response to demand
making forecasting redundant. This has also helped in
implementing “pull” systems like just-in-time making
the firm more competitive.
47. CONT.,
It promotes systems that link the operations of the
firm, such as manufacturing and distributing, with the
suppliers operations on the one hand the customer on
the other.
48. CONT.,
In the other cases, organizations are finding that through
information they can manage dispersed inventories as if
they were single inventory. The benefits of this can be
considerable. If inventory management is centralized and
decisions on replenishment and other quantities are taken
or the basis that is a single stock, then only one safety stock
instead of many required. The stock itself can be carried
anywhere in the system, either near the point of
production or the consumption. This is the concept of
‘virtual’ inventory management or electronic inventory
management.
49. REQUIREMENTS AND
COMPONENTS :LOGISTICS
INFORMATION SYSTEM
There are three types of information systems that serve
different organisational levels.
These are operational level systems, management-
level systems, and strategic level systems.
Converting logistics data to information, representing
it in a manner useful for decision making and
interfacing the information with decision-assisting
methods are at the core of LIS.
50. There are certain requirements
which are:
a) Organisation decisions: It relates to the decisions to
be made at each level of organisation. While designing
information system, it must be ensured that the
concerned person is entitled to get required
information needed for decision making.
b) System requirement: After arriving at the decision
on collecting information, next requirement is
identification of source of information, the volume
and quality of information. A suitable channel of
communication will have to be designed to satisfy
various requirements.
51. CONT.,
c) Control requirements. Based on guidelines given by
the management, Logistics Information System
should be able to aid in decision making, minimising
delays, and increasing efficiency. Control is required to
ensure that no errors are made.
d) System input and output data.
52. CONT.,
To satisfy the demand of a customer, several activities
are undertaken by organisation which need proper
coordination. Action reports are made for the purpose
of undertaking activities based on generated
information.
Key Components of LIS is designed to manage the
flow of materials and information within and between
organisations and their business environment.
Globally information technology is a critical enabler of
the logistics supply chain networks that businesses use
to acquire, produce, and deliver goods and services.
53. The key components include:
a) Logistics Information Portal
b) Logistics Computing and Simulation
c) Decision Support System
d) Database
e) E-Logistics and E-Commerce
f) Software applications relating to Customer
Relations Management (CRM), Enterprise Resource
Planning (ERP), Radio Frequency Identification
(RFID) Tags, Transport Management System (TMS),
and Warehouse Management System (WMS)
54. Green Supply Chain Management:
Lean Practices
Green is the new way to go about things, and the myth
that profits and environment cannot go hand in hand
is evaporating fast. Commitment to lean practices is a
promise to do away with inefficiencies in the system to
reduce wastes and have a minimal impact on the
environment.
The emphasis on continuous product flows,
standardization within the organization/industries
and a greater integration between producers and
consumers — all these have contributed to efficient
supply chains with gradually decreasing waste levels.
55. CONT.,
Information is often the key differentiator when it
comes to successful supply chain practices, and the
organizations that share information with each other
based on the premise of trust and long-term business
viability will often have decisive competitive advantage
over organizations that do not share critical
information upstream and downstream.
The best part is everybody winning — organizations,
end consumers and Mother Nature.
56. Emerging technologies shaping
the future of logistics in India
Today, the transformations that India is going through
can be witnessed across all walks of life. Our industries
are getting modernized as relevant automation and
tech-adoptions are increasing their throughput while
also improving efficiency. Looking at the larger
picture, this development is adding to the market
visibility and that of across-the-board processes.
57. CONT.,
This ongoing transformation is perhaps the best for
our logistics sector, which was earlier infamous for
complicated processes, bottlenecks, and a near-
absolute opacity. So, let us have a look at the emerging
technologies that are changing the sector for good and
driving it towards the future.
58. 1) Blockchain in Logistics
Documentation (and its verification) is one of the
biggest challenges experienced by the logistics players.
