Supply Chain Management Software | Eliminating the Bullwhip!
Supply Chain Management Software | Eliminating the Bullwhip!
Using Supply Chain Management Software to eliminate the bullwhip effect! Stop, I was just kidding. There is no SCM software out there that can eliminate the bullwhip effect entirely. This doesn’t mean not to invest some company money into a supply chain system.
We’re in a bad time (2008 Recession) when supply risks loom larger than ever, many companies lack strategic approaches to manage that risk and ensure supply continuity. Many companies are either stocking too much or stocking too less of goods. This fact, combined with the increasingly global nature of today’s business climate, makes supply management a daunting task for every organization that procures goods and services.
To gain success, this requires continuous collaboration among purchasing, engineering, supply operations, and vendor personnel. Companies must reduce complexity in their supply chains to maximize margins and launch products with agility. Sourcing processes need to be streamlined to optimize direct material costs and enable the supply base to support and respond to changing needs.
Designed with these best business practices in mind, supply chain management software combine supplier relationship management (SRM) processes with collaboration and procurement processes that cut across time-horizon, functional, and geographical boundaries.
The best example I can give you about 2 companies that have worked on SCM to the finest in any industry is, Wal Mart and Proctor and Gamble. They use just in time (JIT) systems, and etc. These two companies are the pioneers in SCM.
Supply Management solutions generally allow you to manage the product costs through the overall product life cycle, with the capability to define target costs and compare them with actual costs. The solution enables costs to be loaded in for components and sub-assemblies from various internal or supplier-provided inputs and can perform multi-tier cost roll-up to the product level. The cost elements not only incorporate sourcing or supplier prices but additional transformation and uplift costs like assembly, manufacturing, and transportation costs. This gives users the ability to view the total product costs with their elements and drive actual costs to meet targets over the product realization cycle. Through these processes and the ability to examine and compare prices from multiple suppliers, users can align costs with margin targets, retaining market share and overall profitability.
To name some of the benefits of using a Supply Management Software:
Reduced direct material spend, Increased compliance, Reduced inbound supply chain and logistics costs, Improved user productivity, Decreased inventory, Increased revenue potential, and Shorter cash-to-cash cycles.
Here’s some of the industry leaders you may want to have a look at in depth:
Capterra, Cognos, Microsoft, IBM, Logility. There are many more, just spend sometime using the free SCM software out there first before deciding on which one you want to purchase. Keep in mind a good SCM system should be customizable to your companies needs prior to implementation. Good luck.
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