Supply Chain System and Its Benefits for an Organization

This assignment has been conducted on the topic “Computing and Information Systems” in which discussion will be made regarding the information systems in relation to business professionals. This assignment will focus on the role and impact of the information systems on the business so as to develop knowledge of the different aspects related to information systems. This assignment will discuss the concept of supply chain system and benefits associated with the use of supply chain systems for an organization. It also discusses the different information systems which are being used for supporting the primary and secondary activities of the Michael Porter’s value chain analysis. Advantages and disadvantages associated with the use of the internet have been discussed which affects the quality of life. It also discusses the role of information systems in gaining a sustainable strategic advantage.

Supply chain system can be defined as a computer system or software which is used by an organization for the purpose of reducing the inventory and lowering the costs of assembling and distributing the supply chain. Supply chain system helps the organization in reducing the cost and complexity of the manufacturing process of the organizations. The reason behind the creation of supply chain system is to enhance the quality, minimizing the cost and gaining a competitive advantage over the others in the business environment. Supply chain systems are being used by the large organizations with a motive to vertically integrate the supplier functions and distribution activities for maximizing the production and logistical control (Kondratjev, 2015).There are various benefits associated with the use of supply chain system which enhances the performance of the organization. These benefits of the supply chain system are discussed below:

• Enhanced collaboration: Organization will be capable of tracking the status of the raw material and finished products by tracking the suppliers and distributors. Organizations can track whether the business is in receiving position or sending position. It enhances the relationship between the organization and other parties. For example, SAP is offering different functions including shipping, manufacturing, and procurement. This system helps in communicating in a better manner (Hanks, 2018).
• Cycle Times: Cycle times can be explained as the duration involved in converting the raw material into a finished product, sending the finished products to distributors, converting the product into money and purchasing new raw material for starting another cycle. Supply chain system enhances the cycle times and ensures that production process is not getting affected. For example, Point-of-sale synchronization has been used by Milliken & company for cutting down the time involved in the supply chain. It was done by linking the retail outlets with manufacturing facilities (Hanks, 2018).
• Meeting customer demands in a better manner: Supply chain system enhances the capability of the organization in meeting the expectations of the customers. Supply chain systems help the organization to process the orders of the customers quickly and in a better manner (Misra, et. al., 2010). For example, 7-Eleven has adopted a supply chain system which ensures that varieties of products are being offered throughout the day at the most locations (Kiger, 2016).
• Better response to the conflicts: supply chain system helps in dealing with the issues arising during the production process or distribution process. It helps in taking quick decisions for coping with the issues. For example, Colgate has adopted a system which has helped Colgate in resolving the issues in a better manner (Kiger, 2016).
• Accurate information: inventory and demand data can be shared by the reseller through the electronic data integration. Production level or storage level can be planned in a better manner for meeting the short-term needs of the resellers by accessing the inventory and demand data. For example, the Web-based supply chain management system has been developed by the U.S. Department of Agriculture for the farmers and ranchers so as to establish a medium of communication between distributors and wholesalers. This system has helped in obtaining information needed by them (Hanks, 2018).
• Reduction in cost: collaborating helps every member of the supply chain to attain efficiency in cost. Supply chain system promotes better relationships between the organization and vendors which helps in cutting down the cost by getting discount(Misra, et. al., 2010).For example, Coca-Cola has adopted an effective and successful supply chain which help in marketing the products in a better manner and reducing cost(Kiger, 2016).
• Quality assurance and waste management: supply chain system helps in maintaining the quality of the products produced so as to ensure that those high-quality products are being performed. Quality techniques are applied in the supply chain system which focuses on enhancing the operations. For example, Zara has adopted a system which has helped in saving efforts and maintaining the quality of the products produced or manufactured (Kiger, 2016).
• Mitigating the risk: one of the key roles played by an individual is to manage the risk. Supply chain system helps in the identification of the various risk factors. An organization can use supply chain system for identifying the risk factors which can lead to internal and external failures (Misra, et. al., 2010). For example, Amazon has adopted a system which has helped in establishing an effective distribution chain. This has helped in mitigating the risk (Kiger, 2016).

Michael Porter has developed value chain analysis which can be explained as a strategy tool adopted for the purpose of analysis of the internal activities of the organizations. The goal of this tool is to recognize the activities which are important for the organization and on which activities focus should be kept for gaining competitive advantage. Value chain analysis is a chain of activities of the business which are classified into primary and secondary activities. Primary activities are those which have a direct relationship with the physical creation, sale, maintenance, and support of the product or service. Primary activities include inbound logistics, operations, outbound logistics, marketing and sales, and service. Secondary activities are those activities which provide support to the primary activities of the business. Secondary activities include procurement, human resource management, technological development and infrastructure (Yanfang, 2012).

