Information System In Supply Chain Management Research (Essay Sample)

Name
Professor
Course
Date
Information System in Supply Chain
Subramanian, G.H and Iyigungor, A.C. Information Systems in Supply Chain Management: A Comparative Case Study of Three Organizations. Int J. Business Information Systems Vol 1 No.4 (2006): pp 370-386.
Introduction.
Girish H. Subramanian is an Assosiate professor of Information Systems at the school of Business Administration at Penn State Harrisburg. His research passions are in software engineering, global software development and enterprise information systems. His past research publications have appeared in Communication of the ACM, Decision Sciences, Journal of Management Information Systems, IEEE Transactions on Software Engineering, Journal of Computer Information Systems among other journals. His co-author, Adullah C. Iyigungor earned his Master of Science in Information Systems from the School of Business at Penn State Harrisburg (Subramanian & Iyigungor 370). The article elaborates on the utilization of Information Technology (IT) services to improve the supply chain in Wal-Mart, Amazon and United Parcel Services (UPS). Both authors try to depict the importance of IT in the Supply Chain Management processes in the three companies by outlining the diverse advantages of IT services in improving supply chain procedures.
Research Methodology.
The article employs qualitative research because it uses definitions, descriptions and meanings of terms in order to convey the importance of IT in the supply chain process in the three companies. The article defines and explains the crucial importance of IT in the supply chain process and how companies have expanded their supply chains to external entities like vendors and customers. Information and data are collected from different individuals and sources in order to clarify on vital importance of the role supply chain structure have in Wal-Mart, Amazon and UPS. In dept analysis of the supply chain framework by other researchers shows that there are three other strategic dimensions related to the physical structure of any organizational supply chain. Girish and Iyigungor assert that information technology capabilities enable companies to embrace diverse technologies such as Point of Sale in order to understand consumer demand in the market space (Subramanian & Iyigungor 373).
Organizational Strategy at Wal-Mart.
The importance of IT in the article is clearly depicted by the quick response by suppliers to Wal-Mart stores and distribution stores through the communication of satellite signals. The author noted that Wal-Mart had heavily invested in the new Information System (IS) which facilitated communication between Wal-Mart stores and its suppliers in real time. The quick response initiative was facilitated by the innovation of the VSAT network which boosted a lot of Wal-Mart`s business related strategies (Subramanian & Iyigungor 373).
Niche Strategy.
The authors note that the main aim of Wal-Mart was to cease a partnership deal with Procter and Gamble (P&G) in order to maximize their profit margins and improve efficiency in supply chain processes. The partnership of the two companies reduced operational costs and facilitated the growth of sales due to fast transportation of inventory to all Wal-Mart stores across the United States.
IT Systems used at Wal-Mart and their Usefulness.
According to the data collected by the authors, it is clear that real time communication between Wal-Mart and P&G initiated the growth of both companies. This is because Wal-Mart gained a competitive advantage against its competitors since all its sales and inventory processes were handled by their suppliers. This reduced operational costs that would have been incurred by the company. The use of identification technology by both Wal-Mart and suppliers reduced the distribution and inventory expenses because suppliers would promptly replace out of stock items back in the shelves of concerned stores. It is clear that the authors also noted that the data handling system used by Wal-Mart helps the company to have all inventory data at one central virtual location. The suppliers can easily track the sale of inventory through the use of the extranet system which was developed by Wal-Mart (Subramanian & Iyigungor 374).
Business Process Initiatives at Wal-Mart.
The authors noted that for Wal-Mart to experience growth they needed to combine the organization`s EDI networks with the extranet that was built and managed by the company. This helps the company to share data with its suppliers.
IT help Wal-Mart accomplish its organizational strategy.
The authors understood that IT services especially in communication facilitated rapid communication between Wal-Mart and its suppliers across America through satellite signal communication (Subramanian & Iyigungor 375).
Organizational strategy of Amazon.
From the article it is evident that Amazon experienced growth after the successful installation of reliable inventory control management systems. This system reduced the amount of lost inventory and initiated an increase in the number of domestic and international shipments hence the company begun to gain economies of scale. Both authors citing Maloney (2000) noted that the success story of Amazon depended on handling systems used for the distribution of its inventory (Subramanian & Iyigungor 376).
IT Systems used at Amazon and their Usefulness.
The article by both Girish and Iyigungor shows that the supply chain systems used by Amazon are uniquely interconnected from the consumer to the supplier irrespective of the geographical location. The data warehouse supported by Linux helped in handling diverse systems such as customer management and order completion. The company benefitted from the data warehouse because of its large storage capacity of 14 terabyte with a rapid speed of several gigabytes per second ((Subramanian & Iyigungor 377).
Business Process Initiatives at Amazon.
The Six Sigma approach was used in the distribution of orders across the company`s outlets and stores in the USA. The JIT systems were used in manufacturing while Total Quality Management (TQM) methodologies were incorporated in Amazon`s entire processes of operation, distribution and sh...