ERP enables the company to meet its growing needs and constantly deliver higher performance. ERP having integrated Supply Chain management helps a company to improve its overall performance.
Features of SCM
1. In SCM the production plan is designed.
2. It identifies the suppliers and competition based on price.
3. It defines the manufacturing stages which includes the production, testing, packaging and delivery of products.
4. The company can measure quality, outputs, assess worker's productivity and deliver products.
There are two types of SCM applications - planning and execution application. In the planning stage the company designs the products, price, route to get the raw materials and its qualities. In the later stages the delivery of goods and the finances are tracked. The physical availability of material is ensured before starting the process of production.
Benefits of SCM
Improve decision making: It improves visibility of supply chain inventory and the company can plan production. The shop floor scheduling, order preferences and the needed data can be collected for the production planning, and it enables effective and efficient methods for getting a better vision of the market demand.
The features include having the data and equipments for better decision making such as radio frequency identification and mobile technologies which are integrated with the regulatory compliances and the company can easily follow the government regulation by using the integrated software.
Speed: The software helps the company to get better idea of the competitors and helps to stay ahead of its competitors. The integrated system helps the company to look into customer's need and get a better idea of products, buying patterns etc.
Better visibility: It helps in improving global visibility and supply chains can be designed based on customer demands.
Improve production and increase profitability: The integrated software helps the company to follow best practices and prevent wastages. It reduces the cost and connects the manufacturing unit to the best supplier and integrated legacy system.
Key Objects of SCM
Location: It is used to design the stocking points, facilities and sourcing profit place of location, and to determine the paths through which the goods can flow.
Production: The company can decide the path on which the supply can follow the plans and the path through which the goods will reach the customer. The total cost, customer service feature and revenue is decided by production.
Inventory: Inventory is designed to keep a record of raw material and prepared goods. Inventory helps the production management to take goods, parts, subassemblies and buffer it for future production. The various deployment stages of inventory are important because the company will use the material from the inventory during production. Manufacturing companies have to define the place to store material and also the safety levels and order - reorder points.
In SCM the objects including material, raw material and parts are transported from one place to other through air, road or water, and it is also added to the total cost.
Production plan: It includes the product flow, information flow and funds flow.