"Out of Stock!", As a customer, when you see this message, the disappointment level is an all-new high. Isn't it?
But as a business owner, this can be a costly mistake.
Improper supply chain management is the main reason behind products going out of stock despite high demands.
It doesn't matter what is happening in the market or around the world. Your customers still expect you to keep up with the supply.
While you cannot perfectly predict when the supply for a particular product will rise, you can definitely predict closer to perfect with the help of proper supply chain management software.
SCM software leverages real-time data and internal demand trends to help you gain insights into future supply demands.
Moreover, with SCM software, you can handle materials, order fulfillment, information tracking such as suppliers, wholesalers, manufacturers, transportation, providers, retailers, and so much more.
Successful supply chain management isn't just about predicting future demands, managing inventory, but also creating excellent customer experiences.
However, there is a misconception that supply chain management software is only for large and medium-sized companies due to its cost. But it is far from true.
If you are a small business owner who oversees supply chain management activities, there are various supply chain management software vendors providing affordable cloud-based software for your business. This software can help increase your efficiency and reduce the operating cost without breaking the bank.
It doesn't matter if you are a pizza shop owner or a mass manufacturer dealing with thousands of suppliers. Supply chain management software can help you streamline your business.
So if you are looking for a supply chain management system, you are at the right place. Below, we have created a list of the top best supply chain management software programs for you. Have a look.
List of Top 10 Supply Chain Management (SCM) Software
NetSuite was founded in 1998 by Evan Goldberg, and was one of the first companies to provide business solutions over the cloud. Over the years, its popularity skyrocketed. As a result, Oracle acquired NetSuite in 2016 for the sum of USD 9.3 billion.
It is a fully cloud-based supply chain management solution with rich features such as real-time visibility into the supply chain. NetSuite's planning and execution modules make it easy to execute business plans even if your manufacturing occurs across the continent. The work order management provides transparent and accurate insights into the manufacturing process irrespective of location, time, and subsidiaries. With NetSuite, your supply chain will work seamlessly with minimal efforts from your side.
- Demand Management
- Warehouse Management
- Inventory Management
- Analytics and Reporting
- Customer Relationship and Management
- Professional Service Automation (PSA)
- Audit Trail
- Tax Management
- Workflow Management
- Cost Management
- Supply Chain Tower is the most advanced feature that gives you a real-time view of your current and future inventory position.
- The Demand Planner lets you forecast product demands using historical data and imported sales forecast data.
- Pre-configured and easy-to-use customer and vendor portals. That means users will only see the information you want them to see and can collaborate quickly.
- Purchase order management feature helps manage vendors, products receipts, relevant transactions in one place.
- NetSuite can effectively work with businesses having multiple languages, currencies, subsidiaries in different countries.
- Tax management is an exceptional feature that helps understand, track, calculate, and pay different types of taxes according to products or services.
- Pricing starts from $499/month. NetSuite follows customized pricing.
- Free trial: No
- Free Plan: No
It is all-in-one SCM software offering a complete set of product, inventory, and order management; best suitable for fast-growing businesses, startups, and SMBs due to its high scalability.
2. GEP NEXXE
GEP NEXXE is an AI-powered digital supply chain management software. Built on a state-of-the-art Data Lake, it is powered by GEP Minerva AI. Due to being fully cloud-based, your organization does not need to change any of your infrastructures to accommodate GEP NEXXE.
NEXXE is one step forward and provides high-level flexibility, agility, and customization features as opposed to legacy supply chain management solutions. The GEP NEXXE has been designed for global supply and demand networks with complex operations. It helps enterprises prepare for a rapidly changing market environment and real-time visibility and control over the end-to-end supply chain. Moreover, NEXXE quickly integrates with all third-party and ERP systems.
- The inventory and warehouse manager gives an immediate snapshot of the business to take decisions.
- Logistic planner using embedded telematics provides rich data combined with RFID support for packages and containers.
- The Should Cost enables the supply chain team to estimate the actual prices of goods purchased at any point.
- Highly scalable due to fully cloud-based infrastructure.
- Minimizes the risk with its risk assessment features.
- With a Logistics manager, you would always have real-time visibility into raw materials, finished goods, and components.
- The Should-Cost feature saves plenty of time and errors in pricing the goods and brings greater savings and better-priced products.
- GEP NEXXE is available on quote-based pricing.
- Free trial: No
- Free Plan: No
Why GEP NEXXE?
Supply Chain involves a lot of complex parts which need to be handled with care. Thus, GEP NEXXE provides your team with real-time visibility in all parts of the supply chain, including logistics, raw materials, manufacturing, delivery tracking, etc. Moreover, its advanced AI and the data-centric platform is a definite plus to maximize the potential and provide real business value.
3. Infor SCM
Infor SCM is an enterprise supply management software built on Infor ERP and data analytics technology. It is fully hosted on the cloud and is available on all devices, mobile, tablet, and desktop.
Supply chain, product lifecycle, and warehousing modules are available independently or as a part of the supply chain system.
Infor's Enterprise resource planning software M3, which operates in 19 different languages, has been applied to supply chains in many industries, such as food and beverage, retail, fashion, chemicals, and equipment.
Infor currently serves over 68000 customers worldwide in more than 100 countries. It was also recognized as a leader in ERP Technology Value Matrix by Nucleus Research in 2020 for delivery industry specialized functionalities and integration with the best solutions including SCM, EAM, HCM, and PLM,
- Integrated business planning
- Demand Management
- Supply Management.
