Learn Supply Chain Blog

Logistics. Ready For The Big Move?

Delivering raw materials to the piano manufacturer….moving a piano to another part of the factory to be painted….transporting the piano to be tested…..putting seven pianos on a truck headed for a distribution center 700 miles away.….eight pianos are put on a ship and sent to London …..four pianos are delivered to a music store two blocks from me. That’s logistics.

For a typical company, this function can cost approximately 15% of total revenue. Since logistics covers everything from bringing materials into a firm, moving it through the firm, then shipping the final product to a customer, it’s hard to exactly quantify all the costs involved. One thing is sure. Transportation is not getting any cheaper. Globalization is making transportation necessary; and goods have much longer way to go.

Supply Chain Software: Automate Widget Making

Why does the term “plug-and-play” not refer to automating your supply chain? Running a supply chain is not a centralized process. Although materials feed from one end of the chain to the other…..the functions are different and usually separate.

One part of the supply chain purchases materials, another part will schedule manufacturing. One area arranges customer shipping while another processes returns. Imagine if we could get all these departments together and share information.

What benefits will befall us if we stop faxing orders, writing invoice numbers on scraps of paper and storing quantities & price on a spreadsheet. Enter the world of supply chain software.

ERP Software

There are times when a company makes a decision that will change life as it knew it. One of those times is the installation of Enterprise Planning Resource software.

Successful implementation of ERP software will integrate all departments across a company into in one happy computer system. Accounting, finance, sales and manufacturing will all be able to update the same record.

This, is as opposed to, sales entering an order into their system…..notifying accounting…...who does a credit check…...approves the order….letting the warehouse know to get inventory ready for shipment….who then checks to see if they have enough stock…...which then packs the goods and readies for shipment..…and then checks to see when the next scheduled delivery is.