This is precisely true for use cases such as
procurement, transportation management, order
tracking, and customs collaboration.
These different areas are where Blockchain – the
underlying technology that also powers
cryptocurrencies – is making a sizeable difference. For
the uninitiated, blockchain is a distributed ledger
system shared by the interacting parties or individual
stakeholders.
59. CONT.,
Its entries (in the form of blocks) are synchronized
throughout the network and cannot be altered once
registered. If any modification has to be done, another
block with the desired adjustment needs to be added to the
string of blocks. So, data fabrication is by design
impossible in the blockchain.
This aspect of the blockchain technology is today helping
us address the areas of frictional in logistics with much
simplicity. It is also optimizing the cost and the time
associated with documentation and processing for ocean
freight shipments. With a safe and protected gateway for
information-sharing, blockchain is increasing transparency
and helping us save costs by streamlining the supply chain
process.
60. 2) AI and ML for supply chain
optimization
Machine Learning, a subset of the Artificial Intelligence
technology, is also being used by logistics players to
automate the supply chain and gather insights that
otherwise remain concealed in the burgeoning data. These
insights can be directly or indirectly related to tracking, the
backend of logistics, internal functions, and so forth.
They help in optimizing supply chain as well as in
automating, streamlining, and hence, decreasing the
turnaround time of various processes. The AI-driven
approach is not only cost-effective and time-efficient, but it
also plays its part in making the consumer experience more
delightful.
61. 3) Low-to-No Asset Networks
Given the sheer focus required to manage every
process and the integration of such procedures to the
broader logistics operation, emerging logistics
providers are now entering the field of tech-driven
shipping aggregation. These aggregators do not own
any tangible assets such as fleet, cargo movers,
warehouses, etc.
They instead build a proprietary solution which is
then used by individual players (suppliers, shipping
players, etc.) as per their business models.
62. CONT.,
This tech-driven approach optimizes logistics
operations with the help of networks, technical
infrastructure, and automation to reach out to buyers
in an effective manner. Doing so also makes scattered
demand (originating from an area) visible, helps in
bundling them and transfers cost-efficiency to
businesses of all shapes and sizes.
63. 4) IoT for tracking
With the help of RFID tags, GPS, and specialized sensors,
monitoring of packages is now being done in the real-time.
Further coupled with specific approaches, such as geo-
fencing, geo-tagging, and proximity alert, more bottlenecks
are being eliminated from the supply chain.
For instance, an incoming shipment can be easily traced,
and the forward supply chain can be readied to process the
shipment faster. This practice is enhancing operational
efficiency, bringing about superior transparency, and
decreasing delays in transfers.
64. 5) Augmented Reality
High-value consignments have various security
threats, including hijacking, that need to be
eliminated. Here, Augmented Reality (alongside
facial-recognition technology) is paving the way for
secured deliveries within logistics operations.
Last-mile delivery is also improving with building-
recognition and indoor navigation. Similarly, the
completeness of a parcel and warehouse planning is
also getting enhanced with the introduction of
Augment Reality in supply chain management.
65. 6) Autonomous transport
Today, e-Vehicles such as self-driving trucks, ghost
cargo ships (autonomous ships), and drones are
driving us closer to the future of logistics. It is
estimated that this development can save up to 20% of
fuel costs by aiding transportation, warehousing
operations, and last-mile deliveries.
66. CONT.,
India has already passed its regulation for drones, and
similar frameworks are in the pipeline for other use
cases. Also, the introduction of 5G in 2020 and, with it,
the advent of logistics 4.0 are something the industry
has been looking forward to.
It is about time that the Indian logistics sector, as the
economy is booming, stands shoulder to shoulder with
its western counterparts. With the ongoing
technological revolution, it is just a matter of years,
and all we have to do is eagerly wait until this happens.
