Logistics

Asymmetry in information

How do supply chain professionals ensure that the process does not become a slave of automated systems?

Manish Rawat

Just move along around your world and you will feel the urge to know things. Variety and diversity are the economical need that has been captured as products or services. Today we find demand for different variety of commodities escalating which initiates complexities in supply chain. Worldwide, efforts are being made to reduce these complexities through identification of important variables that are required to understand the new supply chains and lean out the same for generating best efficiency.

If formation of a value chain is the initiation of any supply chain strategy, then the first question that comes to forefront is, how to define real VALUE. Any supply chain is a complete integration of various smaller supply chains run at individual levels and each such level has a different owner with his own definition for the actual value. As a universal acceptance, customer dominates the definition of final value. Thus as we move downstream in a supply chain we find every participant catering to the value driven need of the adjacent next participant and this effect moves till the final customer from the original supplier. The biggest task in complex supply chains is to capture the right demand of the customer and analyse the same to reduce error in planning and thus have a regulation over the supply chain for producing best results.

Till now, every single participant of the supply chain concentrated on his own relevant data, individual decisions for the actual demand were made and utilised leading to bullwhip effects. People will thus find scattered clusters of information at different levels of the chain. Efforts are being put in to streamline these information clusters by connecting them together and making the complete information accessible to every participant in the supply chain so that they can use that for further analysis and action for increasing overall value at better efficiency and proficiency. Information technology is the supporting platform for the actions been considered for streamlining the information chain. The answer to the complexity looks simple under the roof of developing technology; however sometimes the system becomes more complex if a process becomes slave to an automated system.

Information as the future currency?

What is the future of information in a supply chain? One school of thought wants information to be streamlined but on the other hand, some consider information as the future currency. If that is true, then every participant in supply chain will try to block this information with him and wait for higher premium reward for the same. If this process initiates, then we will again land up in scattered clusters of information. Unlike the previous situation in this new situation individual participant will know the right link that can generate the maximum reward. The whole supply chain will increase its cost once again and probably we will land up at the stage from which we improved. Thus we have to think about eliminating the chances for information from becoming future currency.

(The author is an assistant manager, logistics and infrastructure development (free trade and warehousing zone). He can be contacted at manish.rawat84@gmail.com)