SUPPLY CHAIN STRATEGY

Ingredients of a Sustainable Supply Chain Strategy

From our countless discussions with hands-on practitioners, industry experts, trade association representatives, academics, and politicians, which we conducted in dedicated workshops, via the bestLog online platform and in case study interviews in the course of the bestLog project, we have identified the distinctive ingredients of a sustainable supply chain strategy defined in the previous section. The following gives an overview of these ingredients.

2.3.1 Ingredient I: A Strategic and Holistic Approach

The bestLog research shows clearly that todays sustainable practices, balancing environmental, economical, and social goals: l Are extremely varied and arbitrary l In large corporations, are often implemented as island solutions by individual business units and often with a regional or specific customer scope l Often lead to solutions which seem to be sustainable at first glance if you look only at the particular company, but not for the total supply chain, where suppliers or service providers are set unbalanced objectives. These failings, we have found, are due to the absence of: l Specific sustainability goals in the corporate vision and strategy l Specific sustainability goals in the supply chain strategy l End-to-end responsibility of responsible logistics and supply chain managers l Implementation experience and shared knowledge and l Top management commitment Logistics and supply chain managers are often mainly focused on measures that appear to lie within their natural scope of responsibility. They have often implemented environmental and social policies as a kind of aside; often without integrating them with the economic dimension. Sometimes to a greater and sometimes to a lesser degree, they have not really viewed or addressed economic, environmental or social responsibility issues holistically.

Ingredient II: Recognizing and Assessing Current and Future Trends

Over-arching macroeconomic and social trends,9 globalisation and increasing competition, longer and more fragmented supply chains, and increasing stakeholder and shareholder demands, all affect the complexity and dynamics of supply chains. More than ever, todays supply chain managers are confronted with dynamic and discontinuous change (e.g. oil prices), and the more dynamic they are, the harder trends are to forecast. Longer and increasingly fragmented value chains, together with totally new dimensions of objectives (e.g. CO2 emissions reduction), extend the responsibilities and agendas of todays supply chain managers. Future-oriented sustainable strategies must be able to adapt to nascent trends as early as possible, and logistics goals must be geared towards these trends. This is key to ensuring the long-term success of a company. The challenges for supply chain managers in this context are (a) to identify the trends which are relevant to their complete supply chain and (b) to assess and evaluate their potential negative and positive impacts.

Ingredient III: Implementation of Economic, Environmental, and Social Objectives

Implementation integrating objectives into operations plays an important role in the adaptation of supply chains to new supply chain objectives such as environmental or social goals. Implementation is, put simply, the translation of strategic, partly generic, long-term goals into operational, specific, short-term goals. One result of an implementation process is usually a group of interrelated KPIs, also called a KPI system. Such a KPI system is a kind of quantitative tool used to implement strategic goals into company operations. Of course there are, besides a quantitative tool, also pretty important qualitative aspects influencing a strategy implementation, e.g. good communication, high motivation, the right awareness, etc. We will resume these aspects in the next section. The challenge for supply chain managers is to break down the strategic goals into the right KPIs and to define the specific target figures for a given reporting period. The challenge in selecting the right KPIs is, of course, to select those KPIs which measure and control the right operational processes. Another challenge is that different operational goals may be complementary, or may conflict with each other; a KPI system must take potential trade-offs into account. Environmental and social goals in particular are in most cases new to many operations, and need to be integrated into their existing KPI system. One recent study on trends and strategies in logistics showed that 43%of large companies and only 26%of SMEs had defined concrete environmental and resource protection goals among their logistics operations targets.10 One reason is a lack of knowledge regarding the measurement and the assessment of environmental and social impact KPIs.

4 Cash Flow Matters: Link Social and Ecologic Goals with Financial Figures
A green strategy or a social strategy is not a strategy for sustainability. True sustainability must give equal weight to the economic dimension. Sustainable supply chain practices must be financed and provide pay back within a reasonable time span. In bestLog we have seen logistics practices which were abandoned during the economic crisis in 2008 due to their economic disadvantages. An example was Mercadonas intermodal transport practice in Spain, which caused clear negative cash flow, having not reached critical transport mass. The challenge is to assess the economic, in particular financial, aspect of a practice. Best practice companies are capable of this. They have extended their supply chain KPI systems to include social and environmental measures and can link this whole operational KPI system with their financial measurement systems. The Sustainable Supply Chain (SSC-)Scorecard in Sect. 2.4 will provide a generic template to apply this approach in your company.

