In today’s rapidly-growing business environment, the effectiveness and efficiency of supply chain operations are crucial components in determining an organisation’s success. Equipping yourself with the proper resources allows you to navigate this challenging environment and stay one step ahead of the competition.
In this blog, we will explore 15 indispensable supply chain management tools you need to know. From innovative software solutions to cutting-edge technologies, these tools are designed to streamline operations, enhance visibility, optimise inventory management, and ultimately drive profitability.
To excel in this field, you can opt for the Post Graduate Certificate Programme in Supply Chain Operations & Analytics (SCOA) IIM Nagpur provides a comprehensive understanding of supply chain management and analytics. Led by experienced industry practitioners and renowned academicians, the SCOA programme equips participants with the latest tools and techniques utilised in supply chain management.
Embark on this transformative educational journey and position yourself as a skilled professional capable of driving innovation and delivering optimal supply chain performance.
Understanding the Supply Chain
The network of businesses, resources, tasks, and procedures involved in the manufacture, acquisition, transformation, and distribution of products or services to clients is referred to as the supply chain. It includes the full path taken by goods or services, from conception through consumption.
Various entities, such as suppliers, manufacturers, distributors, retailers, and end customers, comprise a typical supply chain. To maintain the efficient movement of supplies, information, and funds along the supply chain, these organisations cooperate and coordinate their efforts.
Categories of Supply Chain Management Tools
Supply chain management tools streamline inventory management, enhance customer service, and optimise operations. Originally designed for manufacturing firms, these tools have expanded to other industries, enabling businesses to reduce costs and boost efficiency.
They work with ERP and CRM software, offering comprehensive insights into business operations and customer behaviour. These tools fall into two categories:
1. Operational Supply Chain Management Tools
Operational Supply Chain Management Tools encompass various functions within an organisation, such as Order Management, Product Sourcing & Procurement, Transportation Management, Inventory Management, and Demand Forecasting & Replenishment. These tools facilitate day-to-day operations and ensure smooth processes.
2. Strategic Supply Chain Management Tools
Strategic planning and analysis are the main focus of strategic supply chain management tools. They include simulation software solutions, integrated planning systems, advanced planning systems, business intelligence (BI) tools, and optimisation software. These resources support the optimisation of the entire supply chain strategy and long-term decision-making.
Unveiling 15 Essential Supply Chain Management Tools that You Should Know
Although there are many supply chain management tools available, the following are 15 crucial ones that are frequently used in the industry.
1. Warehouse Management Systems
Warehouse management systems (WMS) play a crucial role in monitoring product movement, inventory levels, and overall warehouse operations. From receiving and storing to shipping and picking, WMS tracks and provides valuable data that enables companies to optimise their supply chains while minimising costs.
2. Request For Proposal Software (RFP)
An RFP (Request for Proposal) is a request sent to vendors or suppliers to submit proposals for goods or services needed by a company. It can be issued formally or informally based on budget and requirements. The entire process is automated online thanks to cloud-based RFP systems like BidSync, which eliminate the need for manual interaction from within the company (except for IT staff who are familiar with the system).
3. Order Control
The buy-order process for goods and services is streamlined and automated by order management software. By allowing businesses to quickly submit orders, it facilitates the streamlining of operations. Users may quickly check the status of each purchase and get the information they need as it is backed by real-time tracking facilities along with historical data access.
4. Alerts & Updates on Shipping Status
With this system, you can effectively manage your supply chain and guarantee on-time shipment delivery. To assist you in streamlining operations, it gives important shipment information. Benefits include receiving alerts for delayed or damaged shipments, enabling prompt action and ensuring customer satisfaction. Shipping Status Alerts and Updates are essential for companies prioritising on-time and intact deliveries.
5. Inventory Management
A key component of supply chain management is inventory management, which guarantees effective operations and avoids stock-outs. It includes monitoring replenishment, optimising stock control, and monitoring inventory levels. Organisations can shorten these procedures and more effectively monitor their inventory levels by utilising inventory management software.
6. TMSs, or Transport Management Systems
Companies can monitor and manage their shipments across a variety of carriers, including freight forwarders, railroads, airlines, and trucking firms, through transportation management systems (TMS).
