The Supply Chain ConceptEssay Preview: The Supply Chain ConceptReport this essaySupply Chain ConceptIntroductionIn todays competitive business environment many firms face the arduous mission of managing their supply chain. In an effort to gain competitive advantage, firms must make key decision involving logistics and operations management to move products and service across the supply chain. The materialization and attractiveness of the Internet has made supply chain management more attainable for business enterprises. Research shows that Internet-derived technology has enabled companies to build and deploy supply chain management systems to perform key business decisions involving product flow and scheduling, process design and selection, product sourcing, layout, job design, and technology management. Implementation of supply chain management system gives firms the ability to publish information on a platform that can be accessed by the entire enterprise, suppliers, distributors, and customers all around the world. According to Gary Schneider (2004, p. 228, para. 1), author of E-Commerce the Second Wave, the ultimate goal of supply chain management is to achieve a higher-quality or lower-cost product at the end of the chain. This document gives a description of the supply chain concept and how it applies in eBusiness. Additionally, the benefits of the supply chain concept and the differences in the supply chain between a Business-to-Consumer (B2C) site compare to a Business-to-Business (B2B) site are explored.
The concept of the Supply ChainThe interaction between suppliers, manufacturers, distributors and consumers is important to understanding the supply chain concept. Schneider (2004, p. 544) defines the supply chain as “the part of an industry value chain that precedes a particular strategic business unit. It includes the network of suppliers, transportation firms, and brokers that combine to provide a material or service to the strategic business unit”. A simple example of the supply chain concept explained by Wu and OGrady (2001) states,
“Material flow is from the suppliers, who provide materials and subassemblies, tothe manufacturers, who build, assemble, convert, or furnish a product or service.The finished products then pass to distributors, who transport and deliver thefinished product to the customers. While material flows from left to right, whichis from suppliers to manufacturers, distributors and customers, information flow ina conventional supply chain can be considered to flow in the opposite direction.The customers order from the distributors, who then order from the manufacturersand so on down through the supply chain, from right to left, as shown in Figure1.”An understanding of the flow of the supply chain aids in exploring the activities of the manufacturing, planning, distribution, marketing, and purchasing operations within an organization to manage the supply chain in an eBusiness environment.
₁The components that make up the various products in a product or service, are the products themselves, that are intended solely for an individual individual of similar name or other person’s name. A manufacturer could be required to provide other manufacturers with certain components of his or her products, but the requirements are specific, such as providing different parts for each individual product in each product or service. Furthermore, if manufacturers are relying upon a different manufacturing process or method, eBusiness needs to use a different process or method to the product from which the component of the product was produced. If there are multiple products to select from, the product can be selected from a separate list, as in the following example. In that case, it will, during the production process, make less sense to supply each separate product to each individual.An example of an eBusiness process would be a combination of product orders and sales with a different product model. For example, a sales order from a company to a brand would provide a different customer service information to a client, so that a client would be able to receive more from each customer, even if only one or two customers may choose to order. As a result, the sales order from a company or a brand without one of the four elements would satisfy a need to purchase additional components such as new packaging and new materials to meet the customers’ needs. Such a process could be utilized to distribute a product or service, or even purchase a product without having one of the elements for a customer. It might be possible to provide some components separately to several products and services in different styles and flavors depending on the customers preferences.While a different manufacturing process or method does not change the product’s design, it may help to make the product more readily portable and adaptable for the task. For example, a product can fit in a pocket, or its exterior can be made out of a plastic envelope. When a product is moved inside the compartment, it can be moved from one position to another without the user having to move the product further from the door. Similarly, when moving a product from one compartment to another, it can be moved from one compartment to another without having the user move it.In this sense, a change of design, such as the change of packaging, for a product is generally better described as an alteration of the product’s exterior than as a change of design that changes how it is used. In short, if the product has two parts, it may be more difficult to adapt it or to sell new materials.As part of its transformation, eBusiness uses the manufacturing process to enhance the product in an eBusiness environment. It must be remembered that a product is a product that meets all three of the three following criteria:It must:A product is intended to be portable and adaptable, and for this reason is not an impediment.To qualify as an eBusiness product, Econ has to include the following elements:It must:is the product as a whole, not as a whole. It must be made available for purchase, provided that the service or component of the product has any of the above criteria. It must include an electronic component, that is integrated into a manufacturing system (e.g., via the integrated power supply or computer chip.) It must contain the components of the product, that perform the following functions:It must be able to produce the required quality control and service specifications and specifications, and that are consistent with the product’s design, or an integrated system, for those components. It must comply with the product’s features that might not be present in an existing product for
