Gaining a Competitive Advantage with Logistics
By paul.homchick on Apr 12, 2013
Guest author Jon Chorley, Chief
Sustainability Officer and Vice President SCM Product Strategy at
Oracle shares his perspective on the latest supply chain predictions for
Sometimes the magic happens behind the scenes. This is very much the case in logistics operations as while it is often an area that is out of sight and out of mind, expectations for near-perfect performance are placing increasing stress on global logistics organizations.
At its Supply Chain Executive conference last year, Gartner did a great job of summarizing the trends impacting logistics operations - environmental issues, risk and compliance, international flow optimization and supply chain execution convergence – but this is definitely a big, important and constantly changing topic that requires ongoing consideration.
That is why we wanted to share an Aviation Week story by Robert Trebilcock that includes comments by our own VP of applications development Hannes Sandmeier. The article discusses the changing nature of logistics and supply chain management and how its success increasingly depends on the transparency and exchange of information. Trebilcock lists several reasons why information has become so important including the increasingly just-in-time nature of lean operations, the complicated and fragmented nature of today’s supply chains, and lastly, logistics is now a competitive advantage for those who excel.
“For the companies that can ship faster, plan better and provide more timely information, logistics is an area where they can differentiate themselves,” says Sandmeier.
But what’s the point in discussing how much we need information without listing the various technologies that enable this information. Each of these four categories, enterprise-level systems of record, supply chain execution systems, visibility and event management, and data collection, play a different role. The most common system of record is an enterprise resource planning (ERP) system that allows organizations to efficiently plan what parts and components will be needed and where.
Sandmeier says, “You want to optimize your inventory across all of your locations at the highest possible service level, given your budgetary constraints. If you're only operating three locations, that's not so difficult to do. If you have 200 locations, you need to understand the fleet of parts you are trying to address. Otherwise, there's no way even the best transportation system can move those parts around in a cost-effective manner.”
To meet expectations for near-perfect performance across today’s complex supply chains, visibility is no longer an option, it’s a necessity. In fact, with the right technology in place, it is possible to make real-time, informed decisions that support efficient operations and meet the increasing expectations being placed on global logistics organizations.