How Does Ict Impact Upon Supply Chains?

How does ICT impact upon Supply chains?

This essay is about Information and communications technology (ICT). We will look at how has Information and communications technology (ICT) impacted upon supply chains. We will also determine why is it important for us to use information and communication technology (ICT) in supply chains management (SCM) which including Inventory management, warehousing management system; Order management system, Transportation management system.

Firstly, it will be useful to understand what Supply chain is. A supply chain is a network of facilities that procures raw materials, transforms them into intermediate subassemblies and final products and then delivers the products to customers through a distribution system (Billington, 1994). The supply chain (Coyle et al., 2003) is made by 5 steps show as below figure 1.

[pic]

(Figure 1.)

According to Narain (2004, p10), he states that “ ICT infrastructure solution for logistics and supply chain network management in terms of computer hardware, software, and connectivity by means of Electronic Data Interchange (EDI), Bar Code System (BCS), Enterprise Resource Planning (ERP) and Intranet, Extranet and Internet as show bellows figure 2”:

[pic]

(Figure 2)

Compare figure 1 and figure 2 above. On the figure 2 shows how ICT connect each part of 5 steps and by use them can be really save time and money for organisations. In other wards ICT-based approach can improve supply chain efficiencies. According to (Iskanius and Kilpala, 2006, p283) :

“By utilising information and communication technologies (ICT) for supporting supply chain integration, companies are able to control better the logistical flows of material, information and finance”.

The supply chain is based on the information transition. So ICT is very important for supply chain management.

Firstly, information and communication technology has impacted on inventory management. For instance, if the demand is high and...