Page 129 - DMGT523_LOGISTICS_AND_SUPPLY_CHAIN_MANAGEMENT

Logistics and Supply Chain Management

Notes 6.4.2 Communication Systems

The communication module facilitates information flow between functional areas within the
firm and between supply chain partners. The major communication components required for
supply chain operations. Logistics information consists of real time data on company operations
inbound material flows, production status, product inventories, customer shipments, and
incoming orders.
From an external perspective, firms need to make order, shipment, and billing information
available to suppliers, financial institutions, transportation carriers, and customers. Internal
operating units must be able to share and exchange information on production schedule and
status. Typical supply chain communication technologies include bar coding, scanning, Electronic
Data Interchange (EDI), satellite communication, radio frequency, and the Internet.

6.4.3 Execution Systems

Enterprise execution systems work in conjunction with the firm’s ERP to provide specific
functionality to support logistics operations. While some ERP systems include reasonable logistics
functionality, many lack the capabilities to facilitate contemporary warehouse and transportation
operations. Most execution systems are “bolted-on” or integrated into the ERP system to facilitate
data exchange. In addition to facilitating standard warehouse management functionality such as
receiving, storage, shipping, and warehouse automation, Warehouse Management Systems
(WMS) typically include management reporting, support for value-added services, and decision
support capability.

Notes The Transportation Management System (TMS) typically includes routing, load
building, consolidation, and management of reverse logistics activities as well as scheduling
and documentation. Yard Management Systems (YMS) track inventory in vehicles stored
in facility yards.

6.4.4 Planning Systems

While the ERP system processes transactions to execute specific logistics activities, transaction
systems in general don’t evaluate alternative strategies or assist with decision making. Supply
chain planning systems, now being termed Advanced Planning and Scheduling (APS) systems,
are designed to assist in evaluating supply chain alternatives and advise in supply chain decision
making. Sophisticated supply chain planning systems are becoming increasingly common to
allow for consideration of complex alternatives under tight decision time constraints. Typical
supply’ chain planning applications include production scheduling, inventory resource planning
and transportation planning. Using the historical and current data maintained in the data
warehouse, APS software systematically identifies and evaluates alternative courses of action
and recommends a near optimal solution within the constraints imposed. Typical constraints
involve production, facility, transportation, inventory, or raw material limitations.
Planning systems can generally be grouped into two categories, strategic and tactical. Strategic
planning systems are designed to assist in analyses where there is a large number of alternatives
and data outside the range of current history is required. Examples of strategic planning
applications include supply chain network design and structural analyses such as which
combination of supplier, production, and distribution facilities should he used and how product
should flow between existing or potential facilities.

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