Information Systems Supporting Primary Business Activities

Information system providing support to primary activities of the business

• Inbound logistics: these activities involve processes which are related to receiving, storage and distribution of the inputs at internal level. Automated warehousing information system or SCM can be used for the inbound logistics activities. For example, Coca-Cola is using SCM system for the purpose of performing the inbound logistics activities in a better manner (Farfan, 2017).
• Operations: these activities include those processes which change the input into output which can be sold to the customers. ERP information system can be used for the operations activities of the business. For example, MacKay & Sposito a civil engineering consulting firm is using ERP system. With the use of this information system, MacKay & Sposito has controlled the costs of the project and utilized the resources in a better manner (Ciecierski, 2013).
• Outbound logistics: these activities include processes which deliver the products or services to the customers. SCM, barcodes and RFID tags can be used as the information system for outbound logistics activities.
• Marketing and Sales: these activities include processes which focus on attracting the customers for purchasing the product or service. CRM can be used as an information system for marketing and sales activities. For example, Dollar Shave Club has used CRM information system for the integration of the in-house CRM, customer support platform and data analytics (Pigato, 2015).
• Service: these activities are related to the maintenance of the value of the products or services offered to the customers once they have purchased the product or service. CRM can also be used for the service activities.

Information system providing support to secondary activities of the business

• Procurement: this activity includes making an arrangement of the resources required for the operations by identifying the vendors and engaging in negotiation for best prices. B2Be-commerce can be used as an information system for procurement information system.
• Human resource management: this activity includes recruitment, hiring, training, motivation, rewards, and retention of the employees so as to develop strong employee base. HR applications and payroll information system can be used for human resource management activities. For example, BambooHR is an HR software system which has been designed for the purpose of small and medium sized organizations (FinancesOnline, 2017).
• Technological development: this activity focuses on management and processing of the information by reducing the cost involved in information technology, staying updated and using technology for creating value. CAD (Computer-aided design) information system can be used for technological development activities. For example, Adaptive Technologies is using CAD information system for performing the operations in a better manner (Bethany, 2017).
• Infrastructure: this activity includes the support system and functions of the organization which permits the organization to manage the daily operations. CAD (Computer-aided design) information system can be adopted for infrastructure activities.

In the words of Berisha-Shaqiri (2015), the internet is considered as a medium which permits the individual to access the world. With the revolution in the environment, there has been a rise in the use of internet in personal and professional life. The Internet has become the key factor which can affect the operations of the personal and professional life. Long-lasting impacts can be seen with the use of the Internet. The Internet has affected the quality of life in positive as well as negative manner. Use of the Internet is dependent on the desires or goals of the individual. The Internet is considered as a two-edged sword which can enhance the quality of life as well as depletes the quality of life (Batini?, 2013).

Ways in which internet has enhanced the quality of life

There are different ways in which internet has contributed to the quality of life. These ways are listed below:

• Creation of communication opportunities: Internet has acted as an effective approach for communicating with a large number of people. The Internet has reduced the cost for the individuals involved in communicating with the people at a fast speed (Sharma, 2016). For example, Skype has been used by individuals for personal and professional purposes so as to communicate with others (Nutcache, 2017).
• Promotes better education system: Internet has contributed towards the unbounded learning process. The Internet can be used by individuals for sharing and creating knowledge. Different websites are offering courses on Internet (Batini?, 2013). For example, Coursera is offering free courses to the individuals (Anderson, 2013).
• An effective approach for conducting market research: every individual need to conduct market research for the purpose of gathering data or information. This information can be easily collected with the use of the Internet with minimum cost and time involved in it (Sharma, 2016). For example, Apple is using internet for conducting market research so as to analyze the needs or expectations of the customers. Online survey “Apple Customer Pulse” has been conducted for meeting the purpose (SurveyPolice, 2015).
• Enhances the shopping experience: there are various organizations that are operating their websites with a motive to enhance the satisfaction level of the customers (Berisha-Shaqiri, 2015). For example, Amazon is operating website as well as a mobile application for offering the products or services to the customers. Customers can compare the prices of the products on different websites and choose the reasonable one (Neosperience Team, 2016).
• Effective for advertisement and promotion: Different organizations are using internet for the purpose of advertising and promoting the brand and products or services offered (Sharma, 2016). For example, Cisco has used social media platforms for the launching of its new product “Aggregated Services Router” by engaging customers in an interactive and fun way (O’Brien, 2016).

