Page 122 - DMGT523_LOGISTICS_AND_SUPPLY_CHAIN_MANAGEMENT

Unit 6: Information Technology Framework

Decision analysis SCIS emphasis shifts more to effectiveness (identifying profitable versus Notes
unprofitable accounts) rather than efficiency (faster processing or increased transaction volume
while utilizing fewer staff resources). To do so effectively, the SCIS needs to be relatively
unstructured and flexible to allow consideration of a wide range of options.
Newer SCIS applications show great potential in providing competitive advantage: using these
applications enterprises are re-engineering their supply chain procedures to reduce the number
of cycles and sequential activities.

6.1.4 Strategic Planning

As is apparent from the title, the focus is on information that supports the ability of the
organization to develop and refine supply chain strategy. These decisions are less structured
than the other areas, but have a long-term focus.

Example: Strategic planning decisions include restructuring networks, exploiting firm
capabilities and market opportunities, strategic alliances, and major customer service
improvements, etc.
The SCIS strategic planning level information must reflect lower-level data collection and convert
this into a wide range of business planning and decision-making information. This information
can then be used in models that assist in evaluating the probabilities and payoffs of various
strategies. Strategic planning ability to assess customer/product profitability, segment
contribution, or alliance synergies can have a major impact on enterprise profitability and
competitiveness.

Traditionally, information flow was used to improve transaction system efficiency. While this
has offered returns in terms of speed and lower operating costs, expected benefits in terms of
cost reductions are diminishing as competitors develop their competencies. With increasing
competitiveness, the area in SCIS applications that has the maximum potential for providing
major savings is shifting focus on the management control, decision analysis, and strategic
planning components.

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Caselet An Infomediary for Supply Chain

radeMatrix.com is an e-business platform that enhances design, operations, and
evaluation of B2B marketplaces to better meet consumer demands. This electronic
Tmarketplace allows firms to focus efforts on key customers, determine segmental
profitability, and accelerate time-to market. The TradeMatrix concept is to allow firms to
build, launch, and service Internet marketplaces that facilitate ocused customer
relationships. The Internet becomes the central trading system for major manufacturers
and service providers. For example, participating firms can now instantly check the
inventory – and the production capacity – of all their major suppliers at the same time to
determine how quickly orders can be delivered. Such information sharing can substantially
reduce supply chain uncertainty and results in less inventory and shorter, more consistent
performance cycles. The visibility can also assist in new product development by allowing
suppliers, manufacturers, and even customers to design, refine, and source components
prior to initiating production.

A cross-industry trade portal supported by the collaboration of a number of supply chain
product and service providers, TradeMatrix includes the application functionality to support
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