Role Of Technology In Service Delivery For Australian Firms

Areas where Australian Businesses face Challenges in Supply Chain Management

Discuss about the Role of Technology in Service Delivery for Australian Firms.

Supply chain management is the coordination supply of activities and operations of a company with the aim of maximizing customer value for the purpose of maintaining a competitive edge (Handfield & Nichols 2002). The concept has evolved with time. It has benefited from a number of innovations aimed at maximizing the customer value across the supply chain. It is no doubt that technology has increased profitability and efficiency in the entire supply chain. Even with the advancement in technology, there are still companies that lag behind; they have not adopted these technologies due to reasons that are hard to understand. Is it lack of awareness? Is it ignorance? If it’s none of these, then why have some of the companies not adopted the most efficient technologies available? When we talk of advanced technologies, which are they specifically? This article will explore some of the advanced technologies that can be used in supply chain management and their impact. Before dwelling on the topic, it is imperative to explore the areas where Australian firms are facing challenges within their organizations to manage supply chains.

Businesses are currently facing several challenges due to the ever-changing technologies which make it vital for them to ensure they have the most recent and correct technology to cope with the ever-changing business world. Australian retail firms, for instance, have been facing a number of problems which can easily be solved with the adoption of the appropriate technologies. Maintaining consumer confidence, loyalty and coping with new technologies are some of the issues that Australian retailers face. After recovering from the global economic crisis, Australia’s businesses are still confronted with a number of challenges to their operations. One of the key challenges facing retailers in Australia is the rising trend in online shopping, and especially gaining a competitive edge against foreign firms that are offering the same products at a lower price (Oakton 2017). According to the Australian Bureau of Statistics (2017), international retailers have 20% more advantage than domestic stores and enjoy an exemption of the Goods and Services Tax (GST) for items that are less than $1,000. Some domestic retailers have been in talks with the government to amend the legislation in order to reduce the disparity, but the outcome is uncertain. The solution is that businesses should adopt the new technologies and streamline their supply chain management operations. 

Examples of Advanced Technologies

Another challenge is the adoption of a lean supply chain. Australia still lags behind in the implementation of just-in-time practices (World Economic Forum 2011). The just-in-time concept is a growing trend in the supply chain management operations. Firms have sought to enhance efficiency in their operations by implementing just-in-time techniques. The approach has not been fully implemented in Australia. Among other challenges that are related to technology, Australia’s firms need to overcome them if they want to remain competitive in the global arena. So what are some of the technologies that apply to supply chain management? The next topic will explore some of the trending technologies in a bid to make business managers aware and how they can implement them. 

Blockchain technology is considered as a game changer in supply chain management. According to Popper and Lohr of the New York Times (2017, March 4), they described block chain as a key enabler of the efficient integration between parties in the global arena. IBM and WalMart have partnered to implement this technology which has been applied to track pork chops, shipping containers and footwear at an incredibly high speed and security that the current technologies do not offer (Handfield 2017). So what exactly is Blockchain technology? Blockchain technology simply means a method of bookkeeping that connects entries in such a way that one cannot easily modify them later (Blockchain Technologies 2016). It helps large groups of companies that are not related whatsoever, to keep their records of transactions in a more secure and reliable manner (Iansiti & Lakhani 2017). So what are the implications of blockchain technology in the supply chain?

According to Mitchell (2016), the implementation of blockchain technology will add value to the supply chain and eliminate redundant data maintenance activities in the supply chain. The technology enables users to access a wider and more universal sale or network that is accessible to any participant free of charge without membership fees (Mitchell 2016). In the shipping industry, for instance, it can reduce shipping delays due to the absence of paperwork which consumes a lot of time during container approvals. Blockchain technology helps in tracking all transactions in a secure and transparent manner. Imagine the opportunities it presents in the supply chain? The technology has the capability to document every single transaction and create a permanent history from the supplier to the manufacturer and all the way to the consumer. Loop (2017) notes that the technology enables easy recovery of stolen merchandise. Blockchain allows automatic verification of products’ authenticity after which it is activated in the system. Any stolen product along the supply chain can easily be traced through any particular transaction.   The adoption of this technology will indeed revolutionize the supply chain operations.

