Executive Summary

We are living in the age of IT and every fast

growing industry, be it food chain (restaurants or
supermarket), travel and transportation (hotels and
airports, railway, MRT) or retail and goods supply
(warehousing and manufacturing plant) is attributed
to their implementation of IT.
Information Technology (IT) provides a competitive
advantage for supplier to meet customers needs
and expectation on time and in good condition and
at lower cost. The effective use of information
technology (IT) to achieve such goal is therefore
inevitable.
There are certain areas to consider for the effective
use of IT, they are:

Customer service

Customer service is the interface of logistics with
marketing. Although customer service is the output
of the logistics system, customers result when the
company performs well.

Benefits customer service

Customer service has been defined as "a customer-
oriented philosophy which integrates and manages
all elements of the customer interlace within a
predetermined optimum cost-service mix. Customer
service is the output of the logistics system. It
involves getting the right product to the right
customer at the right place, in the right condition
and at the right time, at the lowest total cost
possible, Good customer service supports customer
satisfaction, which is the output of the entire
marketing process.

These services are expected to bring benefit such
as:

a. Improved product and service quality.
b. Improved customer satisfaction.
c. Higher productivity
d. Improve financial performance

Problem of customer service

The problems of customer service are problems
with customer service itself, and not the problems
encountered by customers that cause them to
contact the company. There are actually many
problems of customer service and what may be the
problems for some companies may not be problems
at all for other firms.

The problems of customer service are:
lk
a. Lack of proper training or not much time
allocated for training. When employees are not
thoroughly trained to deal with their daily tasks, they
are more likely to make mistakes that will raise the
ire of customers.

b. Burnt out - When there are too many negative
calls and problems heard every day, even customer
service representatives also grow tired.

Warehousing And Storage management

Warehouse Management System (WMS) is use to
control the movement and storage of materials
within a warehouse. Companies are able now with
the Internet, to implement EDI information programs
with their customers and the JIT delivery program
also helps in the transportation operation


Benefits:

The concept can provide to the company are huge
and very diverse. The main benefits of JIT are :

Reduced set up times in warehouse

The company in this case can focus on other
processes that might need improvement;

Improved flows of goods in/through/out
warehouse

Employees will be able to process goods
faster;

Employees who possess multi-skills are utilized
more efficiently

The company can use workers in situations
when they are needed, when there is a
shortage of workers and a high demand for a
particular product.

Better consistency of scheduling and
consistency of employee work hours

If there is no demand for a product at the time,
workers dont have to be working. This can
save the company money by not having to pay
workers for a job not completed or could have
them focus on other jobs around the
warehouse that would not necessarily be done
on a normal day.

Increased emphasis on supplier relationships

Having a trusting supplier relationship is
important for the company because it is
possible to rely on goods being there when
they are needed.

Supplies continue around the clock keeping
workers productive and businesses focused on
turnover

Employees will work hard to meet the company
goals. Also, the benefits of JIT include: better
quality products, higher productivity and lower
production costs.

Problems:

There are several problems which are connected
within JIT concept. Maybe the major problem with
JIT operation is that it leaves the supplier and
downstream consumers open to supply shocks.
With shipments coming in sometimes several times
per day, the company is especially susceptible to
an interruption in the flow. For that reason, some
companies are careful to use two or more suppliers
for most of theirs assemblies. The hidden costs are
present and they include labor union leverage,
problems with flexible manufacturing systems
(FMS), problem developing for the flexible
workforce, difficulties with supplying.

Inventory planning

Managing appropriate inventory levels to serve
demand in the supply chain. The Internet has reduced
substantially the cost and time needed in the
management of inventory. Ordering process, order
placement and status is faster and errors rate involved
is reduced. Inventory checks through report help to
track stock inventory levels and reduce overall holding
costs.

Raw material inventory management function is
essentially dealing with two major functions. First
function deals with inventory planning and the second
being inventory tracking. As inventory planners, their
main job consists in analyzing demand and deciding
when to order and how much to order new
inventories. Traditional inventory management
approach consists of three models namely:

1 EOQ:
Economic Order Quantity method determines the
optimal order quantity that will minimize the total
inventory cost. EOQ is a basic model and further
models developed based on this model include
production Quantity Model and Quantity Discount
Model.

