Technology in scm

Technology in logistics and supply
chain management : A scenario scan
P.P. Sengupta
Fellow, Institute of
Engineers (India),
Former Chief General
Manager (MM) ,Coal
India Ltd.

1

Topics of discussion
 Overview of supply chain
 Technology in SCM’s internal functions
 Technology in supply chain integration,
visibility and collaboration
 Technology in transportation and logistics
 Technology in Warehousing , material
handling and shipping
 Technology of future for SCM and logistics

2

What is a supply chain ?

The activity
that manages
the flow of
information,
money, and
material across
.
the extended
enterprise,
from supplier
through the
functional silos
of the firm to
customer
3

The Supply Chain
 Supply chain is the series of players and activities that
take part in the movement of materials, goods,
services, money and information from suppliers
supplier to the customers customer.
 “Chain” is a simplification of the complex web of
suppliers, sub-assemblers, manufacturers,
warehouse operators, distributors, retailers ,
logistics providers, bankers, insurance companies,
freight forwarders, transporters etc who are the
primary actors in managing the physical flows “from
womb to tomb.”

4

What is logistics ?

Logistics is that part of the
supply chain process that
plans, implements, and
controls the efficient,
effective flow and
storage of goods and
related information from
the point of origin to the
point of use in order to
meet customers'
requirements

5

Technology in SCM’s internal
functions

 ERP
 e-procurement and e-tendering
 Reverse auction
 Collaborative Planning Forecasting and
Replenishment (CPRF)
 Vendor Managed Inventory (VMI)

6

Collaborative Planning Forecasting and
Replenishment (CPRF)

 CPFR is a business practice that combines the intelligence of
multiple trading partners in the planning and fulfillment of
customer demand.
 The consumer is the ultimate focus of all efforts
 Buyers” (retailers) and “sellers” (manufacturers) collaborate at
every level
 Joint forecasting and order planning reduces surprises in the
supply chain
 The timing and quantity of physical flows is synchronized across
all parties
 Promotions no longer serve as disturbances in the supply chain
 Exception management is systemized

7

Vendor Managed Inventory
 Vendor Managed Inventory simply means the vendor
(the Manufacturer) manages the inventory of the
distributor. The manufacturer receives electronic
messages, usually via EDI, from the distributor. These
messages tell the manufacturer various bits of
information such as what the distributor has sold and
what they have currently in inventory. The
manufacturer reviews this information and decides
when it is appropriate to generate a Purchase Order.

8

Vendor Managed Inventory
 Under a Vendor Managed Inventory setup, the
Manufacturer would setup the Distributors inventory
plan.
 The Manufacturer would then monitor the Distributors
inventory levels, keeping track of the sales and the
current inventory level.
 Once the Manufacturer believed the Distributors
inventory levels were too low, the Manufacturer would
generate the Purchase Order and deliver the product
to the Distributor. Vendor Managed Inventory gives the
control over the inventory to the Manufacturer.

9

Technology in Supply Chain integration,
visibility and collaboration

 SRM
 EDI
 Software Agents
 Analytics software
 Comprehensive connectivity – from wireless LAN
technologies, cellular networks, 4G
 Voice and GPS communication integrated into rugged
Computers
 Speech recognition
 Digital imaging
 Social Media

10

Supplier relationship management
 Supplier Relationship Management (SRM) is the
discipline of working collaboratively with suppliers in
order to maximise the value derived from those
supplier relationships.
 Primarily, SRM tools have been developed to reduce
the total cost of ownership (TCO) for procured goods,
while creating competitive advantage for an
organisation through deeper relationships with its
suppliers.

11

Electronic Data Interchange
 EDI is the computer to computer exchange,
between two companies, of standard business
documents in electronic format.
 There are two key elements in basic EDI. First,
electronic documents replace paper based
ones.
 Second, the exchange of documents takes
place in a standardised format. (EDIFACT /
XML)

12

Software agents
 Software agent is a self-contained program capable of
controlling its own decision making and acting, based
on its perception of its environment, in pursuit of one or
more objectives.
 “Gopher” agents, which execute straightforward tasks
based on pre-specified rules and assumptions (eg
inform me when the inventory deviates by 10% from
its mean position or tell me when I need to reorder
stock items).