Ways in which internet has resulted in decline in the quality of life

There are few disadvantages associated with the use of internet which results in an adverse impact on the quality of life. These ways are stated below:

• Privacy issues: It is quite tough for the users to protect the data over the internet. The privacy issue is one of the biggest challenges faced by the users of the Internet (Young, 2010). For example, credit card details of the consumers of Equifax were exposed which affected the privacy of the consumers (Armerding, 2017).
• Misleading information: There are cases when fake information is being updated on the internet for taking advantage of the people by misleading them. For example, actual product and the product displayed on the website both are different.
• Online theft: online theft is increasing due to which the organizations are suffering financially as well as socially (Young, 2010). For example, eBay has faced a cyber-attack in May 2014 in which names, addresses, dates of birth and encrypted passwords of the users were exposed (Armerding, 2017).
• The negative image of the business: competitors can use internet for spreading false information regarding the individual. The Internet can promote the business in a negative manner. For example, McDonald’s has used a hashtag #McDStories for promoting the farmer stories but this hashtag was used for criticizing the quality of the food products and service problems faced by the customers (SmartPlanet, 2013).
• Loss of human touch: with the increase in the use of the internet, there is a loss of human touch of the individual from the others (Young, 2010). For example, increase in the use of Social media platforms has resulted in a decrease in the human touch.

I disagree with the above-stated statement that there is no sustainable strategic advantage attached with the use of information systems. Different organizations are using information systems for the purpose of reducing the cost involved in the operations of the organization. The information system can contribute towards the attainment of the strategic goals of the organization. The information system has resulted in a rise in the competition level in the industry which has resulted in focusing on gaining a competitive position by the organization in the market. Information systems act as a customer-oriented strategy which helps in focusing on meeting the expectations of the customers in a better manner. The information system has played a crucial role in enhancing the decision-making process of the management. Information system acts as a decision support system, database systems and helps in meeting the objectives of the organization by utilizing the resources optimally (Hemmatfar, et. al., 2010).

There are various advantages attached to the use of information systems to the business. These advantages are discussed below:

• Helps in shifting the cost of conducting business operations: different organizations can use information systems for the purpose of shifting the cost involved in doing business. This will provide a cost benefit to the business and results in an enhancement in profits to the business. Use of information systems also provides a cost benefit to suppliers, distributors, and customers.
• Differentiation: information systems are being used by the organizations for the purpose of developing differentiated featured and gaining a competitive advantage over the competitors. Online live chatting systems can be used for enhancing the satisfaction level gained by the customers. More accurate data or information can be collected with the use of information systems which enhances the customer base of the business (Hemmatfar, et. al., 2010).
• Innovation: information systems can be used by the organizations for the identification and creation of the new products or services or for developing a new market. The information system has helped in building a bridge between the business people and other individuals (Berisha-Shaqiri, 2015).
• Enhances the relationship shared between the customer and suppliers: information systems are being used by the organizations for the purpose of enhancing the relationship between the suppliers and customers. Direct access can be done from the suppliers to production schedules with the use of information system. Building strong relationships help in switching the costs from one product to a competing one (Hemmatfar, et. al., 2010).   
• Better focus on the niche market: using information systems help in enabling a specific market focus and it enhances the process of focusing on the target market. Support is provided to the strategy by using information systems. For example, Hotel Hilton has used information systems for the purpose of providing tailored services and rewarding the profitable customers (Berisha-Shaqiri, 2015).
• Growth opportunities: different substitutes are available in the market which can be used by the customers for fulfilling their expectations. Information systems can be used for the purpose of expanding the domestic as well as international operations (Hemmatfar, et. al., 2010).
• Strategic alliance: information systems can be used by the organizations for the creation and enhancing the relationships shared with the partners (Berisha-Shaqiri, 2015).

Thus, it can be stated that information systems can be used for enhancing the business processes strategically along with the performance of the business. Thus, a business can gain a sustainable strategic advantage with the use of information systems.

Information Systems Supporting Secondary Business Activities

Conclusion

Thus, from the above discussion, it has been summarized that with the change in the business environment, there has been a rise in the use of information systems and internet. Impact of both these aspects can be seen on the performance of the organization and level of effectiveness of the organization. Both these concepts are widely being used by the organizations operating at different levels.

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