Supply Chain Management Integrated Consumer Demand Forecasting System

7/29/2019 Supply Chain Management Integrated Consumer Demand Forecasting System

1/4

Indian Business Scenario - Opportunities and Challenges

Archers & Elevators Publishing House www.aeph.in1

Supply Chain Management: Integrated Consumer Demand Forecasting System

*Dr.P.Paramashivaiah**R.Shashidhar

***Dr.Pramod Gonchkar

*Professor & Chairman, Department of Studies & Research in Commerce, TumkurUniversity, Tumkur

**Assistant Professor, Department of Studies & Research in BusinessAdministration, Tumkur University, Tumkur

***Assistant Professor, Govt. R.C College of Commerce, Bangalore

Abstract

Rapid growth of e- commerce in the past years has given rise to number of business processes that leverage the system and speed of the Internet for better

collaboration and participation among business partners.Integration of consumerdemand forecasting process with Enterprise Resource Planning (ERP) of supplier by E commerce Web site leading to streamlining the supply chain. With supplier pointof view, Accuracy level in forecasting the Market Demand will lead to betterproduction planning, improving efficiency in procurement and inventory level .Atthe same time this process would also benefit E -commerce web site in optimizingits inventory cost and reducing delivery time to the End customers thereby causingenhancement in the customer satisfaction.

Joint forecasting------ ERP of supplier-------- MRP of supplier ------- Production------E commerce Website---End consumer

Key Words: ERP (Enterprise Resource Planning), SCM (Supply ChainManagement), Inventory, Forecasting, E-Commerce. Introduction

Supply Chain Management is the process of planning, implementing andcontrolling the operations of the supply chain with the purpose of satisfying thecustomer's requirement as efficiently as possible. Supply Chain spansall movement and storage of raw materials, Work-in-process, inventory andfinished goods from the point of origin to the point of consumption. Since the stakefor the different players is extremely high making it imperative for the partners -including suppliers, manufacturers, distributors and customers behave as if they are part of the same company. This way only they can enhance performancesignificantly across the chain.

This amply defines the scope of supply chain management which has to monitorand control the activities right from customer's customer to supplier'ssupplier. Management of supply chain as such is management of various functionscarried out in a continuous supply chain environment such as demand forecasting,production planning, procuring raw materials for production, manufacturing,managing inventory, processing input to convert into output and finally arrangingsmooth distribution of the finished product to the retailers. The geographic reach of Supply Chain Management is immense. Today, a firm producing readymade men'sshirt procures the raw materials from African countries, gets manufacturingprocess done in Asia and sells the product in different parts of the world.

With great strides being made in the way information is generated, disseminatedand collected through the use of Internet , Emails etc great Supply Chains are


2/4


3/4



Joint forecasting------ ERP of supplier-------- MRP of supplier ------- Production------E commerce Website---End consumer

Joint forecasting system exercise would benefit both parties as it will reduce cost of inventory and transportation in big way. Both supplier and E-Commerce need tointegrate their ERPS for accurate forecasting of sales from E commerce websiteperspective and raw material and finished product inventory with regard supplier.Methodology (Process of Integration)

Step I

Joint forecasting by both businesses partners (Supplier & E commerce Site) andcollaborated sales Order Management- By synchronizing E comm. Site ERP withsupplier ERP, supplier will know exact requirements of particular product duringspecified period of time. This would also help supplier in streamlining theinventory.

Fore cast data exchanged between two ERPS will be integrated with Material

requirement planning at production level. E comm. site can supply ready producton time to customer by reducing delivery time.

Step II

Integration of above process with ERP of suppliers- this is purely technologicalsuggestion which needs more detailed research in to this concept by both supplierand E comm. site.

Step III

Capitalizing supply chain benefits by both supplier and E Commerce Web sites-Both parties to analyze the significant economic benefits from the integrationsystem and pass those benefits each other.

Conclusion

Increases the efficiency of order management system, this integration systemenables the end customer to view the product and order the same immediately theproduct is launched from supplier there by reducing the time required for E-Commerce site to get the information from Supplier. Reducing order-Delivery Cycletime. Integrated demand forecasting system improves customer satisfaction leadingto repeat purchases, and effectiveness in the supply chain management.

Future Research Scope Consumer demand estimation process by both supplier & E- Commerce.

-There could be various methods adopted by both in forecasting their sales,but E- Commerce site need to calculate accurate forecasting to avoid highdelivery time and high ordering time with supplier so both parties need takeup precise system for forecasting consumer demand.

Multiple suppliers ERP integration with E -Commerce Website

- E- Commerce site will have many suppliers for its requirement so they need to integrate their ERP and CRM systems with all the suppliers forinformation flow in & out from the site.

Delivery system- Supplier ---End consumer for Cost efficiency.

- By integration E- Commerce site can send customer info to supplier viaERP and ask them to directly supply the product to end customers. here


4/4



research needs to be on cost benefit sharing and studying supply chainefficiency at supplier end.

References

1) Modeling the supply chain by Jeremy F. Shapiro, Edition 2002

2) Supply chain Architecture by William T.Walker, CFPIM.CIRM.Ed:20053) Project papers, Business Journals and News papers.

4) Simchi-Levi D., Kaminsky P., Simchi-levi E, Designing and Managing the Supply Chain, third edition, McGraw Hill 2007.

5) Supply Chain Management by Drucker, 1998; Tapscott, 1996; Dilts, 1999

Documents

Supply Chain Management Integrated Consumer Demand Forecasting System