13

Software agents
 “Predictive” agents, which volunteer information or
services to a user, without being explicitly asked,
whenever it is deemed appropriate (eg an agent may
monitor discussion groups on the internet and return
inputs that it believes to be of interest to the user
 A freight agent may inform its user that a transport
firm is offering large discounts on delivery from China

14

Ultrabroadband Communication
(4G)

 Mobile ultra-broadband Internet access, for
example to laptops with USB wireless
modems, to smart phones, and to other mobile
devices.
 Conceivable applications include amended
mobile web access, IP telephony, high-
definition mobile TV, video conferencing and
3D television.

15

Ultrabroadband Communication
(4G)

 The Mobile WiMAX standard and Long term
evolution (LTE) standard
 Based on the Google Android operating
system
 Will be used extensively in handheld devices,
smartphones and tablets.

16

Speech recognition
 Speech recognition for hands-free data entry – is also
undergoing a new wave of innovation and adoption.
Speech recognition reduces the need for users to look
at a computer display.
 Speech synthesis/recognition capability can now be
easily embedded into numerous legacy software
packages, including warehouse management, picking
and putaway, inventory, inspection, quality control and
other applications.

17

Speech recognition

 Terminal emulation (TE)-based speech
recognition technology eliminates the need for
a separate speech server and a proprietary
interface between the speech system and the
application software. TE enables speech
synthesis to reduce the need to look at the
display, and speech recognition to function as
a true input technology,.

18

Digital Imaging
 Transportation and distribution companies are using
digital cameras integrated into the mobile devices or
handhelds so their drivers can capture proof of
delivery, store stamped invoices, and record
conditions that prevent delivery or proof of service.
 Capturing shelf displays and monitoring documentation
by inspectors, collecting evidence for accident reports,
and recording damage and usage conditions for
warranty claims.

20

Digital Imaging Devices

21

Social Networks and SCM

 Many companies already use social
media as a way of interacting with
their customers and keeping abreast
of new trends.
 Real-time integration already allows
companies to coordinate with the
entire logistics network.
 Internal reports can be processed
with dramatic precision, and external
players can communicate any
potential problems before they
happen.
22

Technology in transportation and
logistics

 Voice and GPS communication integrated into
rugged computers
 Vehicle dispatching systems
 Tracking software
 Portable printing
 2D bar codes
 Real Time location Systems (RTLS)

23

Portable printers

 Provides signed delivery receipts, purchase
orders, work orders and inspection reports.
 Using mobile printers and computers together
lets sales, service and delivery personnel give
customers the documentation they desire,
while creating an electronic record that frees
the enterprise from having to process
paperwork.

25

2-D barcodes

 Two-dimensional bar codes have long been a
proven and popular technology for operations
where it is desirable to present a lot of
information in a limited space.
 Intermec’s EX25 auto-focus scan engine is the
first bar code reader that can read linear and
2D bar codes alike from 50 feet away and as
close as six inches.

27

2-D barcode Reader

A 2D (two-dimensional)
barcode is a graphical image
that stores information both
horizontally and vertically.
2D codes can store up to
7,089 characters,
significantly greater storage
than is possible with the 20-
character capacity of a uni
dimensional barcode.
28

Real Time location Systems (RTLS)

 Real Time Locating System (RTLS) technology
automatically tracks the real-time location of moveable
objects, such as equipment, and people in indoor
environments.
 Near field communication (NFC) is a standards-based,
short-range (a few centimeters) wireless connectivity
technology.
 Ultra-wideband (UWB) RTLS is still a niche within the
RTLS field. This is a specialized market requiring
custom transponders and readers.

29


 RTLS improves the quality of the visibility data
critical for management to make informed
decisions.
 Ultrasound Identification is a real-time locating
system (RTLS) or indoor positioning system
(IPS) technology used to automatically
determine and identify the location of objects
with room accuracy.

30


31

Technology in Warehousing , storage
and shipping

 WMS
 Rfid
 Automated Storage and Retrieval (AS/RS)
 Automated Guided Vehicles (AGV)
 Automated Identification (Auto ID) applications

32

Warehouse Management Systems
(WMS)

 Warehouse management systems (WMS) are
best described as the advanced technology
and operating processes that optimize all
warehousing functions. These functions
typically begin with receipts from suppliers
and end with shipments to customers, and
include all inventory movements and
information flows in between.

