INFORMATION SYSTEM IN SUPPLY CHAIN MANAGEMENT

Information System in Supply Chain Management

Abstract

Wal-Mart is the world's biggest and most money-making retailer, with $44 billion in 1992 sales and 380,000 employees. Its development from a lone shop in Rogers, Arkansas to nearly 2,000 brilliant, appealing shops in 43 states is famous in American business. Sam Walton was centered to the legend. He constructed his domain on a conviction in supplying worth for the clientele and empowering workers, who are called associates. The Wal-Mart heritage is constructed on getting the most present data about what clients desire, getting the best concepts from workers about how to run the shops well, and distributing some of the earnings with employees. The way Wal-Mart functions has been a form for General Electric's quest to boost pace and productivity. Jack Welch, CEO of General Electric said "Many of our administration groups expended time there discerning the pace, the bias for activity, the utter clientele fixation that drives Wal-Mart."

The use of data expertise has been an absolutely crucial part of Wal-Mart's growth. A ten years before Wal-Mart trailed K-Mart, which could discuss smaller wholesale charges due to its size. Part of Wal-Mart's scheme for catching up was a point-of-sale scheme, a computerized scheme that recognises each piece traded, finds its cost in a computerized database, conceives an unquestionable sales acknowledgement for the clientele, and shops this item-by-item sales data for use in investigating sales and reordering inventory. Aside from management data effectively, productive use of this data assists Wal-Mart bypass overstocking by discovering what merchandise is trading slowly. Wal-Mart's inventory and circulation scheme is a world leader. Over one 5 year time span, Wal-Mart bought into over $600 million in data systems.

Information system in supply chain management

Introduction

One of the major transformations in the rapidly evolving digital economy occurs in the supply chains of both traditional and e-commerce companies. Information technology has enabled channel partners to trade goods, share information, and integrate their processes, thereby reshaping the inter-organizational dynamics and resulting in more efficient channels. Electronic integration of data and the automation of business practices has driven costs down and built sales by better satisfying consumer needs.

This paper describes the development of channel partnership between a manufacturer (Procter and Gamble, or P&G) and a retailer (Wal-Mart). Both major players in their industries, P&G and Wal-Mart found a way to leverage on information technology by sharing data across their mutual supply chains. Because of the information partnership described in this paper, the resulting channel has become more efficient because channel activities become better coordinated. There are reduced needs for inventories with increased sales by focusing on selling what the customers want. All in all, the supply chain between P&G and Wal-Mart has adopted a much better customer focus through the channel partnership. And it is mutually beneficial.

The power of inter-organizational information systems (IOIS) is well know in the literature of information systems research. It has proven to be an effective tool for reducing transaction ...