How is Basics of Supply Chain Information Systems link | Explanation of the Software use in Supply Chain – challenges | abbreviations | systems
How is Basics of Supply Chain Information Systems link | Explanation of the Software use in Supply Chain
One of the challenges for anyone getting into supply chain management is learning all of the abbreviations. And when it comes to supply chain information systems, there are lots of them. So let’s walk through a quick and simple explanation of the software technologies that you’re likely to see on a supply chain in the organization.
To start with, supply chain information systems are all basically big databases, but they are designed to be used for different functions. The software and data are stored on computers called servers. When these servers are owned by the company, it’s called on-premise hosting. But these days, instead of hosting these systems on their own servers, most companies run them remotely over the Internet. This is called cloud hosting. It’s also called software as a service or SaaS.
Now let’s talk about the most common types of supply chain information systems. When you work with shipping freight, you’ll use a transportation management system. Basically, a TMS is just a big database that helps you keep track of where each shipment is being sent and how it’s getting there.
When that freight shows up at a distribution center, it’ll get entered into a warehouse management system. The WMS will decide where it should be stored. Then, when someone places an order, a warehouse execution system, or WES, will issue instructions and a pick ticket someone to go retrieve it.
You’ll track the workers in a distribution center using a labor management system, and the trailers parked outside are tracked in a yard management system. Now, if you work in purchasing, then you’ll track your suppliers in an SRM, a supplier relationship management system. These are also called procurement management systems. If you work in sales, then you’ll track customers and prospects in a CRM, a customer relationship management system. Companies that provide services contract the work they’re doing in a contract management system, or CMS. and if you work in a factory, then all of the decisions about what to make and when to make it come from a manufacturing resource planning system, or MRP. If that MRP is able to look across multiple factories and integrate customer and supplier information, then it’s called an enterprise resource planning system or ERP. In order to really understand what’s happening in an end-to-end supply chain, you need to link these systems together, and when you do that, you create a supply chain control tower that provides visibility to what’s happening in your supply chain.
Software plays an important role in every supply chain, and understanding these different types of information systems can help you identify gaps and drive real improvements in your supply chain’s performance.