Published on May 5, 2016
1. 1 Re - inventing & Re-modelling Logistics & SCM By Zubin Poonawalla Conceiveddecades ago as the way forward for manufacturers who sought to harness technology to better plan business operations, ERP has been used to patch up disparate systems and processes to provide an integrated information flow to an organization. With technological advances and the explosive growth of companies like Amazon – online to offline, e-commerce, real time delivery, and drones – the logistics and supply chain industry of the new era needs entirely new levels of speed, accuracy, efficiency and cohesion from its ERP systems and other solutions that they use for driving business. The traditional model of patchwork for disparate systems, along with the legacy roots in manufacturing, leaves these logistics and supply chain companies with a software that does not cover their operations comprehensively, creating gaps in vital functions. While a traditional ERP has tried to meet warehousing needs, integrating stacking and racking; companies are now demanding much higher levels of precision, real-time tracking and response systems, to manage the highly dynamic requirements of the modern supply chain business. The nature of modern business, thus, makes it imperative for ERP vendors, and businesses as well, to think of ERP in a totally new context. There needs to be a fundamental shift in the way in which ERP usage is viewed, from a system of records to a system of insights and action. This system must gel with the usage patterns of new
2. 2 generation application users, who are tunedhighly into social media. This system must, at the same time, provide high-level automation of routine functions, enabling all levels of user hierarchy manage by exception and ensuring quality time for users, to focus on strategy and innovations. Logistics and technological advances such as Near-Field Communication (NFC), GPS, QR Codes, RFID tags and sensors have to be utilised and integrated with the ERP applications, in order to automate inventory transactions and maximise warehouse space and inventory. Store transactions getting completed in a jiffy, through a couple of scans of QR Codes have been in the mainstream for some time now. GPS enabled tracking of consignments and the ability to visualize real-time status through Google Maps, has brought tremendous benefits to many businesses, already. By using trend analysis through integrated data analytics, one can efficiently arrange warehouse space, ensuring high-traffic items are placed near loading doors, for quick movement. Additionally, in order to forecast demand and plan inventory effectively, one can leverage multi-agent based technology for real-time scheduling, Route Planning and Load Optimization and Inventory Forecasting. This will in turn increase the processing capacity, drastically, ensuring faster and smarter decisions. Also, Big data analytics using the terra bytes of data made available through Internet of Things is the other huge area both supply chain companies and the ERP vendors must focus together on. Mobility solutions are now key for any organization. Smartphones are no longer news, they are a necessity. The smartphone penetration is increasing by leaps and bounds, globally. In a business context, there
3. 3 is always a need to be connectedto the latest information, in order to make the best decisions. Being able to manage operations via smart devices gives flexibility and places critical information within reach, allowing thorough evaluations during any situation. Overseeing and managing the supply chain by walking around is no longer impossible, it is now mandatory for business success. Any ERP that lets a usercarry out his or her day-to-day work through a mobile device – take customer orders, track statuses of an invoice, authorize a document, apply for leave – is bound to have a legion of fans in an organization. Companies need to gain a competitive edge in today’s market. Ensuring that processes run at optimum levels is not enough. An organization must be able to make accurate, instantaneous changes and decisions. Real-time tracking of warehouse utilisation, supply chain movements and inventory status is now necessary for warehouse workers and top management to make decisions. All this being said, user-friendliness is still key to determining whether an ERP is properly utilised. If the ordinary logistics worker is unwilling or unable to use the ERP, the system will lack necessary critical information. It is just as important to have an intuitive interface that can be used by everyone from upper management to workers, on the warehouse floor. Building on the new need for analytics, ERP software shouldalso be context-aware. As businesses grow and shrink with the market, their internal functions have to adjust, accordingly. Having this foresight can make the difference between a successful or failed implementation.
4. 4 As technology advances, and newer business models appear on the horizon, ERP solutions need to not only catch up and stay in tune with the technology trends, but also be agile enough to mould themselves into the ever evolving business models, to fit the needs of the various industries they serve. No longer can traditional ERP platforms shoehorn otherbusiness segments into legacy systems. ERP must be redesigned so that it can break away from its legacy manufacturing roots and create a platform to deliver and serve the needs of many.