- Warehouse Management
- Production Planning and Scheduling
- Infor Nexus
- Manage working capital: Unlock better rates and protect sellers from buyer payment default through payment protection.
- Infor Nexus can help connect banking, suppliers, manufacturers, 3PLs, etc. It is a single instance platform to connect financial and physical supply chain processes over a cloud platform.
- Infor's planning and demand management help optimize inventory, service, and performance across the supply chain.
- Infor's warehouse and freight management helps manage both local and international warehouses. It also ensures that supply chain cost and speed are aligned with customers' needs and market demand.
- Infor follows a subscription pricing model. Businesses need to pay per user per month for using Infor SCM.
- Free Trial: No
Infor is the only company that combines planning and execution records with multi-enterprise networks, platforms. This way you get the best of both worlds. Moreover, it helps increase speed to market through its rich features like dynamically allocated inbound inventory, prescriptive insights, and demand sensing, etc.
4. SAP SCM
SAP is the market leader with the largest share in the software market. With over 75 offices and operations in 120 countries and 37 languages, SAP SCM has the widest reach among all other software.
Founded almost five decades ago in 1972, SAP has experienced all the trends in the technology industry and research heavily to meet customer's demands. SAP SCM is SAP-integrated supply chain management software that increases agility in responding to market demand. Its state-of-the-art technology is built to grow your business rapidly.
Optimizing your supply chain with SAP SCM can transform your business. Its powerful functionality like business analytics and prediction, production planning, logistics management can help you run your business effectively and profitably.
Colgate-Palmolive is among SAP SCM's satisfied customers.
- Inventory Optimization
- Demand Forecasting
- Sales and Operation Planning
- Response and Supply Planning
- Enhanced compliance
- Easy Integrations with other SAP products
- Faster and Efficient Onboarding
- Dashboard to manage all tasks from a single place.
- Intelligent spend management
- Supplier Management
- With its faster order fulfillment features, you can provide excellent customer service as the orders are fulfilled on time and shipped on time.
- Reduce manufacturing error rates such as wrong product configuration, thus lowering the production cost by almost 20%
- Quickly respond to newer market trends by changing production planning.
- Synchronize data and workflows among different business units and stakeholders to improve communication and production.
- SAP follows a subscription pricing model. Therefore, business needs to pay per user per month for using SAP SCM.
- For more details on pricing or a custom quote, please contact the SAP SCM team.
Why SAP SCM?
SAP is an industry leader in the software market, along with decades of experience. As a result, all their products undergo intensive testing, and SAP SCM is no exception.
Today, Millennials and Gen Z make up a significant part of the workforce. Oracle Cloud SCM attempts to meet the expectations of future employees by leveraging a mobile device platform, enabling work anywhere, anytime, enhancing career satisfaction, and increasing productivity.
Oracle Cloud SCM is a fully cloud-hosted supply chain management system. It aims to unify end-to-end business processes, considering the ever-changing requirements of supply chains. The innovative solution can help save millions of dollars and bring efficiency to your supply chain.
Moreover, Oracle Cloud has multilayer security to protect your data. Customer access to the cloud is encrypted with an option to connect to a secure VPN. As a result, the data of each customer is separated. This minimizes risk and provides embassy-grade security.
Brands using Oracle Cloud SCM include The American Red Cross and Lorven Technologies.
- Inventory Management
- Product Lifecycle Management
- Order Management
- Faster Implementation: As Oracle Cloud SCM is hosted on the cloud, it is much faster to implement than the on-premise option.
- Save cost in IT: On-premise applications have much higher upfront costs, as well as the, company needs to maintain an IT team to maintain and upgrade the software system. However, Oracle Cloud cuts dependency on IT teams and lowers maintenance costs.
- The newly added replenishment planning feature helps businesses anticipate consumption, planning and replenishing resources accordingly.
- Backlog Management feature helps in prioritizing the important orders first so that they can be fulfilled on time. Unfortunately, many businesses operate on a ''first come, first served'' basis. However, Oracle Cloud SCM is changing this.
- Channel Revenue Management automates settlement and processing within the cloud. This greatly reduces the burden of managing multichannel revenues, especially for global supply chains.
- Free trial: No
- Planning Central: $500 /month/ user
- Demand Management: $300 /month/user
- Sales and Operations: $500 /month/user
- Supply Planning: $300/month/user
Why Oracle SCM?
Oracle takes special care in protecting customers and business data by advanced security architecture. Overall, it's a user-friendly and intuitive SCM solution that is updated regularly and is suitable for optimizing business operations by connecting the supply chain over cloud applications.
With 20+ years of experience in the SCM field, Coupa has perfected its supply chains functionalities. Coupa provides cutting-edge procurement and business spend solutions for enterprises around the world. Coupa combines the best e-procurement and expense management capabilities to form a single solution which is faster to deploy, easier to use, and cost-friendly than any other service out there.
By leveraging Amazon Web Services, Coupa continues to provide benefits to its customers which include procurement, over-billing prevention, future spend prediction, increased operational efficiency, and allowing customers to focus on their core business strategy.
Coupa Supply Chain Modeler is an innovative modeling tool that helps businesses transform the design from a one-off project to a consistent and repeatable process.
Gartner and Forrester highlighted Coupa as the leader in procurement. Coupa is used by popular brands like Uber and P&G.
- Supplier Information Management
- Smart Integrations
- Community Intelligence
- Business Spend Management
- Expense Report Auditing
- Predictive Analysis
- Coupa's smart integrations help in easy connecting SAP and Oracle software with your existing ERP. No need for custom coding or high-cost support.
