P1: IML/FFX P2: IML/FFX QC: IML/FFX T1: IML
SupplyChainMgmt WL040/Bidgolio-Vol I WL040-Sample.cls August 13, 2003 17:21 Char Count= 0
372 SUPPLYCHAINMANAGEMENTthe interests of individuals. Another personalization tool
is “clickstream” analysis.Self-Service
Web-based package tracking provided by United Parcel
Service and FedEx is an example of the Internet providing
better service to customers at a lower cost per transaction
to the seller. Other online applications read e-mail from
customers to sort or even respond to e-mail, providing
more timely feedback to customers.Disintermediation
The current state of information technology also expands
the options available for distributing products. Manufac-
turers that were once reliant on wholesalers, distributors,
and retailers can more effectively market directly to end
customers. The success of Dell’s direct model, which lever-
ages Internet technologies, has encouraged other firms to
pursue direct selling. Nonetheless, although one can elim-
inate a link in a supply chain, the functions that link per-
forms cannot be eliminated.SUMMARY
At the core of SCM is the optimal coordination of activities
at and between individual supply chain members. We have
outlined how supply chain members individually and col-
lectively must support and enhance the characteristics of
the products serviced by the chain. Friction between prod-
uct type and the type of supply network servicing the prod-
uct may be the underlying cause of many supply chain
problems. Given that product and supply chain strategies
are aligned, effective execution of the SC’s strategy is built
on operational foundations including overall network de-
sign, sourcing, logistics, transformation processes, and
distribution channels. These basic activities work in con-
cert to balance requirements of quality or service levels
with economic realities of cost containment. Supply chain
managers invariably rely on information technology to fa-
cilitate more efficient physical flow of their products, and
foster better market mediation throughout the chain.
Coordinating the activities of the links in the supply
chain to act in the best interest of the entire chain is
a major challenge. The information technology required
to streamline transactional processes and enable inte-
grated decision making throughout the supply chain ex-
ists. Therefore, the key to accomplishing coordination is
establishing and maintaining trust between trading part-
ners. SCM seeks to elevate the supply network’s perfor-
mance with technology while enhancing business rela-
tionships between its constituencies. The science of SCM
demonstrates that the supply network’s sum is greater
than sum of its parts, while persuading decentralized
members of the network to act in the best interest of the
network overall is probably more of an art than a science.GLOSSARY
Application service provider (ASP) A remote provider
that hosts software and provides access for a periodic
rental fee.Advanced planning and scheduling (APS) Applica-
tions employed to optimize production schedules or
supply chain activities.
Business-to-business (B2B) Electronic business con-
ducted between two firms.
Business-to-consumer (B2C) Electronic business con-
ducted between a firm and a consumer.
Collaborative planning forecasting and replenish-
ment (CPFR) Efforts to coordinate supply chain
members through point-of-sale data sharing and joint
planning.
Distribution channel Supply chain members involved
in moving end products to consumers.
Electronic customer relationship management
(eCRM) Applications designed to automate demand
satisfaction.
Enterprise Resource Planning (ERP) Information
systems that keep track of transactional data to pro-
vide decision makers with better information.
Newsboy model Inventory model to determine the op-
timal balance between stock-out and inventory holding
costs.
Postponement Delaying product customization until
closer to the point of sale.
Vendor managed inventory A suppliers’ making re-
plenishment decisions based on retailer sales data for
products at retail sites.
Extensible markup language (XML) Language de-
signed to describe data that is key to efficient Web-
based data transfer and manipulation.CROSS REFERENCES
See Application Service Providers (ASPs); Developing
and Maintaining Supply Chain Relationships; Electronic
Procurement; Enterprise Resource Planning (ERP); Inter-
national Supply Chain Management; Supply Chain Man-
agement and the Internet; Supply Chain Management Tech-
nologies.REFERENCES
Chopra, S., & Meindl, P. (2001).Supply chain manage-
ment: Strategy, planning and operation.Upper Saddle
River, NJ: Prentice-Hall.
Collaborative Planning, Forecasting and Replenishment
Committee Web site (n.d.). Retrieved March 10, 2002,
from http://www.cpfr.org/
Erenguc, S. S., Simpson, N. C., & Vakharia, A. J. (1999).
Integrated production/distribution planning in supply
chains: An invited review.European Journal of Opera-
tional Research, 115,219–236.
Fisher, M. L. (1997). What is the right supply chain
for your product?Harvard Business Review, 75,105–
117.
Gallagher, P. (2001). Where’s the trust? Retrieved April 25,
2002, from http: // http://www.e-insite.net / electronicnews /
index.asp?layout = article&articleId = CA186834
Harreld, H. (2001). Supply chain collaboration. Retri-
eved April 25, 2002, from http://staging.infoworld.
com / articles / fe / xml / 01 /12 /24 / 011224fesccollab.xml?
Template = /storypages/ctozonestory.html&Rsc = 2