67. TOP TRENDS IN SUPPLY CHAIN
TECHNOLOGY
The highest achievement in supply chain management
was the ability to cut costs. Today, this goal is joined
with customer satisfaction, efficiency, and
sustainability. Ethical behavior plays a big part in the
strategic supply chain management decision-making
process. So while cost-reduction remains a priority, it
no longer automatically equals victory
68. CONT.,
According to Professor Scott — a leading expert in the
evolution of supply chain management — supply
chain assets are integrated. Professor Scott teaches
that modern-day supply chains “must not only deliver
customer value profitability but also work almost every
area of the business to do so—customers, suppliers,
sales and marketing, finance, and senior leadership.”
69. Supply chain managers have to innovate in every
facet of the end-to-end journey. To do this
successfully, supply chain leaders must do the
following:
Gain visibility. Real-time data for the handling of goods
and materials at any stage of the supply chain is critical for
effective management. Supply chain visibility lets
companies assure consumers that the products they're
buying are sustainably sourced from both an
environmental and social perspective. Just ask H&M, which
recently released its supplier factory map. Customers are
able to make more informed decisions about their buying
practices. Having this data enables companies to maintain
control, enforce policies and laws, and respond quickly to
problems before they escalate.
70. Predict the future
Predict the future. It’s not a crystal ball, but
predictive strategies anticipate patterns to proactively
resolve issues before they occur, meet demands
without overstocking, and minimize costs. With
the current trade environment, shippers must be
prepared for anything. One way to tackle this is by
having sophisticated systems in place that increase
options when a supplier is unavailable.
71. Hire data teams
Hire data teams. A successful future in supply chain
management requires robust technological
investment, but not just at the material level. Without
dedicated human resources for data teams,
organizations fall short. That’s because supply chain
data teams offer a range of dynamic advantages
beyond implementing new systems. They thoughtfully
analyze data, produce insights, and recommend
growth strategies in the full context of the business’s
needs.
72. Innovative supply chain
technology tools
Staying competitive in supply chain management requires
adopting the most advanced technology. Mary Long,
director of the Supply Chain Forum, says, “It takes an
understanding in knowing what to go after to create supply
chain efficiencies.” Enterprises such as the Kraft Heinz
Company (the third-largest food and beverage company in
North America) and McCormick & Co.
(Baltimore-based maker of spices and seasonings) invest
in technology to create efficient, sustainable, and socially
responsible supply chains. Both companies are designated
as a “Shipper of Choice” by FreightWaves, an award that
ranks the “industry’s most innovative and/or disruptive
companies.”
73. Here are some of the emerging
technological trends, tools, and
innovations used in supply chain
management
Big data. Massive amounts of data are generated every
single day. Each minute, 4.5 million searches are entered in
Google, 18.1 million text messages are delivered, and 188
million emails are sent. Mobile devices such as wearables,
smartphones, and tablets generate a significant amount of
the total data usage each day.
With so much information at our disposal, it takes complex
computing techniques to gather, sort, clean, and analyze
such large data sets. Data science and analytics allow
companies to use data to gain valuable insights and
revolutionize supply chain management.
74. Artificial intelligence and machine
learning.
AI and machine learning create fully- or semi-automated
processes and procedures for supply chain optimization.
Optimization improves forecasting, planning, implementation,
and maintenance in logistics by using AI and machine learning
to emulate human performance and knowledge. AI and machine
learning boost the end-to-end supply chain by:
Tightening data security;
Applying predictive modeling to third-party logistics;
Providing full supply chain visibility to improve management of
key performance indicators (KPI);
Automating inventory management, shipping transactions, and
delivery routing; and
Improving customer service.
75. Internet of things (IoT).
The IoT — the streamlined connection across various
devices — increases visibility and connectivity, while
also reducing costs. Wearables and mobile devices like
Apple Watches, Fitbits, and smartphones,
are especially useful in warehouse settings. Wearables,
in particular, provide solutions that lead to having a
"touchless" supply chain: the total elimination of the
labor-intensive selection of items from inventory to
fulfill a customer order, also known as “picking.”
