E Commerce Improve Customer Relations Service Term Paper

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Total Length: 2559 words ( 9 double-spaced pages)

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Abstract

E-commerce is not only web-based shopping and trading; rather, it incorporates holistic business efficacy at all operational levels. The term ‘supply chain management’ (SCM) is used to denote coordination, scheduling and control of product/service procurement, manufacture, deliveries and inventories. It forms the mainstay of e-commerce. A supply chain is considered efficient if it has the right services/products at the right time and place for reducing costs or saving money and improving cash utilization. Innumerable American firms have started banking on e-commerce for achieving more efficient supply chains.

Introduction

Modern-day competition is of a supply chain-wide nature; it is not limited to individual firms. The term ‘supply chain’ may be defined as a system of distribution alternatives and facilities for whole corporate networks to collaborate for the purpose of designing, producing, delivering, and servicing products. Ever since the concept was introduced, SCM has been growing in significance for corporations, particularly in the current increasingly competitive international marketplace. Supply chain development is currently driven by factors such as globalization, swift technological advancements and highly competitive marketplaces, with a number of firms joining hands and performing tasks they are most adept at. Mining corporations concentrate on mining activities, timber firms are focused on lumber making and logging, and production firms concentrate on various kinds of production, right from component production to ultimate assembly. In this way, all firms keep pace with the swift changes characterizing the current era, and keep updating their skills and knowledge to remain competent in the marketplace. Where, at one time, firms operated independent warehouses and truck fleets, they are currently weighing up whether such operations are actually a core organizational competency or outsourcing these tasks to other firms whose core competency is logistics would be a better idea. For achieving high operational efficacy levels and remaining updated on ongoing technological changes, firms must pay attention to their core competency. Such focus is crucial to remaining ahead of competition (Hugos, 2003).

Literature review

Supply chains include firms and business activities necessary for designing, making, delivering, and using services/products. Companies rely on supply chains for offering them necessary elements for surviving and thriving. All firms fit into at least one supply chain, where they have some definite part to play. Uncertainties linked to market evolution and the pace with which change occurs has rendered awareness and understanding of supply chains and operating rules increasingly vital for organizations. Organizations that can capably forge and engage in robust supply chains enjoy a substantial edge over competition (Hugos, 2003).

Integrated SCM systems form the backbone of e-business goal attainment. While “SCM” has been defined in several different ways by different authors, the need for it is clear: firms have been struggling to attain efficacy in the areas of sourcing, production and delivery. Efficiency of supply chain – i.e., to have the right products at the right time and place – may bring about customer service improvements, besides facilitating cost-cutting efforts. The business domain is now moving at an unprecedented pace, rendering agility and adaptation to changes highly salient for all e-businesses and their infrastructure (Shaojun & Zhang, n.d).

Sound SCM necessitates concurrent customer service improvements as well as improvements to individual supply chain members’ (organizations’) internal operational efficiencies. The most elementary level of customer service involves consistent high rates of order-filling and timely delivery, and extremely low product return rates. Internal efficiency with regard to supply chain firms implies the firms enjoy a lucrative Return on Investment (ROI) rate in assets (including inventory) and find ways of lowering sales and operational expenses. SCM operation is characterized by a basic practice pattern.

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All supply chains have their own distinctive operational challenges and market demands; nevertheless, identical problems are evident in all cases. Firms belonging to all supply chains need to engage in independent as well as collective decision-making with regard to their activities in the domains of inventory, manufacturing, location, information and transport (Hugos, 2003).

The above decisions collectively help define supply chain efficacy and capabilities. What a firm can do to remain competitive and how it can do it is highly reliant on supply chain efficacy. If an organization’s strategy is serving mass markets and competing based on price, the prudent thing would be to forge its supply chain keeping in mind optimization for decreasing costs. Likewise, if the corporate strategy is serving a particular segment of the market and competing based on customer convenience and service, optimization for supply chain responsiveness is needed. A firm’s market and supply chain influences who the firm is and the function it performs (Hugos, 2003).

Information constitutes the basis of decision-making with regard to the remaining drivers of supply chain, namely, inventory, manufacturing, location, and transport. It forms the link between all supply chain operations and activities. As long as the link is sound (or information is precise, complete and delivered on time), supply chain players can all make sound decisions to aid their respective operations. This facilitates supply chain profitability maximization in general. This forms the principle of operations of free markets such as stock markets, whose supply chains share some common dynamics with other markets. Supply chains put the information they have to two uses: 1) coordination of everyday affinities linked to the remaining drivers’ functioning and, 2) planning and forecasting for anticipating and meeting upcoming demands (Hugos, 2003).

When the members of a given supply chain display readiness to team up and engage in information-sharing with each other, it becomes possible to coordinate the tasks of product introduction, development, and replenishment with the use of optimisation-based advanced scientific techniques. “Intelligence” makes information powerful; the subsequent frontier is its integration into every supply chain process element. Data-sharing constitutes a foundational SC integration step, enabling firms to enjoy POS (point-of-sales) visibility, in addition to information such as demand forecasts, shipment planning, inventory, and capacity. After achieving visibility, intelligence assists in: 1. Identifying when things go beyond control, necessitating colossal information synthesis for understanding trends and patterns. 2. Identifying means of resolving the scenario. 3. Creating reaction plans, and 4. Coordinating and synchronizing plans for every supply chain entity for ensuring they work harmoniously (Lee, 2002).

When cellphones and other such products take lesser time to get outdated than the time taken by supply chains to transfer them from the developmental stage to store shelves, manufacturers clearly fail unless their planning and supply chain function execution takes place at extreme speeds, flexibility, and precision. In these increasingly typical instances, one will find virtually no error margin for huge demand shifts and serious disruptions in the supply chain. Previous inflexible, sequential production resource planning instruments have, for long, been failing when it comes to SCM of any complexity or size (Chen & Hasan, 2008).

Over the last few decades, web-based shopping has been taking up a continuously annually-increasing share of American retail sales, a trend that has made it critical to pay attention to the e-commerce domain, where SCM approaches are devised and executed bearing in mind the needs of internet shoppers. For keeping pace with e-commerce’s growing retail sales share in America, SCM professionals have been pivoting for….....

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