- Coupa's Supply Chain Modeler is all in one, designing solutions that can help you transform one-off projects into a repetitive process.
- Increase efficiency with automatic payment reconciliation and eliminate manual invoices.
- Get the most out of your liquidity by taking advantage of early payment discounts with community intelligence.
- Reduce errors and frauds through compliant workflows and transparency.
- Reduce supplier risk by assessing supplier risk in community intelligence
- Improve performance by automating cash management and settlement across multiple subsidiaries, currencies, accounts, and users.
- Coupa follows quote-based pricing.
- Deployment: Cloud-based
- Demo: Yes
- Free Trial: No
Coupa is a leader in providing exceptional services to its customers. Moreover, their technical and IT teams are constantly improving services and delivering innovative features. With Coupa, customers can reduce overhead costs, manage expenses and increase profits.
7. JAGGAER SCM
How many times have you rejected suppliers just because they were EDI (Electronic Data Interchange) equipped? As a business, EDI is important in various ways, but if you have been only limiting yourself to suppliers having EDI capabilities, then you are missing out on almost 41% of suppliers! But with Jaggaer SCM, you don't have to limit yourself. You can deal with a direct material supplier through the Jaggaer Supplier Network. Moreover, their special analytics system called Spend Analytics is helpful in finding cost-saving opportunities within the supply chain using accurate data analysis.
Notable clients include Rolls-Royce, Virginia Tech, Unilever, Oklahoma State University, University of New Mexico, and so on.
- Embedded Intelligence
- Supplier Management
- Quality Management
- Inventory Management
- Spend Analytics
- Category Management
- Self Service Portals
- Vendor Management
- Automatically generate shipping labels and barcodes and integrate directly with third-party logistics
- Stay up to date with delivery information and ensure the orders are delivered on the proper time and place with the Jaggaer ERP system.
- Robust integrations allow new systems to coordinate with the already reestablished ERP system.
- Purchase the materials at the same for all the international locations, by suppliers and price data transparency.
- Automate quality management to minimize risks associated with new products in production and manufacturing.
- Find saving opportunities and grow revenue using spend analytics.
- Jaggaer follows quote-based pricing.
- Deployment: Cloud-based only.
Every business's main aim is to reduce costs and increase profits, and that's what Jaggaer helps businesses with. With 25 years of experience in the field, and connecting 4 million customers in 70 countries, Jaggaer has perfected spend solutions. Along with that, they regularly conduct customer surveys to know the requirements of customers. Hence, be rest assured that your problems will not be ignored.
For the past 50 years, Epicor has provided enterprise solutions to customers in industries like manufacturing, LBM, retail, distribution, etc. Epicor is a firm believer in a ''no one size fits all'' approach. Instead, they aim to provide highly tailored technology platforms focusing on serving the needs of end-to-end supply chains.
The company's product Kinetic, a cloud-based ERP, is focused only on helping manufacturers. The company serves businesses in various industries. For distribution, Epicor has a product named Prophet 21 hosted on Microsoft Azure and comes with modules like accounting, CRM, etc. Epicor is user-friendly, highly customizable, and provides tailored solutions for unique needs. However, some businesses may find it a bit pricier than another SCM solution on the market.
- Advanced Material Management
- Warehouse Management
- Inventory planning and management
- Electronic Data Integration (EDI)
- Purchase Management
- Commerce Connect
- EDI features offer B2B integrations that provide you with EDI facilities along with flexible data integration and database management to reduce costs.
- Enhance cash flow, manage inventories, and improve on-time deliveries with the purchase management module.
- Ecommerce solution Commerce Connect promotes the growth of online businesses. Commerce Connect offers mobile access, B2B and B2C channel support, SEO, site analytics, and attractive storefronts.
- The warehouse management module enables warehouses to connect with order processing and manufacturing processes to optimize pick, pack, ship, and receive operations.
- Epicor BarTender improves security, safety, and efficiency by automating bar code generation along with printing labels and RFID tags. It helps maintain regulatory compliance and secure document control.
- Epicor follows a quote-based pacing
- Free trial: No
- Free Demo: Yes
- Deployment: Both on-premise and cloud-based.
Epicor is a highly customized SCM according to industries. This means businesses don't have to make customizations to make the software adaptable for their business. Doing so saves time and makes it easy to deploy the services quickly.
The E2open provides unified supply chain management with capabilities such as demand sensing, global trade management, Harmony, business planning, warehouse and inventory management channel shaping and so on. Unified action plans align internal departments and external partners with the company's objectives.
E2open currently serves more than 1200 users with 125 of those being the largest brands in the world. Each of these 125 clients generates more than 10 billion in revenue per year across industries such as high, consumer, industrial, transportation, and so on.
On the flip side, E2open does not offer a multi-user user system, which can be problematic if one wants to add team members. Furthermore, if you need API or third-party plugins to run your business, E2open may not be a suitable choice as it does not provide both the service.
- Inventory Management
- Transport Management
- Order Processing Management
- Warehouse Management
- Supply chain planning
- Demand Management
- Procurement and sourcing
- Demand sensing suite's increased accuracy can help reduce forecast errors and save time and money.
- Business Planning suite's help in optimizing financial goals and performance metrics using fact-based planning. The suite provides a platform for agile decision-making. Business owners can create a digital representation of the supply chain to address market volatility, variable demands, etc.