Have you ever imagined all objects on earth communicating with each other? This may sound weird to you; if that is so then, you have never heard about Internet of Things (IoT).  The IoT concept has different purposes in various industries. Sensing Enterprise (SE) is a concept that allows IoT to react to business stimuli that originate from the Internet. The fields have recently been subjects focus in businesses and evidence that such technologies can be used in the supply chain management exists.  By definition, Internet of Things refers to a network of objects which is well equipped with RFID chips and such like technologies to allow objects to communicate and interact with one another (Cortés, Boza, Pérez, & Cuenca 2015). It is a technology that is aimed at enhancing the forms of communication that currently exist. Currently, when we talk of Internet, we refer to a network tool that human beings access through devices. Communication is currently from human to human. Here comes IoT which would allow not only human to communicate through the Internet but also objects. The objects will be able to exchange information by themselves without human aid through the Internet. New forms of communications will, therefore, be created to include human-things and things-things (Tan, & Koo 2014).   Internet of Things is an evolution of the current Internet with the capability of collecting, analyzing, and distributing data that can be transformed into information and knowledge. One area in the supply chain management that will benefit from IoT is in-transit visibility (Shankar 2017). Since the logistics ecosystem comprises of many products and parts that are always in motion, an informed supply network is essential to track the whereabouts and specifications of a product. With the aid of GPS and RFID, IoT allows businesses to track the location and information about the product and sends the information all the way from the manufacturer to the consumer (Pettey 2015). The data obtained from the GPS and RFID technologies enables supply chain personnel to automate shipping and delivery by being able to determine the exact time a particular product may arrive. In addition to this, supply chain professionals can easily monitor vital parameters such as temperature control, which has a significant impact on the product quality in-transit.  

Additive manufacturing technologies, popularly known as 3D printing is whereby, materials are joined to make devices from 3D model data, by adding a layer on top of another layer (OPTOMEC 2017). Additive manufacturing is a technology that will revolutionize the 21^st century and the centuries to come. It has applications in various industries. Imagine you are in a remote place, then a particular component of your vehicle breaks down; you probably end up wondering where you can get a replacement. With Additive Manufacturing, this can be possible by just printing the component using the 3D technology.  The technology is already being used around the world and has changed the way companies design and manufacture their products. When correctly used, additive manufacturing can significantly save money and time.  The question is how this technology applies to supply chain.

Additive manufacturing will revolutionize the traditional way of manufacturing various products which involved cutting of objects and modelling the raw materials and forming the final product through a mold or die. 3D printing technology eliminates the necessity of having to manually assemble the expensive components to form a product. It provides freedom to change a product anytime anywhere and fast. It does not need highly skilled personnel to operate the machine since what you need to do is just pressing a machine and, voila, you get your product.   As a result, supply chain operations will see a significant impact.  Consider, for instance, where one would stock materials if production is to happen anywhere in the world, or how processes will be simplified if a component assembly is no longer necessary for manufacturing a product but the available raw materials can be changed into desired finished products.

Birtchnell et al. (2013) note that additive manufacturing enables product customization which has a direct impact on downstream supply chains management sections like production and distribution. The customization offers unique specifications to customers, and their high involvement in the manufacturing of the product from the design and production operations will further provide flexibility to react to changes in the end user market. Janssen et al. (2014) state that the implementation of 3D printing by setting up local 3D printing hubs will significantly reduce the need for global transportation which will be made possible by replacing the physical flow of objects with a simple transfer of digital files. Additive manufacturing or 3D printing will have a significant impact on inventory by changing inventory mix which would, in turn, have long-term effects on supply chains. A closer look at additive manufacturing will show that the technology will significantly reduce manufacturing waste and improve environment advantage. The traditional manufacturing practices involve replacement of parts physically which involves scrapping away of some excess products components. This is not the case with 3D printing. The technology provides an environmental advantage in that; it reduces material usage across the supply chains.    

3D printing allows the consolidation of parts into single components which enable the manufacturers to produce complex tooling sets, and thus; enabling firms to reduce supply chain complexity. This would transform the supply chain by making it more resilient against disruptions along the chains. AM or 3D printing will indeed change the global logistics since it replaces physical goods with digital files sharing. To make this more interesting, consider a customer who needs a particular low-demand service part who is in a hurry and cannot wait that long for all the processes of designing and fabrication to take place. If the dealer could just ‘print’ what the customer needs in just a matter of seconds on the spot, how much do you think the customer would have saved?

IBM (n.d.) defines cloud computing as the process of delivering on-demand computing resources through the Internet on the basis of pay-for-use.  This concept is rather old, and just in case you did not know, you are probably using cloud computing if you use the internet to send or receive emails, to stream videos online, or watch TV as well as storing and sharing files such as pictures and documents. Cloud computing is what makes all this possible. It is imperative to have a look at the activities in supply chain management that cloud computing can transform.

