SCM system

SCM system
See also
Value chain model Logistics chain Inventory costs Types of logistics costs Material stream Resources and capabilities Landed cost Production logistics subsystem Procurement logistics

SCM systems (Supply Chain Management systems) are IT systems supporting supply chain management operations, and coordinating flows of goods.

This system allows easy analysis of the material flows between suppliers, and gives the company easy possibility to adapt to market demand.

Typically includes support for the transport planning at different levels between the different companies involved.

Functions of SCM IT systems

Supply chain management (SCM) IT systems are computer-based systems that support the planning, coordination, and control of activities involved in the movement of goods and services from suppliers to customers. These systems play a critical role in managing the flow of materials and information across the entire supply chain.

The following are some of the key functions of SCM IT systems:

• Demand forecasting: These systems use historical data and statistical analysis to predict future demand for products and services.
• Inventory management: These systems help to optimize inventory levels by tracking stock levels, reordering points, and lead times.
• Purchase order management: These systems automate the process of creating, tracking, and approving purchase orders, making it more efficient and accurate.
• Transportation management: These systems help plan and coordinate the movement of goods and services, track shipments, and optimize routes and logistics.
• Production planning and scheduling: These systems help to plan and schedule the production of goods and services, taking into account demand forecasts, inventory levels, and production capacities.
• Quality control: These systems help to monitor and ensure the quality of products and services through the use of sensors, cameras and other technologies
• Supply Chain Analytics: These systems help to analyze data from the various aspects of the supply chain to identify trends, issues, and areas for improvement.
• Collaboration & Communication: These systems support collaboration and communication among various supply chain partners, and help to share data, documents and other information in real-time.

In general, SCM IT systems help to improve the efficiency, visibility, and responsiveness of the supply chain, enabling organizations to make better-informed decisions and improve their overall performance.

Types of SCM IT systems

There are two types of IT SCM systems:

• internal engaged in supplying, distribution and production,
• and external, integrating the company with its suppliers.

With this system, the partner companies, can find a niche in the market and to use information across whole logistics network.

In manufacturing companies SCM incorporates the majority of the production process planning and supply activities.

The advantages of this system can include: integrating with other companies IT systems via the Internet, the optimum adaptation of production to market needs, search for market niches, optimization of supply sources and identifying constraints in the supply chain.

See also:

• IT systems in production management
• IT systems in value chain management
• Strategic IT System
• Sources of information in logistics

References

• Fawcett, S. E., Ellram, L. M., & Ogden, J. A. (2014). Supply chain management: from vision to implementation. London: Pearson.