SCM Technologies and Their Applicability in The SC Operations
SCM Technologies and Their Applicability in The SC Operations
SCM Technologies and Their Applicability in The SC Operations
Adil Ummer
E-mail: [email protected]
Abstract:
Introduction
Today’s competitive marketplace means there’s less room for inefficiency, but the good news
is supply chain technology can simplify and optimize your business processes. That’s why
it’s imperative for companies to continually innovate and streamline their supply chain, and
software likely provides the greatest bang for the buck.
The right service supply chain technology enables your company to create greater visibility
within your supply chain, gain more control over your inventory, reduce operating costs, and,
ultimately, outpace the competition.
Here’s how tech and platforms designed for the supply chain can provide your company with
a more stable and efficient supply chain that enhances customer satisfaction and retention.
Mobile apps are able to remarkably improve the communication velocity . The usage of
mobile application while moving eliminates paper-based work flows and can speed up the
processes greatly. Furthermore, electronic signature and the information of delivery (time,
person, place etc.) via mobile devices enrich supply chain management with more effective
and arranged information processes. In the meanwhile, instantaneous data transfer provides
the execution speed throughout the supply chain by means of performing information
available in a real-time. Besides it connects different concerned departments or work groups
directly with the notifications and alert mechanisms in urgent situations. Finally, order-
todelivery time is shorter and service management responses more quickly with the help of
mobile information.
Supply chains cover from manufacturing to customer relationship and include manufacturer,
supplier, transporter, warehouse, retailer, and customer segments. Possible usage of mobile
internet-connected devices will be explained deeply at this part of the paper. Customers can
use their mobile internet-connected devices, generally smartphones, to buy product via
internet instead of buying from physical stores. In a short time, it will be ordinary behaviour
to check the product price on internet before visiting a physical store to purchase a product,
or check the price of the product on internet using smartphone while in physical store, and
purchase the product on the internet if it is cheaper than that in physical store before leaving
there. These examples can be extended. With the help of recent technological advances
especially in mobile internet connection, boundaries between traditional and internet retailing
blurs. This evolution from brick and mortar model to internet model opens up new and
limitless dimensions for customers to buy product.
Mobile applications have remarkably grown especially with the uptrend of smart phones and
tablets in the market. Applications which are compatible with operate just like computer
programs to handle some specific jobs in the mobile devices. Nowadays apps continue to
extend their usage areas for individual users and also lots of companies from various
industries. The adoption of the applications is really significant for the firms to keep up-to-
date and follow trends in the market. Firstly, the most prominent advantage of these apps in
SCM is having feature of location independence via mobile communication networks such as
3G and 4G anywhere as an important opportunity of mobility . Moreover, mobile
applications seem very useful for each level in the supply chain management. It means that
mobile apps can be utilized by the managers, workers engineers, drivers, and technicians etc.
who are involved in this chain covering high, middle and low level employees in the
companies . In addition, mobile SCM apps enable information flow between different
business functions throughout the supply chain. So, product flow is healthier when reaching
to the final consumer in this way . According to Umney (2011), mobile technologies and
applications provide companies many advantages with the help of speedy decision making,
increasing productivity and reasonable costs. Besides, new generation of mobile
communication helps SCM apps to enhance their usage by improving mobile or WiFi
coverage. Mobile SCM applications are classified as given in a matrix by Ruhi and Turel
(2005). Bearer technologies and their relevant value chain activites can be seen in Appendix
A. They classifies the activities as logistics, operations, marketing & sales and service and
then list mobile SCM applications in the table with respect to their bearer technologies. It
seems one of the most prominent taxonomies given in the literature so far. According to
Jenkins (2013), mobile SCM applications enable employees to be snychronized with the help
of real time flow in the supply chain management. It seems an important factor to track all the
process at the right time
2.RFID
RFID stands for “radio frequency identification”. It’s a technology that captures digital data
encoded in smart labels and RFID tags through a reader via radio waves.RFID serves a
similar purpose to that of bar code or a magnetic strip of an ATM card where data from a
label or tag is captured by the device and then later stored in the database.However, RFID
works better than barcode and ATM magnetic strips. The most significant advantage of using
RFID over barcode is that it doesn’t need to be placed or positioned relatively to the
scanner.The other advantage is that with RFID you can scan more than one object at a time
unlike barcode which saves loads of time and energy.RFID belongs to a group of
technologies referred to as Automatic Identification and Data Capture (AIDC).