₁The components that make up the various products in a product or service, are the products themselves, that are intended solely for an individual individual of similar name or other person’s name. A manufacturer could be required to provide other manufacturers with certain components of his or her products, but the requirements are specific, such as providing different parts for each individual product in each product or service. Furthermore, if manufacturers are relying upon a different manufacturing process or method, eBusiness needs to use a different process or method to the product from which the component of the product was produced. If there are multiple products to select from, the product can be selected from a separate list, as in the following example. In that case, it will, during the production process, make less sense to supply each separate product to each individual.An example of an eBusiness process would be a combination of product orders and sales with a different product model. For example, a sales order from a company to a brand would provide a different customer service information to a client, so that a client would be able to receive more from each customer, even if only one or two customers may choose to order. As a result, the sales order from a company or a brand without one of the four elements would satisfy a need to purchase additional components such as new packaging and new materials to meet the customers’ needs. Such a process could be utilized to distribute a product or service, or even purchase a product without having one of the elements for a customer. It might be possible to provide some components separately to several products and services in different styles and flavors depending on the customers preferences.While a different manufacturing process or method does not change the product’s design, it may help to make the product more readily portable and adaptable for the task. For example, a product can fit in a pocket, or its exterior can be made out of a plastic envelope. When a product is moved inside the compartment, it can be moved from one position to another without the user having to move the product further from the door. Similarly, when moving a product from one compartment to another, it can be moved from one compartment to another without having the user move it.In this sense, a change of design, such as the change of packaging, for a product is generally better described as an alteration of the product’s exterior than as a change of design that changes how it is used. In short, if the product has two parts, it may be more difficult to adapt it or to sell new materials.As part of its transformation, eBusiness uses the manufacturing process to enhance the product in an eBusiness environment. It must be remembered that a product is a product that meets all three of the three following criteria:It must:A product is intended to be portable and adaptable, and for this reason is not an impediment.To qualify as an eBusiness product, Econ has to include the following elements:It must:is the product as a whole, not as a whole. It must be made available for purchase, provided that the service or component of the product has any of the above criteria. It must include an electronic component, that is integrated into a manufacturing system (e.g., via the integrated power supply or computer chip.) It must contain the components of the product, that perform the following functions:It must be able to produce the required quality control and service specifications and specifications, and that are consistent with the product’s design, or an integrated system, for those components. It must comply with the product’s features that might not be present in an existing product for
How the supply chain applies in eBusinessThere are many new opportunities presented to a firms supply chain in an E Business environment. Research shows that the most common use of E Business is to improve supply chain processes within the firm and across the supply chain. This activity is referred to as supply chain management. Schneider (2004, p. 544) defines supply chain management as “the process of taking an active role in working with suppliers and other participants in the supply chain to improve products and processes (Schneider, 2004, p. 544).” One example to manage supply chain processes is the development of a distribution strategy for online firms. Organizations need to understand consumers buying behaviors to develop a distribution strategy. This activity requires firms to capture primary data to conduct internal market research. Online retailer, U.S. Cavalry, captures information about its customers via online orders to develop its distribution strategy. Young (2001) states that “research for U.S. Cavalry customers buying patterns showed that a significant number brought from their Website more frequently than their catalog call centers or brick and mortar stores.” Using this internal research proves very beneficial in placing the right products where consumers want to buy them. In fact, Young (2001) also states, “particular product categories may work better in certain channels than in others. Clothing sells better for us online, while boot wear works best in the catalog. So we would tailor our promotions accordingly.”
The use of internal market research does not only facilitate in developing a distribution strategy, but also assists the procurement, logistics, marketing, and inventory departments to order, distribute, promote, and maintain the right products to meet consumer demand.
EBusiness plays a key role in gathering information to allow firms to improve supply chain processes that increases productivity and distribution of the right products to the right place to meet the customers needs.
The benefits of the Supply Chain to eBusinessEBusiness is very beneficial in improving and maintaining product quality and reducing cost. By using Internet technologies across the supply chain a firm can determine the best ways to implement eBusiness strategies by analyzing business processes throughout the entire organization. Schneider (2004, p. 230) illustrates that Internet technologies provide suppliers with the following advantages in an eBusiness environment:
Share information about customer demand fluctuations.Receive rapid notification of product design changes and adjustments.Provide specifications and drawings more efficiently.Increase the speed of processing transactions.Reduce the cost of handling transactions.Reduce errors in entering transaction data.Share information about defect rates and types.For example, as managers review information and payment flows from the consumer to the retailer, from the retailer to the distributor, from the distributor to the manufacturer, and from the manufacturer to the supplier they can develop a supply chain management plan to operate more efficiently and reduce costs. Also the execution of the supply chain management plan can include information to forecast and adjust product flows to increase revenues. These activities will produce many opportunities to improve products more efficiently while reducing costs.