2.3.5 Ingredient IV: Balancing Economic, Environmental, and Social Objectives

Part I has shown the general relevance and importance of balancing social, environmental and economic objectives in companies sustainable development. The central challenge here is that balancing economic, environmental and social objectives requires first of all an understanding of the conflicting and complementary relationships between them. The strategic challenge is than to establish realistic and balanced targets in different operations in all three dimensions. And each of the three dimensions must be aligned to the overall corporate strategic goals and vision, regardless of possible specific trade-offs.

Strategic SSC-Program: Re-design Supply chain managers should follow the Re-design program to obtain the benefit and competitive value of the long term and cardinal improvement of effectiveness and early prevention of risk. This program is mainly driven by additional supply chain and logistics costs resulting from rapidly increasing resource prices and regulatory costs which affect a companys competitive position. The actions around Re -design aim to change existing structures and processes. The scope of activities covers the whole supply chain. Hence, a collaborative approach is one key success factor. The decision making processes needs to be quantified as much as possible, in order to draw up and assess several scenarios, since re-design actions are mostly linked to high costs and investments, and are often irreversible. Some examples of program actions, some of them described in the bestLog case studies include: l Regionalization of procurement and production structures l Hub strategies in the distribution network l Closed-loop supply chain management l Re-assessment and substitution of suppliers and logistics service providers l Business Process Reengineering (BPR) Strategic SSC-Program: Innovation Supply chain managers should follow the Innovation program to obtain the benefit and competitive value of differentiation. This program is mainly driven by external stakeholders: customers, consumers, NGOs and suppliers who demand new solutions, products, and services. The actions around Innovation aim to change existing business models, to break existing mindsets in the supply chain, and to achieve a sustainable 17 image, which, in the end, will increase the credibility of a company. The scope of activities is mainly intra-organisational, e.g. between R&D, SCM, manufacturing, and sales as well as inter-organisational in the end-to-end supply chain. Hence, communication and awareness are key success factors; top management commitment throughout the key supply chain players is a must. Some examples of program actions, some described in the bestLog case studies, include: l Innovation management for new products and supply chain services l Price differentiation for premium, sustainable supply chain services and products l Design for logistics (product and packaging) l Training and education l Incentive systems for employees and partners l Profit-sharing models for supplier and logistics service provider l Remanufacturing l Knowledge and best practice platforms l Carbon footprint labels on products and services Strategic SSC-Program: Progression Supply chain managers should follow the Progression strategy to obtain the benefit and competitive value ofdifferentiation, first mover advantage, and establishing market entry barriers. The main drivers in the relevant industry, and even society as a whole are: a lack of standards, of knowledge, and of regulations, highly developed corporate social responsibility, and a lack of common market direction. The actions around Progression do not have a direct, measurable payback for a given time period. The benefits are more long-term and qualitative, and go along with reputation and image. The reach of activities is wide spread mainly found in the relevant sector, at governmental institutions, at associations, and in different countries. Hence, a focused approach with concrete milestones is a key success factors, top-management commitment along the key supply chain players is a must. Some examples of actions, some described in the bestLog case studies, include: l Investing money and time in establishing new standards in the market, e.g. a CO2 emission measurement standard in the transport sector. l Funding research institutions and research projects and surveys.

Funding of relevant NGOs Active involvement in associations l Establishing knowledge exchange platforms l Communication, discussion, and consulting with politics and regulation
l l

Supply Chain Strategies: Time to Refresh?

