Question

1. Survey from the Internet, books, journals, and other sources and provide a concrete example in the form of case studies from the industry regarding the application of software or software in the supply chain process. Explain the advantages and disadvantages of using the software.

Answer 1

I will give you an example from my own experience of how software can enhance the supply chain in customer operations.

Let us take the example of an agricultural giant who are the world leaders in Crop Protection (Fertilizers). Let us call them ABC Pvt Ltd

This organization has a 2 tier supply chain, that is,

ABC -> Distributors -> Retailers -> Farmers

What this means is, in the supply chain, ABC first sells goods to the distributors, who then sell to retailers, who finally sell to the farmers.

Now, the major issue faced by ABC is that the distributors are all pen and paper distributors. This means that they don't use any system to conduct their operations. This brings a lot of disadvantages, as this means ABC has no visibility of how much inventory is held at each distributor, how much goods is being sold by each distributor and how much is being liquidated in the market.

To counter this, a Distributor Management System was introduced which is a cloud based ERP system. This DMS system was given to all the distributors which would help them carry out their operations more effectively.

Benefits:

• Simple for the distributors to use, and it is a cloud based software
• Online ordering from the principal - no need to call/fax ABC to send goods
• Easy to manage the entire business - makes it convenient for the distributor to manage his entire business, including financials
• All records are digitized
• Transparency throughout the supply chain
• Helps in easy material planning

Disadvantages:

• Needs infrastructure - laptops and internet. Hence, it might not be a best fit in rural areas/areas with poor connectivity
• There is a cost associated with each license - for how long with ABC bear this cost?
• There is a steep learning curve associated with this software, hence significant change management is involved.
• Automated integrations with the principal's ERP would require heavy investments and customizations.