- Connect with the world's largest carrier system for flexible shipments across air, water, ocean, rail, and roads with a transportation and logistics suite.
- The transportation and logistics suite helps manage all the shipping-related activities from one central place. This centralization helps reduce costs and risks, which are common in traditional logistics systems.
- Harmony is a supply chain collaboration platform designed by the E2open team to provide users with an end-to-end business ecosystem for planning, executing supply chain operations.
- The Supply Management suite helps in gaining full control over supplier networks. In addition, it helps in managing even the most complex procurement process.
- E2open follows a SaaS-based subscription pricing model. As a result, users only need to pay for functions and features relevant to their business.
- Free trial: No
If you are a large or medium-sized company with 10,000+ employees and more than $100 million in revenue, E2open is the most suitable option for handling supply chain operations. Their collaboration tool, Harmony, is one of the most advanced communication tools that foster effective communication with suppliers and manufacturers in one place.
With over 1.2 billion products and service users, Microsoft has consistently held the top position in the software market since its foundation. In addition, its easy-to-use and affordable solutions attract businesses and individuals from all over the world.
Microsoft Dynamics 365 is a cloud-based supply chain planning software that combines traditional ERP and customer relationship management systems to create a singular, powerful system. With Dynamic 365, you only pay for what you use. In addition, with its rich app store, you will have powerful apps at your fingertip to expand the software's functionalities.
The integrated predictive analytics, Microsoft Azure Machine Learning, and Cortana Intelligence ensure that you are always able to access accurate and predictive business data.
Businesses can optimize and manage inventory across various channels through the multichannel selling feature.
- Inventory and logistics management
- Automated warehouse operations
- Simplified procurement process
- Handle Agile manufacturing
- Improved overall equipment process using IoT and Mixed Reality
- Effectively geographical asset management
- Power BI Analytics
- Predictive insights to accelerate production planning
- Field service integration to improve resource management and manage the workforce, machines, and tools.
- Pay only for features you use: With Dynamics 365, businesses do not have to pay extra for features they may not use. As a result, operating costs are drastically reduced.
- Intelligent insights: Microsoft's Intelligent AI tool, Power BI, is natively integrated with Dynamic365 SCM, bringing limitless and powerful analytical insight for your business.
- Higher security and compliance: Worried about losing data? With Microsoft handling all the back-end functioning, you can sleep at night without worrying about someone hacking into your data.
- Hyper-connected: If you've faced problems integrating third-party applications with software, you understand how inconvenient it can be. Fortunately, Microsoft is best at connecting all their products together to provide a unified way of working and managing the business.
Microsoft Dynamic 365's base plan starts at $180 per month per user. For more pricing information, contact their support team.
- Free trial: 30 days
Why Microsoft Dynamics 365?
Microsoft's popular apps such as Office 365, Microsoft BI are some highly used apps. If you are already familiar with Microsoft apps, then Dynamics 365 is a perfect addition to your company, as it can easily integrate with other Microsoft apps.
Supply chain visibility and control are now vital factors in determining the success of a brand. However, managers are still using outdated systems for managing supply chains, such as emails and spreadsheets. Not only are these systems unorganized, but they are prone to errors and time-consuming.
Enters Anvyl. Anvyl is an intelligent supply chain management system that enhances real-time visibility into supply chain activities. Anvyl is packed with automation and collaboration features needed to increase output, optimize processes and grow the business.
- Automated milestone tracking
- Complete Audit Trail
- Logistics visibility
- Centralized document management
- Supplier Directory
- Order Delay Risk Analysis
- Order Delay Risk Analyzer can help in identifying events and managing them to avoid shipment delays.
- Report features provide multiple useful reports like goods expected to deliver next month, top suppliers, goods sold, etc.
- Automated milestone trackers help in monitoring deliverables with automated supplier check-ins.
- Using the Audit Trail feature, you can easily keep all the parties updated on operations downstream.
- Get centralized access to bills of ladings, invoices, quality checks, and other important documentation using document management features.
- Using Logistics visibility, you can track the location of your goods at any point during transit.
Anvyl has a free trial available. Anvyl has three pricing plans as follows:
- Starter: Starter plans start at $500/month and include basic features such as order automation, collaboration with suppliers, and data centralization.
- Professional: Starts at $1500/month. Features include everything in the starter plan along with Anvyl IQ, Sourcing, and integrations.
- Enterprise: Requires custom quote. Features include everything in the professional plan along with advanced integration such as SSO and priority support.
Anvyl is the best choice for all types of business because when you are just getting started, you may have no idea what to expect or how large you want your business to be. Hence, Anvyl provides an easily scalable SCM platform that will grow with your business. Moreover, small businesses can get started instantly with Anvyl using the basic features in the starter plan.
Supply Chain Management (SCM) Buyer's Guide
» What is the Meaning of Supply Chain?
The most basic definition of supply chain is, a model or framework that depicts how information and products move through value chains to produce a product or service to meet customer requirements.
» What is the Definition of Supply Chain Management (SCM)?
The terms, supply chain management and supply chain are often used interchangeably. However, they are different. An SCM definition can be found below.
Supply chain management (SCM) is a seamless integration between activities like design, planning, execution, manufacturing, sourcing raw materials, and transportation to create a net value and build a competitive infrastructure by producing products and delivering them to end customers.
Supply chain activities are complex in nature and depend heavily on industrial engineering, system design, logistics, procurement, operation management, marketing, and information technology.
» How Does Supply Chain Management (SCM) Work?