Conventional thinking on supply chain strategies has been quite restricted to a few major concepts. My objective in presenting this series is to review these concepts, critique where they fall short, and finally, present an alternate way to think of supply chain strategies that will actually help you build capabilities and design effective supply chains. Designed, ground up for creating and sustaining competitive advantages rather than simply filling up feature/functionality gaps to automate your operations. There is a reasonable bulk of literature available on supply chain strategies. Most of the literature surveyed presents similar concepts by varying names in different contexts. They tend to typify the supply chains as being one of four types: lean, agile, speculation, or postponement-oriented. Hau Lee of Stanford identifies four types as Efficient, Risk Hedging, Responsive, and Agile, which are quite similar to the earlier characterizations but with subtle differences. Similar themes are repeated but all of them suffer from the same problem: They are all so generic that they frequently drive the business strategy rather than being driven by it. The level of abstraction precludes the possibility of going into specific details, which are useful in designing the business capabilities for a real-life supply chain. Being lean, for example, is viewed as simply a cost-reduction strategy and will be just as applicable to supply chains as it will be to human resource management or any other business function in a corporation. With that amount of directive, do these concepts really qualify as supply chain strategy? In the next few days, I will review the following four basic concepts that appear time and again as supply chain strategies. I will argue why they fall short of being of strategic value and what alternatives exist. Till then, the briefs below will have to suffice: Lean The supply chain strategy concept that revolves singularly around cost-reduction abilities of a well-designed and well-run supply chain. (Why would you ever build a supply chain that is not optimized for cost?). Agile The supply chain strategy with a singular focus on creating responsiveness. (Is there such a thing as an unresponsive, yet effective supply chain?). Postponement The strategy concept based on the idea that supply allocations or creation of finished goods should be postponed as long as possible towards the time of actual demand. (Great concept, but is it really applicable to you when you are in build-to-stock business model for a commodity item? What if you were manufacturing staples?). Speculation The strategy based on the idea of leveraging economies of scale to reduce the incremental cost of supplies for addressing incremental demand. (Once again, great concept, but what if your business model is not suited to a build-to-stock scenario? What if your businesss value proposition lies in providing custom-tailored jackets?) Next few weeks, I will expand on each one of them and finally conclude with a supply chain design paradigm that will allow you to actually build an effective supply chain rather than chasing the phantom strategy concepts that are too abstract to be useful in a real-life scenario! Keep tuned. Looking for an alternate way to design effective supply chains? The answer does not lie in adopting theories in the hope of finding the right answer, but to build your own supply chain capabilities driven by

your business strategy. To find this new approach to build effective supply chains, understand the supply chain sphere of influence, find out what drives your supply chain and the new design imperative to build supply chain capabilities that directly support your business strategies.

Supply Chain Management (SCM) can be best described as the natural extension of the downsizing (right-sizing) and re-engineering performed by the organization(s) in the past. Downsizing and re-engineering transformed the enterprises into lean and mean competitive units, by cost cutting and process simplifications. These operations (of downsizing and reengineering) involved the optimization (in terms of the number of persons involved, the time taken, the complexity of the work etc.) of business units (functional and/or administrative domains) over which the organizations had full control. These strategies did lead to increased productivity and profitability of the organizations but as the benefits of these levelled off, it was realized that the approach to the way organizations work needed to be changed. The above changes were a by-product of the isolationist (closed system) world picture of the enterprises involved in the full value chain; with organizations (the system) trying to survive in an hostile environment; assuming that all other participants in the value chain were adversaries with whom the organization must compete, even though the operations performed by the separate organizations may be supplementary in nature rather than complementary. The realization that this world picture was an impediment to the growth of organizations prompted the enterprises to start seeking strategic alliances with other organizations. The formation of these alliances required a basis (a common ground) which would be acceptable to each and every partner in the alliance. This common basis is/was supplied by the participation of the organizations in the value chain (the demand-supply chain). The participants in the chain, suppliers, sub-contract suppliers, inhouse product processes, transportation, distribution, warehouses, and the end customer, generally, perform mutually exclusive tasks and thus do not compete directly with each other.

SCM Framework
A framework to understand the various issues involved in SCM is provided by the pyramid structure for the SCM paradigm (fig. 4) The pyramid allows issues to be analysed on four levels: Strategic : On the strategic, level it is important to know how SCM can contribute to the enterprises basic value proposition to the customers? Important questions that are addressed at this level include : What are the basic and distinctive service needs of the customers? What can SCM do to meet these needs? Can the SCM capabilities be used to provide unique services to the customers? etc. Structural : After the strategic issues are dealt with, the next level question(s) that should be asked are : Should the organization market directly or should it use distributors or other intermediaries to reach the customers? What should the SCM network look like? What products should be sourced from which manufacturing locations? How many warehouses should the company have and where should the be located? What is the mission of each facility (full stocking, fast moving items only, cross-docking etc.)? etc. Functional : This is the level where operational details are decided upon. Functional excellence requires that the optimal operating practices for transportation management, warehouse operations, and materials management (which includes forecasting, inventory management, production scheduling, and purchasing) are designed. These strategies should keep in view the trade-offs that may need to be made for the overall efficiency of the system. Achieving functional excellence also entails development of a process-oriented perspective on replenishment and order fulfillment so that all activities involved in these functions can be well integrated. Implementation : Without successful implementation, the development of SCM strategies and plans is meaningless. Of particular importance are the organizational and information