33

Warehouse Management Systems
(WMS)
 Receiving reports, pick tickets, move tickets,
packing lists, etc., which are typically maintained
as hard copies, can all be maintained electronically
by WMS.
 WMS provides GUIs wherein most of the time the
operator has to just scans the barcodes. Default
navigation of cursor on the screen mimics the
standard business rule.
 Thus WMS eases the operator's task and makes
the data input process fast, increasing the overall
efficiency of the operator.

34

How Wireless WMS Solutions Work

 Wireless warehouse solutions work by linking
warehouse workers to the backend application
server where warehouse activities are being
recorded via a wireless handheld device. The
device tells employees where to go to pick up,
put away, count, or move product

36


 When items are received to be put away, the
staff members scan a bar code on the box. The
bar code when scanned reveals information
about the box’s contents. Items from the box
are scanned and results are compared so
discrepancies are immediate obvious. The
software then directs warehouse staff to put
away items into a suitable location.

37

 The Basic Design of AS/Rs in warehousing A “high-
rise” storage rack which can be up to 120 feet high is
being used in the AS/Rs in order to maximize the
utilization of the warehouse cubic space. Each storage
location has their unique bar-code or chip to storage
the information of the storage location. While the
carriers reach the dock of the warehouse, the goods is
being loaded or unloaded by “battery-powered
driverless vehicles” to or from the conveyer belts. .

38


39

Radio frequency identifiers
 RFID are small electronic devices that consist of a
small chip and an antenna. The chip typically is
capable of carrying 2,000 bytes of data or less.
 The RFID device serves the same purpose as a bar
code or a magnetic strip on the back of a credit card or
ATM card
 It provides a unique identifier for that object. And, just
as a bar code or magnetic strip must be scanned to get
the information, the RFID device must be scanned to
retrieve the identifying information.

40

 RFID device does not need to be positioned
precisely relative to the scanner.
 RFID devices will work within a few feet (up to
20 feet for high-frequency devices) of the
scanner. For example, you could just put all of
your groceries or purchases in a bag, and set
the bag on the scanner. It would be able to
query all of the RFID devices and total your
purchase immediately.

41


The information on tags is
read when they pass by an
RFID reader, and that
movement is captured and
managed by the system.
Thus one can link the
physical world to the digital
world without any human
interaction

42

Automated Storage and Retrieval
(AS/RS)

 Automated retrieval systems are fully
automated robotic systems controlled by
computers that enable all the operations which
are unloading goods from carrier, sorting, put-
away, storage, order-picking, staging and
loading of goods automatically.
 The basic AS/Rs system is normally built up by
four main components which are: Storage rack,
input and output systems,

43

(AS/RS)

44

(AS/RS)

45

Automated Guided Vehicles (AGV)
 An automatic guided vehicle (AGV), also known as a
self guided vehicle, is an unmanned, computer-
controlled mobile transport unit that is powered by a
battery or an electric motor.
 AGVs are programmed to drive to specific points and
perform designated functions. They are becoming
increasingly popular worldwide in applications that call
for repetitive actions over a distance.

46

 Common procedures include load transferring,
pallet loading/unloading and tugging/towing.
Different models, which include forked, tug/tow,
small chassis and large chassis/unit load, have
various load capacities and design
characteristics.
 They come in varying sizes and shapes,
according to their specific uses and load
requirements.

47


48


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50


51

Technology for future SCM

Future SCM s will be :
– Interconnected
– Intelligent
– Instrumented

52

Future SCM : Interconnected
 Agile, on demand network of suppliers, contract
manufacturers, service providers and other (financial
and regulatory) constituents
 Outsourcing non-differentiating functions to share risks
across the global network
 Variable cost structures that fluctuate with market
demand
 Shared decision making with partners at source (local,
regional, global strategies)
 Integrated, networked asset utilization and
management

53

Future SCM : Intelligent

 Network and distribution strategy analysis and
modeling with event simulations
 Scenario-based operational analysis
 Simulation models and analyzers to evaluate
flexibility factors – service levels,
 Costs, time, quality – with inventory
synchronization

54

Future SCM : Instrumented

 Sensor-based solutions to reduce inventory
costs with increased visibility
 Production and distribution process detectors
to monitor and control energy usage and waste
 Physical transportation, distribution and facility
asset management, controlled and monitored

55

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