76. Other IoTs allow warehouse and
logistics managers to securely track
inventory and monitor equipment.
Other benefits include:
Improved asset utilization;
Better customer service;
Streamlined inventory and supply availability; and
Safer and more reliable work environments.
77. CONT.,
5Gs. According to Qualcomm, 5G is foundational to
further innovation, which is certainly the case when it
comes to supply chain management. Gaining real-time
data is difficult when suppliers lack connectivity.
Supply chain visibility becomes spotty without 5G.
And third-party logistics is made possible through the
use of 5G because it elevates mobile networks through
multi-Gbps peak rates, ultra-low latency, and massive
data capacity. High-level performance, increased
efficiency, and new user experiences become available
when 5G interconnects people, machines, objects, and
devices.
78. . 5G further offers the power to:
Extract larger amounts of data concerning location,
temperature, pressure, and other information that is
critical in the end-to-end supply chain;
Ensure uniformity of information sharing with all
stakeholders;
Resolve issues that would otherwise be aggravated
with time delays; and
Understand exactly where raw materials come from.
79. CONT.,
The Cloud. At any point during the end-to-end supply
chain, companies track materials and products, get
real-time updates, and inform customers of the status
of an order. This is all made possible with cloud
computing. Cloud-based solutions enhance a number
of areas such as data storage space, integration,
security, and information sharing. Activities and
processes are streamlined between multiple devices
and an enterprise of software users.
80. CONT.,
Advanced supply chain management software.
Advanced software has disrupted the entire supply chain
industry. In order to stay competitive, logistics companies
continue to incorporate technology into their supply chain
systems. Businesses feel compelled to track the latest
technologies on the market because of consumer demands
on cost and delivery speed, and the increasing popularity of
customer rating metrics. As technology advances, supply
chain software becomes more complex, allowing
companies to stay ahead of mistakes, make modifications
to orders, communicate across various media channels, and
automate shipping
81. Growth of Logistics and Supply Chain
Management in national and
international scenarios.
India is facing several challenges amid country-wide
lockdown. Many industries have been severely
affected. One of them is logistics and supply chain
management. Shortage of labour, cargo capacity
challenges, the slowdown in manufacturing, order
delays, stuck shipments as well as demand and supply
shocks have affected the logistics segment to the core.
82. CONT.,
Due to lockdown in surrounding countries, minimal
export-import movements during this time have
amplified the crisis in the logistics space. Restrictions
on air travel and international flights globally have
contributed to the slowdown in the movement of
goods and brought first and last-mile transportation
and intermodal movement of goods to a standstill.
Reduction in the capacity of vessels and shortages in
the equipment to deliver the goods, related to
disruptions has had a major impact on the intra-Asia
trade lanes
83. CONT.,
But in a post-COVID-19 world, the scenario of logistics
and supply chain segment will be totally different and
supply chain stress tests will become a new norm.
India’s supply chains will go through huge
transformations to challenge the demand and supply
frameworks in the coming few years. Also, people are
responding in a variety of ways and having different
attitudes, behaviours and purchasing habits.
84. CONT.,
To prevent the spread of the virus, the number of
touch-points any product goes through during the
entire supply chain—from production to handling till
the doorstep of businesses and homes—will be
reduced drastically. Rapid automation in handling
systems and management including palletization of
cargo, conveyor systems, robotics, drones and drop
boxes amongst others would go through an accelerated
trend. A rapid shift towards omnichannel procurement
would be a new trend once the lockdown is completely
lifted.
85. CONT.,
But in a post-COVID-19 world, the scenario of logistics
and supply chain segment will be totally different and
supply chain stress tests will become a new norm.
India’s supply chains will go through huge
transformations to challenge the demand and supply
frameworks in the coming few years. Also, people are
responding in a variety of ways and having different
attitudes, behaviours and purchasing habits.