How to improve Response Efficiency of supply chain management?


Keywords: #response efficiency #supply chain #warehouse management system #effective linkage 

Response efficiency determines whether the supply chain can flow smoothly or not. When many people talk about improving the response efficiency of the supply chain, they will immediately think of using information technology to eliminate labor through WMS (Warehouse Management System), TMS (Transportation Management System), OMS (Order Management System) to improve collaboration and achieve the expected goal of speeding up the supply chain and increasing efficiency.


In theory, it is true that software technology and information systems can mostly solve the errors, losses and costs caused by manual management. However, in practical applications, many companies' supply chain management work is still not satisfactory after introducing WMS, TMS, OMS information systems.


Supply chain consists of procurement, manufacturing, logistics transportation and distribution. Each link is divided into many small nodes, which are connected in series by logistics and transportation. However, logistics data information is being isolated from each other and limited to the upper and lower nodes, and cannot link the entire supply chain.


Lacking of effective linkage between suppliers and customers, as well as different operation levels within company, various problems are prone to occur. Then, it results in high time cost and communication cost of feedback when solving supply chain problems. Slow feedback, with difficulty in handling of supply chain problems are the real reasons for the inefficient response.


Therefore, in addition to the application of information technology, the efficiency of supply chain management also decides how to connect the logistics mode of the supply chain.


How to improve response efficiency of the supply chain?


To sum up, the response efficiency of the supply chain can be roughly divided into two parts. The first part is internal operation efficiency of the company, which can be effectively controlled through the information system; the second part is the efficiency of the circulation between the various nodes of the supply chain, which relies on logistics service and information link model to achieve.                              

The efficiency of supply chain response relies on how to connect various nodes.


Creating an efficient and much more transparent integrated platform is the key.


Supply chain management is actually the comprehensive management of product flow, information flow and capital flow. Product flow and information flow must be synchronized so as to improve the service level of the entire supply chain.


At present, the data of each link is relatively independent, and supply chain data can only be coordinated through data integration by hand. In this process, there will be too much data missing and data changes, resulting in the failure of the supply chain operation. There is no way to improve the response efficiency of the supply chain without true data. 


The role of the integrated service platform is to open up data islands in supply chain. Only in an open and transparent supply chain environment, through data and information sharing, can each company in the supply chain intuitively see the supply chain circulation, and when problem arises, they can find the problem and deal with it as soon as possible.


Under the controllable sharing of supply chain information, the logistics value chain can also be reconstructed, making the supply chain circulation more transparent and flexible.


Platform service providers need to build a data platform to connect all the collected data with all companies’ TMS and WMS. Companies could check the material preparation, production, packaging, warehousing, and transportation of products at any time through the platform of the service provider.


All of these require the analysis and management of material data by platform service providers to realize the data connection between customers and suppliers to improve the response efficiency of the entire supply chain. Secondly, companies can also ask platform service providers to provide data analysis services to optimize their supply chain and formulate future development plans through the entire supply chain.

Author: Steven ZHOU