A supply chain involves all the steps needed to create a product or service until it reaches the end customers. SCM manages all the steps from design, production, manufacturing raw materials into finished products, transportation, and delivering it to the end customer.
The entities involved in supply chains include manufacturers, transportation companies, vendors, warehouses, retailers, and distribution centers.
Supply Chain is an integral part of every business. However, it requires skills and expertise to run effectively.
When effective, it can help reduce time, cost, and waste. But if not handled properly, it can quickly overhead expenses, late product deliveries, and so on.
Let's see how SCM works.
There are five components in the supply chain management process. They are:
To meet customer's demands, supply chain businesses have to work in advance. Which means they have to forecast and predict the demand for products in the near future. Moreover, supply chain managers also have to design and plan the supply chain in such a way that it will help meet customer's demands, increase efficiency and meet the business goals.
In the previous step, supply chain managers decided what products to create and how to create them. In this step, supply chains will source all the materials required to create the finished goods. This includes raw materials, labor, suppliers, tools, and machinery, etc.
The supply chain manager is responsible for managing inventory and ordering items, receiving raw materials and shipments, and authorizing invoices for suppliers as part of strategic sourcing.
In the sourcing stage, all the raw materials and labor were gathered to create a product. Now it's time for production. In this step, supply chain managers help coordinate all the steps involved in creating a product. This includes accepting raw materials, manufacturing the products, quality testing, and packaging.
In the previous stage, the product was created and packaged successfully. Now it's time to deliver it to the customers. Logistic management systems are used to ensure the product reaches the end customers. This includes coordinating orders, scheduling delivery, dispatching the products, invoicing, and receiving the payments.
In the delivery stage, there are two options. Either the organization arranges the fleet of delivery vehicles or outsources the delivery to a third party to handle the requirements like home delivery.
The supply chain does not end with delivery. There are many cases when the customer returns the products due to the product being defective, broken, etc. Also, there are some cases, when the company can ship the wrong product mistakenly. To handle such cases, supply chain needs to build a strong network for returning products.
A responsive and flexible return network is needed to satisfy the needs of the customer.
» What is the History of Supply Chain Management?
The history of supply chain management areas such as logistics goes back to the ancient era. The empires from Peru to Rome left their mark on logistics, including building roads, organized labor, armies, and transports.
Until the 18th century, before the industrial revolution, most parts of the supply chain were local in nature and had high restrictions due to higher costs of transportation and lack of larger transportation options. This changed after the industrial revolution.
Although the concept of suppliers, distributors, manufacturers is nothing new, the concept of the supply chain was not known until the 1980s. Hence, the SCM field is new compared to manufacturing, logistics, procurement. However, all these fields play an important role in supply chains.
Kieth Oliver coined the term Supply Chain Management in 1982. After the publication of 'Introduction to Supply Chain Management' in 1999 by Robert B. Handfield and Ernest Nicholas Jr., the term gained widespread use.
The supply chain management history underwent various changes. Let's look at them.
› Creation: The humble beginning of the supply chain
This phase started with the creation of assembly lines in the early 20th century. Things such as the need for large-scale changes, cost reduction programs, re-engineering, downsizing, and widespread attention to Japanese management practices were introduced during the creation phase.
› Integration Era: Logistics and Computing
The 1980s brought improvements in the supply chain with the invention of personal computing. Now, Logistics has access to a graphical interface and technology for planning and production, companies were able to reduce operating costs and save time.
Enterprise resource planning ERP software was introduced in the integration phase. With the invention of ERP systems, companies were able to connect several databases, and logistics boomed even further.
By the end of the year 2000, nearly all the major companies had ERP software as it showed how technology could be used for improving the operation, reducing cost, and saving time.
This phase has continued to develop in the 21st century with the invention of the internet-based collaborative system. Thus, the era is characterized by cost reduction and increasing value.
› Globalization: The Era of Expansion and Transformation
Thanks to globalization, today, the supply chain industry is worth over 400 billion USD. The globalization era of the supply chain started with the growth of manufacturing in China in the mid-1990s. China's exports to the US soared from 45 billion in 1995 to $280 billion per year in 2006. The increasing complexity of managing global supply chains became evident when global demand and supply skyrocketed.
› Supply Chain Management 2.0: The Present
The history of supply chain management has been phenomenal, and now that brings us to the present. The new era of supply chain management started with the explosion of manufacturing in Asian countries like China, Japan, and Korea.
Moreover, at the same time, the boom of predictive analytics, Artificial Intelligence, and machine learning has enabled companies to predict change, forecast trends, optimize operations, enhance order, and supply management, etc.
Now, the supply chain is evolving and moving towards a data-driven, network-based, and collaborative supply chain management system. This will help deliver real value and growth for all the participants in the supply chain.
And, of course, many changes are coming in the supply chain field and participants in the supply chain must be ready to tackle these upcoming challenges.
Let's look at some future trends in supply chain management.
» What is the future of supply chain management?
In recent years, artificial intelligence, big data, and automation have been disrupting many industries. That calls for the question ''What will the future of supply chain management look like?
For instance, suppose you own a business that stores around a million steel beams. In traditional SCM, you would probably hire an employee to conduct a physical inventory of the product. However, there are loopholes in this traditional SCM system. They are:
- It is time-consuming.
- It is dangerous
- It is inaccurate.
But, with the help of automation and AI, you can keep track of real-time inventory levels with more accuracy and faster speed. The use of technology helps automate repetitive, mundane and, dangerous tasks—a win-win situation for both employees and employers.