AIDC methods automatically identify objects, collect data about them, and enter those data
directly into computer systems with little or no human intervention. RFID methods utilize
radio waves to accomplish this.At a simple level, RFID systems consist of three components:
an RFID tag or smart label, an RFID reader, and an antenna.RFID tags contain an integrated
circuit and an antenna, which is used to transmit data to the RFID reader (also called an
interrogator).The reader then converts the radio waves to a more usable form of data.
Information collected from the tags is then transferred through a communications interface to
a host computer system, where the data can be stored in a database and analyzed later.RFID
in supply chain management and logistics
Supply chain management and logistics are considered as the most fertile field as far as the
applications of RFID is concerned.RFID in the supply chain plays a major role in enhancing
the visibility right from the point of manufacturing, via supply chain, and most significantly
from the back room to the floor, and ultimately to the exit door.RFID has a major say when it
comes to inventory management, warehouse management, and retail sector. Let’s see in
detail about them all.
Warehouses are simply storage area where you store different products received from the
suppliers. These products are then distributed to the customers.Recently, RFID has emerged
as a technology that supports warehouse management system for simpler supply chain and
greater product intelligibility.With RFID technology you can automate important tasks which
take place during receiving and shipping processes.RFID also increases efficiency of
identification and validation activities along with reducing human errors.RFID ensures
identification of products at an instant and greater control over items in the warehouse.
Due to this the supply chains now have a greater information flow as compared to the
material flow. This further reduces currency cost.Peerbits have developed a solution for
warehouse management system using RFID technology. Click on the below video to see how
it works.
Chatbots in logistics can assist with the operational aspect of a business where the data comes
from multiple sources. Chatbots can help in collecting the data from multiple sources while
simplifying and automating processes at the same time.
3.1Managing Orders
Managing customers’ orders is a big task as a different state of orders can present a big
challenge in collecting and managing all the data.Managing new orders, orders in progress,
canceled orders, delayed orders, unclaimed orders, and orders for replacement/change can be
tiresome for managers but not for the chatbots. They can send the collected data directly to the
databases that are again automated for classifying the information accordingly.
3.2Warehouse Issues
Warehouse matters are another important aspect that requires adequate management. Using
automation in warehouse management can be helpful in dealing with inventories, expected
deliveries, floor plans, and tracking information.Here, the chatbots can be deployed for
potential and existing clients/suppliers who can check the warehouse location and additional
details so that they can maintain clear communication.
The information about delivery/supply fleet such as the number of vehicles, vehicles on the
route, idle vehicles, vehicles under maintenance, and vehicles that are out of order can be
updated on automated terminals that provide such information.The company can also add a
limited-access feature for security purposes. Chatbots can fetch this information and offer
assistance directly to the potential/existing clients and customers. Such an automated approach
will also be helpful in managing and maintaining the company database for every single order.
In the supply-chain management, companies rely heavily on drivers for delivering and
bringing-in the products/goods. Here, internal chatbots that can access driver information such
as persons on sick leave/vacation, currently working, or standby can be vital as they can offer
vital information to the managers who can then manage deliveries as per the available
manpower and vehicles.
4. Blockchain in SCM
4 Artificial Intelligence
Artificial intelligence is taking up the pace when it comes to global logistics and supply chain
management. As per a number of executives from the transportation industry, these fields are
expected to go through a more significant transformation. The on-going evolution in the areas
of technologies like artificial intelligence, machine learning, and similar new technologies is
said to possess the potential to bring in disruption and lead innovation within these industries.
Artificial intelligence comes with computing techniques which helps to select large quantities
of data that is collected from logistics and supply chain. You can put such methods to use,
and they can be analyzed to get results which can initiate processes and complex functions.
Many organizations have now been benefitted with investments in artificial intelligence. As
per Adobe, currently, 15% have already started to use AI while other 31% plans to have them
implemented in 2019. Some of the areas from which revenue can be generated are research
and development, product innovation, supply chain operations, and customer service.
To avoid risks, anticipate events and come up with solutions, now techs are using data. The
data helps companies to use their resources in the right way for maximum benefits, and
artificial intelligence helps them with it more accurate and faster manner.
4.1.2 Robotics.
You cannot talk about artificial intelligence without mentioning robotics. Even though
robotics is considered as a futuristic technology concept, the supply chain already makes use
of it. They are used to track, locate and move inventory within the warehouses. Such robots
come with deep learning algorithms which helps the robots make autonomous decisions
regarding the different processes that are performed in the warehouse.
