Major functions of IT in Supply chain Management

Oct 19 • General • 2626 Views • No Comments on Major functions of IT in Supply chain Management

Information technology has always been a supporting functional unit in various business operations. There are many functions that are being performed by information technology in supply chain management. Some of the functionalities performed are as follows :

  • In the processing of basic transactions of the business – IT has always been a support system in execution of the transactions through the method of supply chain execution system. Different business processes which include data processing, inventory management, procurement, transport management, warehouse functions are all mapped through the use of IT.
    IT Supply Chain Management

    IT Outsourcing and Chain Management

  • Increasing the collaboration and coordination in the supply chain– The collaboration and coordination in the chain is maintained through supply chain collaboration systems. This system mainly focuses on establishing a relationship and coordinating with the partners and the customers through the use of internet in its operations.
  • In taking decision related to business operations-  The decision support system which is the outcome of IT can be used in better decision making with the help of supply chain planning systems. It helps the company to take decisions related to supply chain and making the use of different techniques of optimization.
  • Evaluating and reporting the performance of the supply chain – This is an important task that needs to be performed by the companies is to measure the performance and working of their supply chain. The companies use business intelligence an application of IT which consists of different layers of analysis tools, data warehouses and platforms to measure and report the performance of the supply chain.

Information Technology Implementation Methods

There are different methods used by the business managers to implement the use of IT in their business processes. These methods are given as follows :

  • Parallel approach method – In this method the existing system which did not use IT and the new system which have IT works simultaneously until the managers feel and get confidence the the new system would function as desired.
  • Big Bang Approach- In this method the old system is eliminated completely and the new system takes its place.
  • Phased Approach – In this method the modules of the new system are introduced step by step into the functioning of the firm ad this can be done by using any of the above two methods.
  • Pilot Approach – In this method when the new system is created ,it is fully implemented in the operations on pilot basis in a single segment of the organization.

 Importance of Outsourcing
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