Now, let's talk about future trends in the supply chain industry.
Blockchain has been a controversial topic for the past few years. It has been called the biggest breakthrough in technology. Blockchain is primarily used for improving transparency and safety.
Improper data sharing is often the biggest obstacle in the supply chain industry. But through Blockchain, you can start sharing data uniformly with concerned parties. As compared to cloud sharing platforms, blockchain is more secure and incorruptible.
Since customers today demand transparency in the process and secure transactions, Blockchain can act as a valuable resource.
Moreover, cryptocurrencies like bitcoin that are part of blockchain have skyrocketed in popularity. As the government starts recognizing cryptocurrency for trades, more companies are adopting them. For cross-border traders, cryptocurrencies can become a norm for transactions, as it is more secure, transparent and faster than traditional systems.
Recently, Walmart started using blockchain to trace the supply of Chinese pork supply chain.
Another example is a shipping company based in Hong Kong that successfully uses smart contracts to combat unreliable deliveries and payments.
2. Artificial Intelligence and Machine Learning
AI has been disrupting industries since the previous decade. Most industries have found success with AI, which means the trends will continue in the future.
With the help of AI and Machine Learning, organizations can gather lots of data and forecast future demands effectively. Moreover, it can automate repetitive and mundane tasks, thus saving time and costs. It also eliminates the possibility of errors, which is a common scenario with manual handling.
Therefore, companies can use this opportunity to redirect employees to work on more complex tasks instead of performing repetitive tasks.
3. Internet of Things
Apart from AI and blockchain, companies have been rapidly adopting IoT in supply chains. The Internet of Things is the network of physical objects connected by sensors and software, which in turn are connected by the internet.
IoT strives to provide more visibility and transparency in the supply chain. For example, the GPS sensors in delivery trucks can help track the live location of the order. The sensors in inventory can help manage inventory levels and so on.
Moreover, IoT can also be integrated with other technology for added benefits. For example, sensors in warehouses can collect data that can be then used to automate tasks like asset management and forecasting.
4. Sustainable Practices
As more consumers continue to move towards eco-friendly products, more and more businesses continue to adopt sustainable supply chains. However, it is easier said than done.
In the coming years, businesses will focus on sustainable manufacturing or move toward a zero-waste mentality. However, this shift towards sustainability would be difficult as companies need to change the way they source raw materials or transport the products to end customers.
But, companies can start with small efforts such as eco-friendly packaging. Then, by making slow but deliberate changes, companies can move toward sustainable practices without getting burned in the process.
5. Risk Management and Resiliency
It's no secret that supply chains are volatile and involve a lot of risks. A minor interruption in the chain of events can be catastrophic.
Supply chains cannot control disasters like market crashes, economic slowdowns, natural disasters like earthquakes, floods. However, they can control how they react and prepare in such situations.
As a business, it is your responsibility to reduce risks to a minimum and increase the flexibility and resiliency of the supply chain to keep it stable. For that, you first need to find the biggest potential disruptors. For example, if you source raw material from a political area, try sourcing from another geographical area to keep the supply stable.
In simple words, thinking about major disruptors and planning in advance can help the supply chain survive amidst uncertainties and risky situations.
6. Focus on strengthening relationships
In supply chains, both technology and humans play major roles. As a result, every individual who forms part of the supply chain is crucial. Hence, communication is of paramount importance. Besides allowing you to strengthen your relationship, it also provides you with valuable information and data.
Instead of competing with each other, one can focus on finding a common link to help each other grow.
7. Circular Supply Chains
Traditionally, all supply chains are linear. Meaning the first step starts with sourcing raw materials, manufacturing, and so on. The goods move in a straight line until they are finished products.
However, things are changing. More individuals and companies have been adapting to the idea of a circular supply chain, wherein the raw materials or waste products are recycled and reused.
The advantage of a circular supply chain is that it is not only sustainable, but also beneficial from an economic point of view. As we all know, the earth has limited resources, and with time, raw materials will get costly. Circular chains reuse all the raw materials and waste, and hence save resources.
Furthermore, strengthening relationships and usage of AI can help in circular supply chains where companies can share raw materials, resources, information to stop wastage.
8. Agile Supply Chain
Supply chains need to be agile enough to absorb any shocks or economic downturns. This also includes natural disasters or unpredictable demands.
Another thing where agility can benefit supply chains is personalization in the shipments of orders. Currently, all the shipments are created in bulk based on pre-orders. Therefore, any changes in cargo amidst the supply chains are impossible to handle.
However, this is going to change soon as more companies shift power to customers. The need for customization is evident and would give an edge over competitors.
More and more companies will build infrastructure to allow the personalization of orders within supply chains without adding to further costs.
» What is Supply Chain Management (SCM) Software?
A supply chain management software is a set of tools or modules that helps in execution, planning, handling transactions, dealing with suppliers, manufacturers, and distributions, etc.
The main purpose of supply chain management software is to reduce costs and increase efficiency in business processes.
Moreover, SCM systems also help in designing, production, logistics by automating mundane tasks such as receipt generation, sales order management, documentation, etc.
The most important modules in supply chain software include:
- Inventory Management
- Workflow Management
- Warehouse Management
- Order Management
- Analytics and forecasting
- Sales order management
- Logistic Management
» What are the Benefits of Supply Chain Management (SCM) Systems?