2. Continuous Order Model:

Works on fixed order quantity basis where a trigger for
fixed quantity replenishment is released whenever the
inventory level reaches predetermined safety level and
triggers re ordering.

3. Periodic System Model:

This model works on the basis of placing order after a
fixed period of time.

This model pre supposes certain assumptions as
under:
No safety Stocks available in inventory.
No Shortages allowed in order delivery.
Demand is at uniform rate and does not fluctuate
Lead Time for order delivery is constant
One order = One delivery no shortages allowed.
This model does not take into account other costs of
inventory such as stock out cost, acquisition cost
etc to calculate EOQ.

This model is also used to determine the order size
and the production lot for an item to be produced at
one stage of production and stored as work in
progress inventory to be supplied to the next state
of production or to the customer.

Transportation management

Transportation is the second highest cost
component on the supply chain. The IT system has
help transport manager to track and ensure that
they are using the right carrier who delivers the
goods on time.

Transportation management is a subset of supply
chain management concerning transportation
operations and may be part of an enterprise
resource planning system.
Transportation management usually "sits" between
an ERP or legacy order processing and
warehouse/distribution module. A typical scenario
would include both inbound (procurement) and
outbound (shipping) orders to be evaluated by the
transportation management Planning Module
offering the user various suggested routing
solutions. These solutions are evaluated by the
user for reasonableness and are passed along to
the transportation provider analysis module to
select the best mode and least cost provider. Once
the best provider is selected, the solution typically
generates electronic load tendering and track/trace
to execute the optimized shipment with the selected
carrier, and later to support freight audit and
payment (settlement process). Links back to ERP
systems (after orders turned into optimal
shipments), and sometimes secondarily to WMS
programs also linked to ERP are also common.
Carrier procurement - arranging multi-modal,
domestic and international transportation,
including rate and service negotiation and
contract management.
Shipment planning and execution - managing the
shipment process, including order
consolidation, route and carrier selection, and
shipment tracking.
Mode optimization- determining the most cost
effective mode of transportation based on historical
data and/or real-time data, given volume, tariffs,
and delivery constraints.

Benefit

Increased efficiency across all modes of
transportation
Improved visibility into logistics network
Enhanced control over logistics operations
Optimized use of transportation assets and
providers

Case study

One of the enabling factors of effective supply-chain
management is the effective use of information
technology (IT). Highlights a number of IT trends
which can be grouped together as four key themes.
These four key themes affect the way in which
technology is used to support logistics operations in
order to deliver competitive advantage. Shows how
some of these themes have been developed and
utilized to provide an in-cab computing system
which delivers competitive advantage to Exel
Logistics. Concludes by showing how the four
themes will support future trends in logistics.

Would you recommend the use of IT in you work
area?

I will recommend the IT in my working area
because it is a technique for improve productivity .a
process aimed at increasing value-added and
eliminating waste, improving the work area and
simplifying process and with the benefits of reduced
operating costs, greater performance and through
put, higher quality, increased flexibility and
innovativeness.


Conclusion:
World is shrinking day by day with advancement of
technology. Customers' expectations are also
increasing and companies are prone to more and
more uncertain environment. Companies will find
that their conventional supply chain integration will
have to be expanded beyond their peripheries. The
strategic and technological innovations in supply
chain will impact on how organizations buy and sell
in the future. However clear vision, strong planning
and technical insight into the Internet's capabilities
would be necessary to ensure that companies
maximize the Internet's potential for better supply
chain management and ultimately improved
competitiveness. Internet technology, World Wide
Web, electronic commerce etc. will change the way
a company is required to do business. These
companies must realize that they must harness the
power of technology to collaborate with their
business partners. That means using a new breed
of SCM application, the Internet and other
networking links to observe past performance and
historical trends to determine how much product
should be made as well as the best and cost
effective method for warehousing it or shipping it to
retailer.




REFERENCES

http://www.managementstudyguide.com

http://www.indianmba.com/Faculty_Column/FC461/f
c461.html

http://www.emeraldinsight.com/case_studies.htm/ca
se_studies

Book : Strategic logistic management