One of the influencing dimensions of e-commerce on supply chain integration-Information Integration

Electronic Information Integration

Information Integration is the basis of supply chain integration. For companies in the entire supply chain, to coordinate their products, finance, and information flows, they must be able to obtain information that reflects their supply chain status correctly and in a timely manner at any time. Therefore, the ability of all supply chain partners to obtain timely information sharing is the key to improving supply chain performance.

To ensure that the supply chain is driven by real consumption demands and information sharing, this is critical at 01:10. This is the most effective way to overcome the distortion of demand information in the supply chain-the well-known "bull's whip effect. When the partner uses local information for Demand Prediction and delivers the prediction results to upstream partners, the partner makes decisions based on local economic factors, local constraints or business measurements; in the perception of uncertainty in the supply environment, gambling exaggerated orders, and Information Distortion often occurs. These distortions gradually expand from one level to another in the supply chain, which is seen as one of the biggest reasons for inefficiency in the supply chain.

Increase order visibility in the supply chain

Figure 1: Information Distortion and scalping Effect

One way to overcome the scalping effect is to make the demand information transparent. In fact, in the food industry, this transparency is considered to be the cornerstone of supply chain integration, the main factor for "effective customer response", and the movement towards the overall supply chain integration in that industry. Companies that participate in information sharing efforts usually share sales data, inventory status, production schedules, promotion plans, demand forecasts, and shipment schedules.

Internet Information Center: Key to information sharing

 

 

 

The Internet is an effective electronic link between different entities and has proved to be an ideal platform for information sharing. The power of the Internet comes from open standards that allow large numbers of visitors to obtain information in a low-cost, simple, universal, and secure manner.

One of the methods for Internet-based supply chain integration is the information center, which can continuously process and transmit all relevant information to all appropriate participants. Multiple organizations in the data network of the information center pursue supply chain integration in mutual influence. The information center provides data storage, information processing, and upload/download functions. The entire network forms a hub-and-spoke system, and the internal information system of the participants is the assistance of the system (such as ERP or other enterprise systems ).

In the Logistics world, similar to the information center, it is a "Pass logistics center". In this process, products that move from multi-supply resources to the logistics center are classified based on the needs of the destination. They are then delivered to the center, where key supply and demand data can be downloaded and seamlessly delivered to appropriate partners as appropriate.

Collaboration = Profit

Is information sharing worthy of such efforts and risk? A recent joint study by Stanford University and Accenture (formerly an Anderson Consulting firm) surveyed 100 manufacturers and 100 retailers in the food and consumer goods industries. The results show that companies with higher profits than the average usually actively participate in higher levels of information sharing.