systems issues. Organizational issues centers on the overall structure, individual roles and responsibilities, and measurement systems needed to build an integrated operation. Information systems are enablers for supply chain management operations and therefore must be carefully designed to support the SCM strategy. Supply chain managers must consider their information needs relative to decision support tools, application softwares, data capture, and the systems overall structure. It is important to note that the decisions made within the SCM strategy pyramid are interdependent. That is, it must be understood what capabilities and limitations affect the functional and implementation decisions and consider those factors while developing a supply chain management strategy and structure. The SCM models used in practice lie in a continuum between two extreme models : on one end of the spectrum lies the vertically integrated supply chain model in which the organization has direct control over each and every component of the supply chain, while on the other end of the spectrum lies the horizontally diversified supply chain model (ideally) in which the number of participant is as large as the number of distinct parts of the supply chain. In an vertically integrated supply chain system, the organization can control every component of the chain and can make various changes to the system to optimize the chain very easily. But in a horizontally diversified supply chain the tendency will be to optimize only the functions that the organization is involved in, thus conscious efforts must be made by the various participants in the supply chain for the integration of their respective components in the supply chain. If an organization can be identified as the major/dominant partner in the supply chain, then this organization has to take an initiative in seeking the co-operation of the other participants in the supply chain.

The type and structure of the supply chain that is established depends on many factors, some of the major factors are : Geographical : If the supply chain is stretched across the globe then it may not be possible to incorporate some of the principles of lean production like JIT delivery, flexible manufacturing, and co-ordination among suppliers and customers. It can lead to uncertain transportation schedules, unpredictable lead time and may need larger inventory carriage. Cultural : The difference in the culture of the participants in the chain (the difference can be due to geographical factors or corporate practices) can lead to friction and distrust. This may hamper the development of close ties. Government Legislation : The laws of the country may prohibit the sharing of information about some facet of the supply chain and thus, may lead to a restrictive participation by one or more participant in the supply chain.

Fig. -5 : Spectrum of alliances in the supply chain. Time : Just as among individuals, organizations require time before trust can be built up. The first phase in any relationship is manifest as confrontation, that essentially means that participants in the chain try to win at the cost of other participants. And, the last phase is exemplified by total trust and working together of organizations. The information sharing behaviour in the first phase is almost zero, while in the integrated relationship the information sharing is mutual and free about the common concerns. In between the two phases lie a continuum of phases (see fig. 5).

Design of Multiple Criteria DSS for Transportation and Distribution

Transportation and distribution management is one of the major component of SCM. The success or failure of a supply chain depends, to a large extent, on the success of the distribution channels. The solution to the problem of transportation and distribution in a supply chain is usually done through the use of some variant of the classical transportation problem : This model is usually solved by special techniques (called the transportation problem techniques) which are based on the simplex method. The model can be made more general by relaxing the equality constraint 1c. But even with these extensions the present problem can not be considered, as only the goal of cost minimization is considered in the classical model. In any real life transportation and distribution problem, the number of goals to be achieved (the number of criterion/objective) is more than one. The presence of multiple goals imply that the "classical" transportation model can not be utilized for the solution of the present problem. Owing to the presence of multiple goals the methodology to be used is Multiple-Criteria Decision Making (MCDM) problem. In the following part of this section we detail a MCDM model for the use in the design of a DSS for the transportation and distribution plan generation of a public sector enterprise.

What is supply chain strategy:

Supply chain strategy - sounds like a good thing, doesn't it? But what really defines a supply chain strategy? Does your company have one? Does it need one? In 10 years, I've written about almost every subject possible, but I do not believe ever about supply chain strategy. I've come close to doing so a couple of times, but something else always got in t he way. The reality is the subject has not been written about much by anybody in the supply chain at a detailed level. I was reminded of my omission when I saw presentation at the Material Handling and Logistics conference in early September by Dr. Paul Dittmann, a former supply chain industry executive (Whirlpool) who now leads the Global Supply Chain Forum at the University of Tennessee. Supply chain strategy - sounds like a good thing, doesn't it? But what really defines a supply chain strategy? Does your company have one? Does it need one? In 10 years, I've written about almost every subject possible, but I do not believe ever about supply chain strategy. I've come close to doing so a couple of times, but something else always got in t he way. The reality is the subject has not been written about much by anybody in the supply chain at a detailed level. I was reminded of my omission when I saw presentation at the Material Handling and Logistics conference in early September by Dr. Paul Dittmann, a former supply chain industry executive (Whirlpool) who now leads the Global Supply Chain Forum at the University of Tennessee. Gilmore Says:

