Managing the entire distribution chain, or supply chain, efficiently can be a complex challenge, as there are many processes involved: warehouse management, logistics, supplier relations, procurement, production, purchase order management and distribution. In this context, implementing an enterprise resource planning ( ERP) system can make all the difference, enabling companies to identify critical issues and improve efficiency throughout the supply chain.
Efficient supply chain management enables companies to reduce time to market, increase competitiveness and together increase customer satisfaction.
ERP systems are a valuable resource in Supply Chain Management (SCM) because of their ability to integrate data and processes within a company.
Here are some ways in which an ERP can help improve supply chain efficiency:
Identification of critical issues
The first step in optimizing the supply chain is to identify existing critical issues. These can manifest themselves in a variety of ways, including:
- Excessive or insufficient inventories: Excess inventory can lead to high storage costs and product obsolescence, while insufficient inventory can lead to delivery delays and lost sales.
- Extended delivery times: Delays in delivery time can adversely affect customer satisfaction and compromise the company's reputation.
- Inefficient production processes: Inefficiencies in production processes can cause waste of time, resources and money.
- Logistics management: Problems in logistics management, such as depletion of stock in the warehouse or shipping errors, can compromise the integrity of the supply chain.