Forecasting and Planning: Cloud computing helps organizations to improve their service delivery by effectively coordinating the supply chains across their networks or partners who play a crucial role in demand-forecasting.  The cloud-based platforms can collect relevant information through the internet, and analyze the data that would enable accurate statistical demand forecasts for all the affected parties (Toka et al. 2013). This will eliminate the distortion of information across the supply chain. It will allow stakeholders to have accurate information about the actual demand volatility that they are supposed to meet.   In a cloud computing platform, a customer can generate demand and send it to the distributor who would then send the same to the public cloud, enabling all the relevant parties in the supply chain to see it.

Sourcing and Procurement: Sourcing involves acquiring, receiving and inspecting of materials and products coming from suppliers with the procurement processes in a bid to select the right vendor (Holger & Klaus 2011). Cloud-based platforms provide a database that contains a variety of data about various suppliers, thus helping companies that deal with several suppliers. As a result, cloud computing enables organizations to select vendors based on how they beat deadlines and satisfaction of all the specifications provided. The tools of cloud computing technology help organizations and suppliers to easily manage their contracts.

Other areas that cloud computing can be applied are logistics and service and spare parts management. It can be used in tracking operations and the management of parts in stores. The benefits of this technology are flexibility, visibility, cost-efficiency, scalability, and sustainability.  Looking at all the technologies discussed, it is apparent that their applications economic, social and environmental impact.

On the economic aspect, the application of these advanced technologies will lead to more profits and fast growth. It can be seen that all the technologies help in minimizing time and material wastes. This would, in turn, translate to more profits and growth of GDP across the globe. Information sharing in companies is likely to become easy and more efficient. This will lead to more productivity by employees. A happy employee means more productivity. Partners and all stakeholders in a business need connectivity in order to realize better performance. Computers will soon take most of the jobs that are done by humans. For instance, an attendant at the shipment areas will be irrelevant to count the number of containers or vehicles approaching; this would be replaced by the ‘Internet of Things.’ Everything that touches our daily lives, including clothes, vehicles, foods, among others, will be connected to the IoT web and thus, physical contact will not be necessary. Everything will be fast and efficient. Imagine the world where you do not even have to go to appear to a doctor for diagnosis, all you need to do is just switch your computer on and, voila, your virtual doctor tells you everything you need to know; that is the world we are heading to. Environmental wastes and pollution will significantly be minimized because most of the operations will be virtual, no need for papers. How about our social life? Yes, people will be more connected; it will be like, you have the entire population of the world just next to you. Is that a good thing? The answer can be either yes or no depending on individual’s perspective. I can say that people will be less social, physical meetings will be very minimal; people will spend more time with their electronic gadgets than with their peers, right from the workplace up to their homes. With that said, do you think it’s a good thing? 

Conclusion

Advanced technology will help organizations improve supply chain management processes. Efficiency, reliability, flexibility, visibility, cost-efficiency, scalability and sustainability are what the advanced technology can offer in all the operations in supply chain management. Application of advanced technology in supply chain helps companies outperform their competitors by enabling an effective and efficient flow of products and services to customers. Blockchain and IoT technologies enable businesses to access more precise and accurate information about transactions and products which help in preventing the supply of unwanted materials, helps in tracking of goods to prevent fraud, and timely delivery of goods and services. To successfully apply a new advanced technology, supply chain professionals should understand what kind of technology system best fits their needs. 

List of References

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Birtchnell, T., Urry, J., Cook, C., and Curry, A., 2013. Freight miles: the impact of 3D printing on transport and society

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Cortés, B., Boza, A., Pérez, D. and Cuenca, L., 2015. Internet of Things Applications on Supply Chain Management. World Academy of Science, Engineering and Technology, International Journal of Computer, Electrical, Automation, Control and Information Engineering, 9(12), pp.2449-2454.

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Loop, P., 2017. Blockchain: The Next Evolution of Supply Chains [Online]. Available at: https://www.industryweek.com/supply-chain/blockchain-next-evolution-supply-chains

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Toka, A., Aivazidou, E., Arvanitopoulos-Darginis, K., and Anoniou, A., 2013. Cloud Computing in Supply Chain Management: An Overview [Online]. Available at: https://www.researchgate.net/publication/260510400_Cloud_Computing_in_Supply_Chain_Management_An_Overview

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