SUPPLY CHAIN MANAGEMENT ON E-COMMERCE CAPABILITIES

Supply Chain Management on E-Commerce Capabilities

Supply Chain Management on E-Commerce Capabilities

Introduction

The internet has revolutionized the ways business is conducted these days. But the degree of reliance of a company over the internet is greatly dependent upon some factors including the nature of business, the industry, the short and long term corporate strategy the company pursues, and the clientele. A survey of companies with established market position and online presence demonstrates stark disparities in the type of results and performance in terms of benefitting from the internet. While Dell has greatly benefitted from the internet and, the technology has resulted in increased revenue and more earnings, Amazon had to face the loss of more than 500 million USD in the year 1999. Companies with the capability to exploit the opportunities offered by the internet in terms of cost reduction and revenue enhancement thereby efficiently integrating e-commerce with existing business operations and channels are the most likely winners in this internet era (Meier & Stormer, 2009).

E-business in a Supply Chain

E-commerce implies conducting the major part of the bossiness over the internet. In terms of supply, companies engaged in executing business transactions over the internet normally undertake some or all of the business activities mentioned below;

Price and contract negotiation

Provision of product and business related information

Placement and receipt of orders

Tracking the real time status of products being shipped

Acknowledging delivery of products

Payment and receipt of bills

All the activities mentioned above have previously been performed using conventional channels such as catalogues, sales person and conventional retail outlets. In today's technological era, however, companies are increasingly taking the advantage of modern technologies such as the internet in variety of ways to improve their overall performance in many aspects of the business including supply chain. For example, Dell employs the internet technology to display all its products and relevant options online so that the potential customers of the company can easily access the product information (Fazlollahi, 2002).

Similarly, other companies like Ford and Solectron are using internet to enhance their organizational productivity by increasing collaboration in the area of product design. Federal Express and UPS are one of the first courier companies who have introduced internet based online shipment tracking system for their customers. All these examples provide ample testimony to the fact that today's advanced and internet based business activities and electronic commerce transactions warrant a new approach to supply chain management, which would take care, among other things, this relatively new phenomenon in modern day business world (Fazlollahi, 2002).

This papers aims at discussing different aspects of supply chain management, while emphasizing upon the requirement of today's e-commerce activities. The paper will also discuss the challenges the new internet based economy and resulting business landscape has brought for those responsible for supply chain management.

Discussion

An efficient supply chain management attempts to ensure producing the right product, at the right place, at the right time, at the right price, and for the right people. One of the most important and primary objective of ...