Supply chains are complex and have many interconnected parts. As a consequence, poorly managed demand and supply can result in huge losses for investors and manufacturers alike. Supply chain management can come to the rescue in this situation. See the supply chain management benefits and why is supply chain management software important:
Advantages of Supply Chain Management Software include:
- Automation of mundane tasks such as order processing, invoicing, shipment tracking, and so much more.
- Advanced forecasting helps in predicting future sales trends based on current and historical sales data.
- It supports seamless collaboration between suppliers, manufacturers, distributors, and employees.
- Provides real-time visibility across the networks (like suppliers, distributors, storage, delivery) to give you a better understanding of all the processes.
- Reduces cost and time by identifying excess inventory and loopholes in logistics and production chains.
- Supply chain management software provides the tool to increase revenue by supporting better manufacturing systems, improved collaboration and communication, faster problem-solving, and risk handling.
- The data records present in the software make sure your supply chain follows regulatory compliance. Also, you can quickly generate and provide audit reports.
» What are the Features of Supply Chain Management Software?
1. Inventory Management
For smooth functioning of the supply chain, businesses must manage inventory effectively. As the inventory has various components like raw materials, finished goods, spare products or perishable goods, they must be stored at the proper place and at the right time.
Hence, inventory management features in SCM software help optimize inventory levels to ensure that businesses don't have to deal with overstocking or under-stocking. The Inventory management feature handles tasks like new orders, Bill of Materials(BOM), delivery receipts, raw material, and finished goods.
2. Order Management
Robust order and billing system are of utmost importance for the supply chain. The order management feature of SCM software handles all the order creation and billing clients from one centralized point.
It provides seamless integrations of orders from multiple channels with inventory databases, data collection, order processing, etc.
Orders manager handles order details, pending payment reminders, work order assignment, products, and customer details.
3. Analytics and Forecasting
Supply chains generate tons of data every day, like transaction details, raw material outsourcing, and so on. Data analytics features play an important role in analyzing this data.
You can use analytics tools to generate graphs, metric analysis, MIS reports with analytical tools.
Moreover, the forecasting feature uses previous sales and current sales history to forecast product demands in the near future. The forecasting feature is an absolute must tool as it saves businesses from situations such as products going out of stock or overstocking products.
4. Warehouse Management
Warehouse management tools allow your company to manage and optimize the warehouse capacity. Since warehouses are an important part of the supply chain, SCM lacking warehouse management tools can complicate and hinder your supply chain operations.
The warehouse management tools allow you to manage orders from multiple warehouses in different locations quickly and cost-effectively.
5. Product Lifecycle Management
Product Lifecycle management includes handling goods as it moves through stages like development, production, growth, stability. It also includes handling the manufacturing and marketing side.
PLM tools help businesses and organizations deal with the complexity and engineering challenges of developing new products.
It helps in reducing prototype cost, high-quality finished product, getting the product to the market faster, sales opportunities and reducing errors and wastage.
Moreover, PLM tools also help manage the design and documentation process of products, which makes things easier than proper documentation is a necessary part of product development.
Communication issues can crop up quickly if there is a communication gap between suppliers, manufacturers, and distributors.
Often, when all these parties use different communication channels, it can become harder to collaborate. Hence, the SCM software comes with a central collaboration feature that brings together the manufacturer, suppliers, and distributors in one single place irrespective of their location.
Moreover, most modern SCM solutions provide a self-service portal where all the parties can see the relevant information related to business or products and submit a ticket in case of queries.
This is less time-consuming and cost-effective, as the company does not have to manage various communication channels for each party.
Security is of the utmost importance in supply chains, as any kind of data leakage can wreak havoc on operations. Most cloud-based SCM solutions provide end-to-end data encryption, virus scanning, network monitoring, two-factor authentication, and role-based authorization to maintain privacy.
» What are the Different Types of Supply Chain Management?
There are six types of supply chain models.
- Continuous Flow Model
As the name suggests, continuous flow moves a single product into production instead of producing products in batches. This process was designed to generate a regular stream of product and information flow. The continuous flow model is generally suitable for mature industries where the customer demands don't change—for example, toothpaste. The demand for toothpaste is stable and doesn't change much.
As the products are continuously being produced, the supply chain can quickly make products available with low inventory.
- The Fast Chain Model
The fast chain model is suitable for industries that manufacture trendy products with short lifecycles. From a customer's point of view, what matters is how fast the manufacturers can update the product portfolio to keep up with the trends.
Three main capabilities drive the fast chain model: short production time, accurate trends forecast, and end-to-end efficiency to provide consumers with affordable costs.
- The Efficient Chain Model
This type of model is best suited to industries with very high competition, fighting for attention from the same group of customers. In these industries, production is based on the expected sales lifetime. The competition is solely based on the price of the product. Steel and cement industries fall under this category.
The sole objective of the efficient chain model is to maximize machinery utilization to reduce the cost.
- The Custom Configured Model
This model is suitable for products with multiple product configurations. The product configuration is usually performed during assembly, where the product configuration is assembled according to the customer's choice. Products like cars are best for this type of model.
- The Agile Model
The agile model is suited for industries where customers require products with custom specifications. This model uses the make-to-order decoupling point, where the production starts only after the customer places a purchase order. Companies following this model need to design manufacturing processes to create the smallest possible batches of products.
- The Flexible Model
This model is suited for industries with high demand peaks followed by low or no demand. For this model to be successful, companies need to quickly reconfigure the manufacturing processes to meet the high product demand and respond rapidly.
Adaptability and flexibility are the keys, along with strong technical strength and product engineering, rapid reconfiguration, and critical resources' extra capability.
