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Supply Chain Management is a practice that separates successful companies from less successful ones. The main goal of this article is to offer you a full-scale introduction to this topic.
Supply chain management is among the core tasks for any company that wants to achieve maximal production efficiency. In this regard, the main problem that is encountered by companies that follow traditional methods in supply chain management is the possibility of human error. However good the workforce is, there’s always a risk of missing some important aspect of managing a supply chain system. Considering all these factors, it’s not surprising that more and more computer-based supply chain management systems are arising on the market. They allow automation of many tedious processes in manufacturing that create major concerns for the human workforce. Ultimately, we believe investments in manufacturing software development are key to ensuring customer satisfaction within the relevant field.
Why Is It Necessary to Use Multiple Types of Software for Supply Chains?
If you look at modern supply chains, you’ll find that the majority of the relevant companies on the market are using a very wide range of software. The reason for this choice of supply chain management tools is simple: supply chain management is a complex process that requires you to take multiple vital factors into consideration to predict all types of future demand. Consequently, it’s almost impossible to create an app that covers every activity in the field. For instance, the procurement process is very different from the management of transportation in the outbound supply chain.
What are some types of apps that are vital for this market? You can find out in the next section, which outlines 10 types of software that are essential for the promotion of supply chain management.
Existing Forms of Supply Chain Management Software
There are multiple types of SCM software on the market that you need to actively consider if you want to run a successful operation without supply chain disruptions. As you can see, the tasks that you’re bound to encounter are diverse enough to require investments in both order-processing apps and demand-forecasting tools.
1. Software for managing orders
The first type of Supply Chain Management Software that you’ll need is the one that will help you process all types of orders. Most companies in the manufacturing sector work with a clear set of orders from the customers. They receive a demand for some product and then can make a decision on processing it or abstaining from the processing. In a traditional system, all order processing occurs in a paper-based format. As a result, there’s a threat of not informing the workers about important changes or the orders per se. Modern software offers a solution to this problem in the form of an intuitive order processing tool.
What are the relevant systems capable of? They can record the customer orders in an automatic mode and then proceed to inform the staff of your company about all vital changes within them. Such computer systems minimize the risks of losing orders due to the incorrect management of the documents. More importantly, they also serve as logistics tools by informing all parties about the status of received goods and their position in the relevant transportation systems. Out of all SCM software types, this one is undoubtedly among the most vital for companies that have to work with numerous customers within different industries. The only reason not to consider investments into this type of software includes the situation in which a company is dealing with a small number of big customers, who don’t have a very diverse set of demands.
2. Software designed for inventory management
Inventory management software is yet another tool that is highly vital for all types of supply chain management. How exactly can this type of technology assist the relevant decision-makers? Above all, it allows them to have a clear overview of all products that are present within their inventories. Many people think that supply chain management is solely about the transportation process. However, this view is far from being correct. It’s not uncommon for various businesses to lose track of certain wares in their inventories due to mismanagement. Inventory management frameworks offer a solution by providing the workforce with tracking tools for all key activities regarding certain aspects of the inventory. What’s more, there’s an opportunity to also use a large number of planning tools, which are often a part of the inventory management frameworks.
3. The monitoring of shipments
Shipments play a tremendous role in the modern supply chain management process. What’s especially vital is the knowledge about the arrival of particular goods. Practices like just-in-time manufacturing require a major investment in the timely arrival of tools and raw materials. In this regard, few ways to track shipments were present in the past. One had to go through a quite significant number of calls to receive information on particular orders. Today, RFID systems and other tracking frameworks finally enable the creation of supplier management tools. In practice, this means that modern shipment monitoring can be automated or at least semi-automated.
In the end, why is this so vital for supply chain operations? There’s a simple answer to that question: information. Since, as the famous saying claims, “time is money”, it’s essential for firms to know where their shipments are and how fast they can arrive. An additional benefit of this technology is also present. It goes far beyond knowledge of shipment statuses. The technology in question also enables high-quality time tracking. Using it, modern companies can greatly upgrade the logistics of warehousing items.
4. Warehouse management tools
Warehouse management tools continue the trend established by the inventory management frameworks. In many ways, good warehouse management software already features the core elements of inventory management. However, it’s necessary to note that those systems typically go beyond the functions of the aforementioned software.
While inventory management tools concentrate primarily on the bird’s-eye view of the business inventories, offering information on the movement of large stocks, the warehouse-centric types of supply chain management software focus on the smaller details of managing a warehouse. They offer more details on the movement of particular products, assisting the staff with the everyday management of warehouses. An inventory management system tends to provide information about the presence of particular products. Warehouse management solves logistical issues by providing the relevant details. Hence, those two types of SCM software often work in combination.
5. Procurement framework
Every company needs to spend significant amounts of money on the procurement of various supplies. For example, it’s impossible for a business to function without investments in various everyday tools, many of which are in the ranks of consumables. A copywriting firm, for instance, may need many computers and even printers to pass information. In turn, a car manufacturer can require a lot of instruments such as crowbars and screwdrivers.
What’s the problem with this demand? It requires complex procurement operations, which, regrettably, often encounter major issues with efficiency. Modern procurement software resolves this concern. It makes all operations as transparent as possible, removing the probability of human factors having a major influence on procurement. For example, procurement frameworks can automatically buy the necessary wares based on the scripted scenarios prepared by its core users.