For AI in the logistics industry, coming up with clean data is a huge step, and they cannot
implement without having such usable figures. It is not easy to measure efficiency as data
comes from different sources. At the source level it is not possible to improve such data, and
so algorithms are used to analyze data, enhance the quality of data, identify issues to attain
transparency which can be used for business benefits.
4.1.4 Computer vision.
When you are moving cargo across the world, it is always good to have a pair of eyes to
monitor, and it can be best when it comes with state-of-the-art technology. Now you can see
things in a new way by using computer vision which is based on artificial intelligence for the
logistics.
In order to achieve lower fuel consumption, better-driving systems are coming up which
works on to bring together multiple trucks to have formations. Computers control such
formations and they are connected with one another too. Such kind of configuration is said to
help the trucks save fuel distinctively.
Companies make use of AI along with machine learning to get new insights into different
areas which include warehouse management, logistics and supply chain management. Some
of the technologies used in these areas are AI-powered Visual Inspection to identify damage
and carry out needed correction by taking photos of the cargo by using special cameras and
Intelligent Robotic Sorting to sort palletized shipments, parcels and letters.
The Internet of Things (IoT) is a collection of interconnected physical devices that can
monitor, report on and send and exchange data. IoT devices are typically connected to
computer systems via data or Wi-Fi networks.
IoT devices use sensors to measure specific aspects of the world around them, including
location, temperature, humidity, light levels, movement, handling, speed of movement and
other environmental factors. IoT devices come in many form factors including RFID chips,
smart devices and mobile sensors.
In the supply chain, Internet of Things devices are an effective way to track and authenticate
products and shipments using GPS and other technologies. They can also monitor the storage
conditions of products which enhances quality management throughout the supply chain.
IoT devices have revolutionized supply chain management (SCM). It’s much easier to
understand where goods are, how they are being stored and when they can be expected at a
specific location.
IoT devices can be attached to specific storage containers or to raw materials or products
themselves. The IoT device will transmit its location, which can be picked up by GPS
satellites and used to track movement of goods.
5 . 1 . 2T rack S p eed of Movemen t an d Wh en Good s Wi l l Arri ve
Tracking speed of movement and the traffic flow of products makes it much easier to predict
how goods will move through the supply chain. Suppliers, manufacturers and distribution
centers can prepare to receive goods, which reduces handling times and ensures the efficient
processing of materials.
5.1.3 Mon i tor S torage Condi tion s of Raw Materials and Produ cts
Some goods like food and chemicals need to be stored in ideal conditions. Specialist IoT
devices can monitor areas like temperature, humidity, exposure to an atmosphere, light
intensity and other environmental factors. These devices may even trigger an alarm if certain
thresholds are breached. This makes it much easier to track the quality of goods through the
supply chain and to reduce spoilage.
Goods tracking and route planning through IoT devices can identify where and when goods
are delayed in transit. This allows for contingency planning and alternative routes to speed up
the supply chain.
Goods can remain tagged with IoT devices when they are in a distribution center. This can
make it much easier to find specific products within a large warehouse and ensures accurate
identification and management of goods.
Verified tracking through IoT devices means that SCM can validate exactly when goods
arrive. This can trigger other administrative tasks like supplier payments or onward shipping
requests.
6 .Digital Twin
Digital twin is a technology many suppliers and manufacturers will need to consider in
coming years. But what is digital twin technology? Essentially, it is a digital replica of a
product, process or service. The technology acts as a bridge between the digital world and
physical reality by using sophisticated sensors on physical components to gather data such as
working condition, real-time status, or position.
A real-life example of digital twin technology can already be seen in some modern cars.
Historically, car owners would visit the repairman once something broke in the car and now
needs to be repaired or for regular maintenance inspections to prevent the car from
malfunctioning. Now, digital twin technology can reduce the cost of repair and downtime of
your vehicle by having your car tell you when any of its parts are about to break down
through a digital twin. Car owners with digital twin technology implemented would not get
stranded because the engine broke or have to go to a routine inspection to replace a part that
will actually work for another year.
For dealers, digital twin technology can optimize stock and reduce lead times by exchanging
data with the cars to know ahead of time when the car will break down. This way,
replacement parts can be ordered ahead of time to be ready for when car owners take their car
into the shop.
The rising integration of drones and smart glasses in the logistics industry has improved the
flexibility and speed of delivery, in turn, impacting the growth of last mile logistics market
during the predicted period. Self-driving vehicles, autonomous vehicles and trucks have been
able to maintain high reliability and same-day delivery in both urban and rural areas.