It is common for companies to focus on having the capacity for these six supply chain models. But in reality, it is better to have parallel supply chains within the same organization, with each model tailored to serve specific markets or segments.
» What Factors to Consider When Buying SCM Software?
Choosing the correct SCM software is a very important process. As it makes sure that your supply chain is properly optimized.
The supply chain is the backbone of every industry, no matter what. Therefore, proper optimization of your supply chain can increase revenue and reduce losses.
The wrong choice of SCM system, though, will increase your headaches instead of reducing them. So to avoid such scenarios, we have created a list of features you must consider before you purchase supply chain management software.
Price is by far the biggest and most important factor in considering SCM software. SCM software has various features ranging from inventory management, delivery and logistics, warehouse management, analytics, and so on. Due to these extensive features, SCM software are not cheap.
Moreover, most supply chain software will run for more than a decade, hence you must also consider maintenance and support in your budget. But don't worry, there are many supply chain management software vendors that provide the SCM solution at an affordable price.
In the long run, your choices today will determine future budgets.
Integration is another major factor you must consider. Chances are, you may already have other important software installed for managing your supply chain.
You don't want to change multiple systems just because you are bringing in new software. Do you? Now the question is how will you integrate your existing software systems with your new SCM software? Can the SCM software read the data from your other systems? And so on.
Hence, it is vital that you choose the SCM software that will readily integrate with your existing systems without much effort.
Moreover, most companies today use Electronic Data Interface (EDI) for bills and transactions. Hence, if EDI is important for your business, your SCM system should allow the exchange of data between the companies. If not, then you either have to change your current software or move on to another SCM.
For global supply chains, the number of suppliers can increase dramatically. Due to this, it is necessary to consider both current and future needs before finalizing the SCM software. Hence, it is essential to have an SCM system that will grow with business demands. Today, most SCM solutions are cloud-based and are easily scalable. Cloud-based software does not require many resources and can be rolled out at multiple locations simultaneously.
4. User-friendly and intuitive interface
What's the use of buying software that complicates your task instead of helping you? Softwares are constantly evolving, and undergoing training to learn them hardly makes sense. On the other hand, user-friendly SCM software can make it easy for employees to leverage it to maximum potential without undergoing 10 hours of learning to navigate the interface.
5. Data Insights
In the supply chain, data is collected from various sources such as tracking and shipping, raw materials data, employees' data, etc. With so much data, manual handling can become a nightmare. Thus, the SCM software of your choice should provide AI and analytic tools to help analyze, sort, and visualize data to uncover hidden insights. Insights like these can help you improve how your business operates and reduce costs.
Some products have unique supply chain needs that not every software addresses. For example, if you deal with perishable goods, your software must consider critical timeframes such as expiry dates.
Another example would be pharmaceutical companies. These companies have to source raw materials, supply them to end customers, and do this in a controlled and safe environment.
As you see, each industry has its unique supply chain needs that need to be addressed. Hence, the best SCM software would provide customization according to industry-specific needs.
Humans are not perfect, but neither is software. Sometimes they can be buggy. Other times they may keep crashing. In such situations, you might want an urgent support service from your supply chain management software vendor. With every minute there is a delay in supply chain operations, the losses increase exponentially.
Hence, before you go choosing the SCM solution, make sure your vendors provide emergency support in case of problems.
» How Much Does Supply Chain Software Cost?
There are typically three supply chain management software pricing models, namely: Subscription-based, Perpetual License, and Commercial Open Source.
Under the subscription model, the SCM software is accessed over the internet as opposed to on-premise. The payment is made on a per-user, per month basis. Customers are needed to pay monthly recurring fees till they are using the services. More businesses are moving towards SaaS models due to lower upfront costs and maintenance. Generally, SaaS SCM software starts from $500/month/users and can go upwards to $2000/month/user
- There are fewer or no upfront costs for deploying the system with the SaaS model.
- In case the customer requires customer support service, the cost increases rapidly.
- Subscription models can be costly in the long term compared to perpetual licenses, as customers need to keep paying monthly fees until they are using the service.
2. Perpetual License
Perpetual license is the common pricing model for on-premise software. Customers have to pay a one-time upfront fee to own the software or intellectual property for a fixed term. On an average perpetual license, huge upfront fees starting from $30,000 and above, depending on features and numbers or users.
- The upfront costs typically include installation, customization, integration with apps, along with a license fee.
- Recurring costs in this pricing model are low as compared to subscription models. Typically, recurring costs may include occasional system updates, maintenance, patches, and upgrades.
- Companies have to maintain an IT team to manage software upgrades. In addition, the vendor charges extra fees for customer support service.
3. Commercial Open Source
Under the commercial open source license, customers can acquire the software free of cost. However, customers are on their own as they need to manage upgrades, updates, maintain the system, customize it to suit unique needs, etc.
Although there are some SCM solutions under this model, it is rare to see them. As software under this license is not partnered with any supply chain management software vendor, customers don't get customer support service, and in case of issues, it may become a nuisance.
Purchasing supply chain management solutions for your organization is a tough decision that you need to make carefully. Apply the tips from the buyer's section to choose the appropriate SCM for your organization based on unique needs. We have also listed the top supply chain management software companies that provide SCM solutions at affordable costs.
SCM solutions are a great way to digitalize the supply chain and optimize operations across manufacturing, production, planning, inventory, etc. Moreover, it helps in reducing costs by finding loopholes which might be eating up cash flow.