6. Predicting demand
It’s not enough to produce a ware to gain a profit. You also need to sell it. In this light, the selling process is, essentially, a core part of any production framework. What’s the challenge here? It’s quite simple: no one has enough information to predict the market with 100% accuracy. Many products were launched with the full hope that they would sell en masse. For instance, the recent launch of Apple Vision Pro, which is currently encountering a major market failure, is a perfect representation of this truth.
While not entirely, modern technology can at least somewhat help predict demand for particular products. For this reason, demand prediction frameworks are among the core types of supply chain management software these days. These tools are essential for companies to navigate the unpredictable markets. It’s impossible to know how the market would react to this or that product in its entirety, indeed. However, the analysis of past information and the comparison with current indicators offers at least a partial way to overcome this issue. Demand forecasts can’t give 100% accurate predictions, but they’re capable of indicating cases in which particular products won’t be able to sell well and offer good turnaround times.
7. Customer Relationship Management (CRM)
We live in an economy where suppliers have significant decision-making power. This free economy is the reason so many people are rising out of poverty. At the same time, the presented information means that modern companies have to encounter very high standards regarding their operations. In short, they greatly depend on the loyalty of their customers and their goodwill.
Modern CRM software offers a set of tools that help manage this aspect of firm functioning. What do they offer average vendors? These are tools that allow recording all the key information about the customers’ interaction with products and turn it into full-scale insights about the future of the presented interaction. Using those tools, your team can create full-scale marketing messages for the customers, clearly showing them the reason to be loyal to your firm on the market.
8. Quality management frameworks
The quality of the product is among the core aspects defining the loyalty of the customers to your firm. For instance, a major reason why the Windows operating system is losing its position on the market is quite simple: the quality of the updates regarding this OS is falling. Similarly, the downfall of American car manufacturers turned out to be an outcome of significant problems with the quality of their products.
Considering all those factors, it’s not surprising that we’re seeing the rise of quality management software in the current markets. These apps belong to our list describing the types of supply chain management software for one simple reason: one can’t sell their products if they’re not high-quality. What do quality management frameworks ultimately offer to their customers? Their list of features includes tools for tracking customer demands and managing all forms of quality control activities with minimal costs.
9. Analytics software
Business intelligence and analytics software are important for the same reason as vendor management software, which helps predict the demand for certain products. It assists companies with understanding what products are likely to be popular and which ones are of no interest to the average customer. A ware that isn’t sold is unlikely to bring any profit. Business intelligence software allows companies to understand what wares can bring profit and, more importantly, fit the operations workflow towards the current conditions on the market, which can also be decisive in understanding whether a ware should or shouldn’t be sold. Ultimately, we see this type of software as a perfect supplement to the existing systems. For example, you can connect BI tools to your inventory management system to find the best times during which you can sell particular wares to your customers.
10. Security-oriented tools
In the end, one should also actively consider the security tools in modern supply chains. Why is this case? For instance, many companies that work in the manufacturing sector try to keep information about production as confidential as possible. Data on the release of a particular product in the smartphone sector, for example, can have negative implications for its sales. For this reason, we also recommend focusing on encryption tools to protect a complex supply chain against malignant individuals. Larger supply chain management has many potential points in which information can leak, meaning that tools such as virtualization are indispensable in the presented sector.
Trends in Supply Chain Management Development
In the end, we can also highlight several vital trends in modern supply chain management:
Blockchain as a data integrity technology
A common request we hear when people ask for supply management software help goes as follows: what’s the core way to ensure the integrity of worker reports? After all, there may sometimes be a temptation to misrepresent information to, for example, receive bonuses. In our opinion, one of the best frameworks is to use blockchain. This technology is capable of recording information about certain activities and preventing any illegitimate changes to it. This means that the integrity of information is highly likely to rise with the use of this technology, making it a perfect analysis tool for preventing incongruent approaches to managing resources.
AI as an information analysis system
Modern Artificial Intelligence (AI) offers a perfect way to simplify the work of all employees in supply chains. How exactly does this technology achieve its goal? Above all, through the capability to analyze human-produced information and offer coherent and correct responses to it. Modern workers in the supply chain management sectors have to face large amounts of data from different types of supply chain management software. Often, it’s very difficult to make sense of this data and turn it into one coherent story of the production process. AI, however, has enough processing power to analyze every aspect of production and offer full-scale insights about it. Consequently, modern workers can use AI as a strong analytics framework and an advanced planning tool.
Robots as an automation solution
Lastly, the rise of AI enables the creation of robots as an automation solution. Modern AI tools are capable of complex pathfinding and object interaction. Considering this factor, more and more robots are likely to appear in the warehouses, performing some of the most tedious tasks for the relevant workers. Why is this vital? This information means that it’ll be possible to transfer the workforce to more advanced tasks such as data analysis in the future.
In Summary
All in all, the presented information clearly shows that there’s a large number of solutions in the Supply Chain Management market. Not all firms need to install all of these solutions. Nonetheless, we’re convinced that at least several of them are essential if you want to function well on the market.
If the answer is positive, you can address our company regarding it.
