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Can Integrated Technology Solutions Benefit Supply Chain Management?

October 31, 2013BY AMS Editor

Distributors should leverage technology solutions to meet the increasing demands on supply chain management in today’s fast-moving world.

An article on the Supply Management website highlights the results of a recent survey looking into issues that supply chain managers frequently face. These issues include the need to cut costs while also providing better customer service and supporting expansion initiatives.

More than half of respondents to this year’s survey (68 percent) said it was “very important” to reduce costs, which was a 4 percent increase over last year. Similarly, 47 percent of respondents said company boards expect reduced costs and more efficiency.

This is not really surprising. Expectations by boards that companies run lean are not new. What is on the rise, however, is the need to maintain lower costs while meeting increasing customer expectations in a growing market.

Distributors and retailers are being pressured to meet demands that are more real-time and coming from a larger audience. At the same time, they’re trying to keep resource requirements constant.

The key is to take advantage of newer technologies to increase customer service without increasing the cost of providing that service. That means having efficient processes that use tightly integrated applications for order management. There should not be a string of offline manual processes required to take care of customers.

Customer service must use one application to interface with customers, and service reps should have 360-degree visibility into each customer, allowing insight into all interactions between the customer and the company.

Among other findings in the survey, 55 percent of respondents said they must increase the stock they offer thanks to omni-channel demands. This most likely is indicative of an increase in customer-specified products; for instance, you draw more customers by providing more ways to tailor the products you offer.

About 55 percent of respondents said they are building additional distribution centers, and nearly half “are building direct-to-consumer fulfillment capabilities.” That’s a bit surprising. This appears to lie in contrast to the move toward supply chain virtualization. Perhaps we are seeing a shift toward capital expenditures as the cost of funds has come down.

In the end, this survey highlights some interesting results, but the bottom line is that distributors must look to technology to help them navigate the demands of today’s increasingly fast-paced, global economy.

Source: Supply Management, October 2013

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