Impact of Internet on Supply Chain Management
Where Internet has made its impact in every field of business, supply chain management could not be an exception and a number of bog companies like Cisco, Dell, Adaptec, Zara, and Texas Instruments) have used the Internet successfully to lower costs and add value to their businesses.
Internet has benefited Supply Chain Management in a number of ways, some of them being, creation of more sourcing opportunities for raw materials, reduction of safety stock and cost of holding by combining long-term contracts with spot market purchases, simplification of information exchange and business processes within the enterprise and between supply chain partners using emerging standards like Web Services (XML, SOAP, UDDI, and WSDL), improvement of response times through improved Internet relationships and so on.
With the advent of internet, B-to-B exchanges using Internet-based communication systems have gained growth rapidly because of their market growth potential and impact on business structures throughout the world. Adoption of Internet-based communication systems in industrial purchasing is taking a hold in the entire industrial sector ranging from the high-tech, aerospace industry to the agricultural and dairy industries, from industrial giants such as GE to small start-ups.
The core of the benefits of Internet based supply chains is reduced costs due to timely and speedy transactions, inventory reduction, easy access to new markets and suppliers, and efficient management of the whole supply chain process, and so on. The immediate connection between a buyer and a supplier increases cooperation and efficiency between firms. Also, the ubiquity of the Internet allows more companies to operate on a common platform without heavy investment in closed information networks such as EDI.
Subscribe to the comments for this post