A TMS minimises the need for human coordination between several carriers or providers by combining various transportation modes onto a single platform. Companies can streamline their transportation operations using this method, which also helps them avoid the difficulties of handling each stage separately.
7. Product Purchasing and Sourcing
The process of finding and assessing possible vendors or suppliers for a certain good or service is known as product sourcing. Prior to signing contracts with the selected supplier, it entails negotiating several issues, including pricing, delivery details, quality requirements, and other terms and conditions.
In supply chain management, wise product procurement is essential since it directly impacts the business’s financial health. Making informed decisions during this process is essential to minimise risks and ensure favourable outcomes for the organisation.
8. Demand Forecasting and Replenishment
Demand forecasting is a crucial practice that involves predicting future demand for products or services based on historical data. By leveraging this data, companies can effectively plan and avoid scenarios of product shortages or excessive inventory.
Through demand forecasting, organisations can determine the required quantity of products for specific timeframes, such as monthly or quarterly, allowing them to restock their inventory when necessary and maintain optimal stock levels.
9. Shipping Management
Shipping management tools are indispensable for large organisations seeking to optimise and automate their shipping operations. These tools simplify the tracking of shipments and facilitate efficient management of delivery schedules. Moreover, they enable users to generate and print labels for different products, significantly reducing manual efforts throughout the shipping process.
10. Supply Chain Visibility
Supply chain visibility entails having real-time access to critical information regarding the location of goods within a supply chain network. This visibility encompasses understanding the origin and destination of goods, as well as detecting and addressing any unforeseen disruptions or delays that may occur along the way.
By attaining supply chain visibility, organisations gain valuable insights into the speed and efficiency at which goods traverse their network, allowing them to make informed decisions and optimise their supply chain operations.
11. Order Fulfilment
Order fulfilment is the entire process, from order entry through final client delivery of the goods. Large businesses automate and streamline this process with order fulfilment systems. Users of these systems can automate a variety of processes, such as order processing, inventory management, and delivery.
Businesses may improve operational efficiency and overall consumer satisfaction by utilising order fulfilment systems. These assets are required to provide accurate and effective order fulfilment, which boosts client satisfaction and loyalty.
12. Bid & Spend
A web-based tool called “bid and spend” is available for businesses to help with procurement procedures. Using this technology, users can create an online marketplace where contractors can post job-related bids.
Consumers can evaluate the bids based on criteria like price and quality to make the best decision. Bid and spend tools allow users to analyse spending levels and examine budgets over time, in addition to being tools for supply chain management.
13. A B2B eCommerce
B2B eCommerce enables companies to sell products directly to other companies, circumventing consumer intermediaries. It typically involves online marketplaces but can also include direct sales through phone or email. Manufacturers often utilise B2B eCommerce to swiftly move excess inventory without resorting to discounted retail channels like Walmart or Target.
14. Specialised Freight Handling
Freight management is a vital aspect of the supply chain, encompassing various tasks such as warehouse space management and ensuring timely product deliveries. It plays a pivotal role in the success of a business, as efficient freight management can contribute to the smooth flow of goods and overall operational effectiveness.
Conversely, ineffective freight management can lead to delays, disruptions, and potential negative impacts on customer satisfaction and business outcomes. Therefore, prioritising effective freight management is crucial for the overall success of a business within the supply chain.
15. Lean Inventory
An effective and economical method of managing inventory is lean inventory. Instead of hoarding goods or resources, it entails buying only what is required when it is required. Businesses can reduce the difficulties of selling overstock items at a loss by eliminating excess inventory. By ensuring that products are ordered to fill specific requests, lean inventory minimises waste and enhances inventory control in general.
For procedures to be streamlined, processes to be more effective, and supply chains to be managed, supply chain management tools are crucial. Having a solid understanding of how to use these tools could be highly beneficial for businesses across all industries.
For students aspiring to specialise in this field, the IIM Nagpur Post Graduate Certificate Programme in Supply Chain Operations & Analytics (SCOA) presents an excellent opportunity to acquire comprehensive knowledge and skills in supply chain management. By enrolling in this programme through Jaro Education, professionals can gain a competitive edge and open doors to rewarding career opportunities in the dynamic world of supply chain management.