It was based on his new book "Supply Chain A supply chain strategy Transformation," importantly subinvolves adding a new rudder, titled"Building and Executing an with a captain and a crew that Integrated Supply Chain Strategy." know exactly how to get to their destination, but with a plan that He said there that not long ago, he asked has some resiliency built-in for members of the Forum - mostly large, wellthe inevitable storms the ship known firms - if their companies had supply will encounter along the way. chain strategies. To Dittmann, a supply chain strategy is defined as a formal written plan that details what actions the organization is What Do You Say? going to take over a multi-year horizon. Click Here to Send Us Your Comments Among Forum members, something like 18% had such a strategy. That seemed surprisingly low, Dittmann thought, so they conducted a survey among a larger group of companies. In that research, only about 15% of companies had a formal supply chain strategy. That may seem low to some but not to me. I wonder how many of the "strategies" among the companies claiming to have one would really pass muster upon a review. Click Here to See Reader Feedback

I have rarely seen a company with multi-year supply chain strategy, with one major exception. That is for companies that have embarked on a major supply chain transformation, especially if that transformation involves significant changes to the physical network. In recent years, that would include companies such as Home Depot, Hershey Foods, Kimberly-Clark, and many more. In those situations, which generally involve big capital expenditures and expenses for closing facilities, promises to Wall Street about cost reduction expectations when the transformation is complete, etc., then of course a written, multi-year strategy is needed. But is that really a strategy - or more like a project plan? A little of both. So, if you are not preparing for such a major transformation, do you need a supply chain strategy? That is really the question. A lot of things get confused as being strategies when they are something else a goals and objective document, for example. Goals and objectives likely are a necessary part of a strategy, but they are not a strategy by themselves.

I met an executive of a then fast growing women's apparel chain in about 2007, where he related to me what I think is a not unusual scenario: the chain had been growing so fast for many years, its stock price soaring over that period as well, that the job of the supply chain was really just to support that growth. Cost were important, but not as important as ensuring goods were on the shelf, and that new stores opened on schedule at a breakneck pace. Now, however, growth was inevitably slowing - what was the supply chain's mission now, and how should it get there? "We need a supply chain strategy," he said. Could I provide any help? I offered a few thoughts then and there, and we later exchanged a couple of emails, but I never really heard how that exercise turned out. Well, I wish I had Dittmann's new book to recommend then, because it provides a prescriptive model relative to how to build a supply chain strategy a company like that apparel retailer could easily follow. And like most things in business, that strategy should start with the customer, Dittmann says. A supply chain strategy - by definition a forward-looking document - should anticipate changing customer needs and define how the supply chain is going to evolve to meet those new requirements. That is in fact an exercise that Walgreens has recently gone through under the relatively new supply chain leadership of Reuben Slone, who worked with Dittmann at Whirlpool and has co-written books and articles with him. A forward-looking view of Walgreens' customer needs identified 11 new supply chain capabilities that would be required over the next few years. That in turn resulted in 25 separate projects to upgrade Walgreens' supply chain to achieve those capabilities. (Interestingly, at last Spring's WERC conference, Kathleen Shafer, director of supply chain transformation at Walgreens' rival CVS, gave an interesting presentation on how it was using a very similar process to upgrade its supply chain. Not sure if that is pure coincidence or not.) So, back to the question of whether we all need a documented supply chain strategy: Do Finance, Marketing, HR, etc. all have such strategies? I don't think so. IT often does, however, because technology changes and initiatives often play out over several years, with big CapEx dollars involved and major decisions about direction that need to be formalized.

