1. Chapter 10
Strategic Technology and Enterprise Systems Part 2 – Supply Chain Management
The journey that a product travels, starting with raw material suppliers and then to manufacturers or assemblers, distributors and retail shelves, and ultimately to customers is its supply chain. The supply chain is like a pipeline composed of multiple suppliers, distributors, manufacturers, retailers, and logistics providers.

2. Objective
Explain the planning and forecasting, sourcing and purchasing and distribution support provided by supply chain management SCM) systems.
The objective of Part 2 of Chapter 10 is explain the planning and forecasting, sourcing and purchasing and distribution support provided by supply chain management (SCM) systems.

3. Supply Chain Management Systems
Starts with the acquisition of raw materials or the procurement (purchase) of products and proceeds through manufacture, transport, and delivery—and the disposal or recycling of products.
Supply Chain Management or SCM software supports the steps in the supply chain—procurement, sourcing, manufacturing, storage, inventory control, scheduling, order fulfillment, and distribution. SCM improves decision making, forecasting, optimization, and analysis.

4. Supply Chain Management Systems
Supply Chain Flows
Material or product flow: the movement of materials and goods from a supplier to its consumer.
Information flow: the movement of detailed data among members of the supply chain, for example, order information, customer information, order fulfillment, delivery status, and proof-of-delivery confirmation.
Financial flow: the transfer of payments and financial arrangements.
Supply chains involve the flow of materials, data, and money. Material or product flow is the movement of materials and goods from a supplier to its consumer. Information flow is the movement of detailed data among members of the supply chain such as order information, customer information, order fulfillment, delivery status, and proof-of-delivery confirmation. Most information flows are done electronically. Financial flow is the transfer of payments and financial arrangements with billing, payment schedules, credit terms, and payments via electronic funds transfer or EFT.

5. Goals of Supply Chain Management Systems
SCM systems are configured to achieve the following business goals:
To reduce uncertainty and variability in order to improve the accuracy of forecasting.
To increase control over processes in order to achieve optimal inventory levels, cycle time, and customer service.
Goals of supply chain management systems are to reduce uncertainty and variability in order to improve the accuracy of forecasting and to increase control over processes in order to achieve optimal inventory levels, cycle time, and customer service.

6. Supply Chain Management Systems
Order Fulfillment
Part of back-office operations, such as accounting, inventory management, and shipping; and closely related to front-office operations or customer-facing activities with the key aspect as delivery of materials or products at the right time, to the right place, and at the right cost. Part of logistics.
Logistics
Logistics entails all the processes and information needed to move products from origin to destination efficiently.
Order fulfillment is the set of complex processes involved in providing customers with what they have ordered on time and all related customer services. Order-fulfillment is part of back-office operations, such as accounting, inventory management, and shipping—and is closely related to front-office operations or customer facing activities. The key aspects of order fulfillment are the delivery of materials or products at the right time, to the right place, and at the right cost. Logistics entails all the processes and information to move products from origin to destination efficiently.

7. Order Fulfillment Steps
Step 1: Make sure the customer will pay. Step 2: Check in-stock availability and reorder as necessary. Step 3: Arrange shipments. Step 4: Insurance. Step 5: Replenishment. Step 6: In-house production. Step 7: Use suppliers. Step 8: Contacts with customers. Step 9: Returns.
The order fulfillment process starts when an order is received, and includes the following nine activities that are supported by SCM software or are automated: Step 1: Make sure the customer will pay. Step 2: Check in-stock availability and reorder as necessary. Step 3: Arrange shipments. Step 4: Insurance. Step 5: Replenishment. Step 6: In-house production. Step 7: Use suppliers. Step 8: Contacts with customers. And, Step 9: Returns.

8. Innovations and Barriers Driving SCM
Top two strategic priorities of executives
Supply chain analytics
Multichannel fulfillment
Major two major barriers preventing innovation in the supply chain are
Talent shortage
Continuing focus on cost reduction chokes off essential investments in innovation
Squeezes out innovations in sustainability.
Key findings in a study completed in 2014 revealed that the top two strategic priorities of executives are supply chain analytics and multichannel fulfillment. Companies want to leverage analytics that produce insights to improve customer service and reduce costs and risk. Retailers plan to make significant investments to build multi-channel fulfillment capabilities to meet the demands of today’s customers that expect 24/7 shopping and have their goods delivered quickly. One barrier preventing innovation in the supply chain is the difficulty in finding talented labor with supply chain talent and skills. The continuing focus on cost reduction chokes off essential investments in innovation and innovations in sustainability.

9. Supply Chain Technology
Mobility and mobile-to-mobile (M2M) technologies improving responsiveness and customer service.
3D printing could have far-reaching implications, but immediate potential remains unrealized.
Supply chain technologies improve responsiveness and customer service. Mobile-to-mobile (M2M) contribute to this. 3D Printing or additive manufacturing could revolutionize production processes and have far-reaching future implications for product supply chains.

10. The End!
This concludes our discussion of Part 2 of Chapter 10 on Supply Chain Management.