Furthermore, integration with smart glasses backed by augmented reality will make deliveries
in the transportation and logistics industry much easier by hands-free route searches, face
recognition for error-free deliveries and personalized deliveries. The adoption of AI
integrated smart glasses will increase the operational efficiency of first and last mile logistics
along with flexibility and speed of delivery.
The use of Big Data and Data Analytics in the logistics industry is allowing several
stakeholders involved in the business to make informed purchase decisions. Companies are
now using big data to anticipate busy periods, potential future supply shortage and other
insights for making strategic decisions to improve their market positions and offer a
significant competitive advantage over other counterparts. Furthermore, as per the Council of
Supply Chain Management Professionals, over 90% of shippers and third-party logistics
firms predict that data-driven decision-making is extremely crucial to supply chain activities
as the big data improves quality and performance by offering effective supply and demand
forecast, inventory management, route optimization, and efficient labor management, in turn,
boosting the growth of the global third-party logistics market during the predicted period.
The integration of Supply chain management and ERP allows manufacturing and distribution
businesses the ability to gain greater visibility into all operations while increasing speed,
efficiency and overall customer satisfaction.
The feature-rich working environment of ERP combined with the more streamlined and
efficient workflow of an effective SCM can provide a range of important advantages,
including:
Improved efficiency across multiple departments and organizations working within the
supply chain
Improved customer service for increased customer retention and greater chance of repeat
business opportunities
Automation of workflow for reduced overhead and operational costs
IT issues and problems that are less likely to create bottlenecks to impede efficiency
More flexible supply chain solutions that may be readily adapted to meet the needs of
changing circumstances or future business growth and expansion
Supply chain planning includes the selection of marketing channels, promotions, determining
the quantities of stock and inventory required and ensuring replenishment and production
policies are able to keep up with demand. ERP systems offer an easier and more flexible way
to establish and alter the parameters within which a supply chain is required to operate.
Feature-rich ERP software applications provide a more effective way to handle procurement
and supply of the goods, services and other resources that are needed across the supply chain.
From manufacturing and warehouse resources to transportation and execution processes, ERP
systems offer cross-platform visibility on all aspects of the supply chain.
9.4. Monitoring and Maintenance
The ability to monitor, review and alter supply chain efforts and activities in real-time is
essential for ensuring your business is able to maintain the flexibility needed to stay
competitive and ensure cost-effective operations.
Comparing actual activity against projected goals and targets can be all but impossible for
those who rely upon a supply chain that utilizes multiple stand-alone systems and workflow
processes. ERP systems offer superior information aggregation and organization to ensure
that any undesirable variances throughout the supply chain are quickly identified and
effectively addressed.
Robotic process automation (RPA) allows an organization to deploy smart software bots that will
automate common operational processes throughout the business. These bots are intelligent agents
that can learn how specific tasks are performed and then repeat those tasks, eliminating human error
and reducing overhead. Supply chain management (SCM) uses robotic process automation to
automate common, low-value tasks, which streamlines operations in the supply chain and removes
human error. RPA allows supply chains to scale up faster so that they can meet supply requirements
as demand increases.
1 0. 1 H ow RP A R el at e s t o t he S up pl y Ch ai n
Raising, responding to and processing purchase orders is a significant administrative overhead for
suppliers, manufacturers and retailers. Robotic process automation identifies required inventory levels
and matches them against actual stock. RPA will then raise purchase orders that travel up the supply
chain without relying on human intervention.
Organizations often have questions of suppliers and other stakeholders further up the supply chain.
Those stakeholders use a combination of NLP and RPA to parse, understand and respond to questions
and requests for quotes or proposals. This results in faster turnaround and more accurate responses to
common queries.
Robotic process automation generates lots of data. This data is analyzed to identify how processes can
be enhanced further, resulting in greater efficiencies, reduced waste, higher quality and fewer delays.
When combined with predictive or prescriptive analytics, robotic process automation becomes part of
a continual improvement process that streamlines the supply chain.
10.1.4Seamless Integration With Other Supply Chain Systems and Tools
The efficiencies of robotic process automation aren’t limited to one platform or organization. True
RPA will integrate with and work across multiple software, systems and tools used by stakeholders
throughout the supply chain. This reduces duplication and increases speed and quality for all
suppliers, manufacturers, retailers and other organizations.
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