The Importance of Information Systems and Technologies (ITS) in the Supply Chain

The Importance of Information Systems and Technologies (ITS) in the Supply Chain

Sofia Sousa
DOI: 10.4018/978-1-7998-4201-9.ch008
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Abstract

Fast and accurate information is essential so that managers can analyze and structure their decisions, ensuring the good performance of logistics processes. Thus, in a constantly evolving world, it is increasingly important for the organization to keep up with consumer needs, adapting and investing in information systems and technologies (ITS) that appear on the market. Within the supply chain, warehouses and their management are often seen only as an inevitable cost for the organization, ending up being left aside when it comes to high investment implementations and changes. However, currently they have proven to be a relevant component that, if well managed and with the appropriate technology, can eliminate costs for the organization while also providing profits, allowing to maintain a perfect balance between demand and supply.
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Evolution Of Is In The Supply Chain

Schultheis and Sumner (1998) identify the increasing need for managers to resort to the use of information systems to support value-generating activities in the supply chain, both at the level of support activities and at the level of primary activities, namely:

  • Support activities:

    • Organization in general – Using office automation solutions;

    • Human Resources – Through competence databases;

    • Technology – Through the use of computer-aided design and production;

    • Purchasing – Through online connections with Suppliers.

  • Primary activities:

    • Inbound Logistics – Through warehouse automation systems;

    • Operations – Through the control of production control processes and systems;

    • Outbound Logistics – Monitoring online orders with incoming systems;

    • Service – Through remote diagnostics.

Logistics should contribute to cost reduction and margin creation, especially through the primary activities of inbound logistics, outbound logistics operations and, in relation to secondary activities, through procurement activity (Ivanov & Sokolov, 2010). The use of ITS logistics has been, more and more frequently, derived from the need to obtain greater competitive advantage, possible to obtain through the increase of efficiency, the reduction of operational costs and the greater capacity of response in systems transactions, these being just some of the advantages of using IS (Carvalho, 2017) (O’Byrne, 2017). Table 1 presents a summary of the evolution of the models, systems and information technologies used in Supply Chain.

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