In many ways, EDI standardized formats have simplified supply chain logistics for retailers, and put them in the driver’s seat in their relationships with suppliers. In short, if suppliers don’t comply, they don’t get the benefit of incentives, and may suffer the consequences of penalties. Suppliers who are often out of compliance will also suffer from a lack of repeat business.
Value-Added Networks (VANs) have been around for more than 30 years. But today’s VAN is definitely not your father’s VAN. VANs have evolved from simply being a managed network on which to exchange EDI information and documents between a company and its trading partners to a more robust service that includes not only the network but also a variety of services aimed at facilitating more effective commerce amongst numerous organizations.
Any company involved in supplying products through the retail channel already has two things — communication with their trading partners and a way to manage their finances and inventory. These are typically known by their acronyms, EDI and ERP. But what many of the companies using these systems do not ahve is an integrated connection between them.
The standardized format of EDI documents has been a boon to both retailers and suppliers, providing common grounds for communications and efficiency. Retailers are, in many ways, in the driver’s seat when it comes to EDI – you tell the suppliers what you want and how you want it, and they fall in line.
In today’s technologically advanced world, businesses enjoy great benefits from implementing Enterprise Resource Planning (ERP). ERP solutions offer the ability to manage an entity’s various operations such as finances, supply chain and inventory, for example.
As Supply Chain Management (SCM) grows, so does the electronic commerce interface that is required. After all, you cannot run Supply Chain Control Tower unless all the pieces of the puzzle are present. Let's discuss specifically suppliers.
In a business environment that’s ever-increasingly dependent on and driven by metrics, the perfect order seems like, well, a perfect metric. R. Wang of Constellation Research originally conceived and developed the perfect order as a as a tool for retailers to monitor supplier performance.
Supply chain visibility is of paramount importance to all the players who rely on it, says Ken Jones, director of Executive Education at Western Michigan University’s Center for Integrated Supply Management and an instructor on supply chain matters.
Supply Chain Management's biggest contribution to the corporaton's bottom line is to improve the order to cash process. It is so important that order to cash improvement should be the first line in SCM's mission statement.