But I think supply chain is different than most other functions. First, in physical product companies, supply chain often accounts for 60-80% of total costs, a huge number that therefore may be deserving of more detailed, multi-year planning. Second, supply chain generally operates as a services organization for the rest of the company. A strategy document can help the company's functions and executives to buy-into and thus support those supply chain strategies. An easy example would be plans to roll-out robust S&OP capabilities across the globe over a multi-year span. With those two thoughts, it also seems to me that if a company as a whole has a formal, multi-year strategy document, then it makes perfect sense the supply chain have one that mirrors the corporate plan. The strategic document can be the key tool that helps keep the supply aligned with the business. In his book, Dittmann lays out a nine-step plan for building a supply chain strategy. 1. Start with customers' current and future needs (as discussed above) 2. Assess current supply chain capabilities relative to best in class 3. Evaluate supply chain "game changers" (what megatrends will impact customers and the supply chain?) 4. Analyze the competition (something too few do for sure) 5. Survey technology - what is new or coming out there? 6. Deal with supply chain risk - risk management needs to be part of the strategy document 7. Develop new supply chain capability requirements and create a plan to get there 8. Evaluate current supply chain organizational structure, people, and metrics 9. Develop a business case and get buy-in Obviously, there is a lot more to it than just knowing those nine steps, and the book takes the reader through each of these steps in detail a chapter at a time. I was remiss for not tackling the strategy question for so long, and there is a lot more to say, so look for a part 2 on this soon - maybe with some of your comments. "I often see companies without a supply chain strategy chasing the latest hot trend or flavor of the month, Dittmann writes early on in the book. "Like a ship without a rudder, it sees any wind as favorable." A supply chain strategy involves adding a new rudder, with a captain and a crew that know exactly how to get to their destination, but with a plan that has some resiliency built-in for the inevitable storms the ship will encounter along

the way.

IT in SCH
the supporting information technology (IT) infrastructure that makes such integration possible. While information technology is needed to handle routine transactions in an efficient manner, it can also play the a critical role in facilitating the timely sharing of planning, production and purchasing information; capturing and analyzing production, distribution and sales data at new levels of detail and complexity. Information technology provides an integrating tools that makes it possible to convert data into meaningful pictures of business processes, markets and consumers that are needed to feed company strategies in order to develop competitive advantage.

On the administrative side, such elements as flow path economics, which help organizations understand the real drivers of costs, and new performance and measurement standards that align functions in accordance with total process goals that are critical to achieving integration Information Technology and SCM
Information technology (IT) includes a set of powerful tools that can lead to the failure or success of a supply chain process. With the development of information systems (IS) and information technologies the use of information sharing and decision making is growing at a very fast pace. IT solutions are no longer likely to provide strategic advantage, but imply the business basics. The competitive advantage for organization(s) originates from development of creative information technology strategies and implementing them. ISs enable existing strategies to be realized, Information flows provide the linkage that allows the supply chain to operate efficiently. Technologies like internet, intranet, extranets and groupwares[20] facilitate the sharing of information using (distributed) common databases (with access control to the database for

checking unauthorized access). These allows sharing the information not just within the functional divisions of an enterprise but upstream and downstream the supply chain. Electronic Data Interchange (EDI) can be used to place orders, inventory database can be shared between the manufacturer and the supplies for efficient implementation of JIT inventory; for vendor managed inventory (VMI) this sharing is a must. The internet and EDI can be used by the customer to monitor the status of the order placed, request changes in the order and viceversa, they may be used to inform the customers about the status of their order, besides being used for billing etc. The internet and EDI can be used not only for information sharing/exchange but may also be used for marketing of services, products (especially software) and advertisement etc. The internet is becoming a medium of choice for product marketing, delivery, billing and customer support. The above was the description of the technology available, below is the description of the supply chain management tools. These tools include supply chain configuration tools (for strategic decision making by determining the number, capacity requirements besides location of facilities etc.); demand planning tools to assist management in understanding the key drivers of demand using sophisticated analytical tools and with provision for interfacing with external data. Supply - planning tools to assist management with decisions such as which products to make, how to make them, what order to make them in and where to source materials from? These tools use interactive production planning, Gantt Charts and simulation and also incorporate advanced constraints such as capacity utilization, customer priority and due dates. Transportation and distribution planning and management tools to assist in the planning of how much to move- which item(s) - where? Using which mode of transportation?, support, carrier preference structure incorporation, consolidation and back-haul opportunity identification; load creation and sequencing, vehicle-scheduling and utilization optimization, operation within a warehouse, like order allocation, receiving, radio frequency/hand held scanning inventory

control (cycle counting, aging, lot control, expiry data tracking etc. And lastly, Enterprise Resource Planning (ERP) software; which provide the transactional data handling support. ERP grew out of MRP - I and MRP - II by the addition of the more functional domain modules. Generally ERPs provide tools for the management of the operational aspects of the supply chain management with a few additional decision support tools. But more and more DSS developers are providing interfacing/integration capabilities with ERP software for advanced tools of decision making support.