In search of a sustainable SCM

It is prima facie that Supply Chain management (SCM) is simply moving a product or service from supplier to customer. However with the booming technology, supply has an important role to play in the efficient logistics system. In this issue, CARGOTALK foc

Mansingh Jaswal, Director & CEO, Genex Logistics

Today’s supply chain needs to deal with continuous volatility and that does not mean risk only but also opportunity when a competitor is not being able to deliver the same. In this process of evolution, the pace of change has increased manifold and technology has been at the helm of affairs, either to create the pace or manage it. Shippers are under continuous pressure to reduce supply chain costs as part of larger organisational goals.

Largely the cost reduction has to come from two sources, either from simple incremental improvement in the ongoing process or from business remodelling itself.

Most of the activities of an end-to-end supply chain happen outside the four walls of a warehouse and companies are largely looking at wireless solutions.

However, the fact that the pace of change in technology is almost catching up with the expectations of the end consumer or the development in technology is raising the expectations of consumers. A lot of integration and automation upgrades still need to happen among shippers and 3PL providers to incorporate the emerging technology. E-commerce is a typical example of the role of logistics in business model creation. This is also an example of how technologies are deployed to bridge the gap between customer expectations and delivery. It does not end here, rather this has raised the expectations of consumers, resulting in the ongoing spiral that technology is creating.

Vikas Anand, Managing Director, DHL Supply Chain

India

IT is now perceived as a key enabler for all logistics offerings with companies relying heavily on IT automated solutions to ensure smooth logistics operations, which revolve mainly around WMS, TMS, EDI integration and visibility tools. India is a market with enormous growth potential for 3PL activity for those who can bring in value-for-money services of modern standards. While it is true that this industry is still in its nascent stage in India, things have picked up very rapidly in the recent past with more and more manufacturers realising the need for credible and experienced 3PL providers.

Our infrastructure needs to be developed and while India is increasing outlays on roads and ports along with more tangible economic reforms, these infrastructure development projects have a long gestation period. We welcome the change and infrastructure upgrades that are taking place as these will benefit and facilitate our services to our clients.

In India, logistics costs are very high compared to international standards owing to its underdeveloped infrastructure. Steps are being taken to improve the infrastructure, but the pace seems slower than the economic growth. Acceleration of road network improvement and expansion would mean huge savings on fuel, greener environment, enhanced safety and better turnaround time for customers.

Jitender Panjwani , Head – Supply Chain, India

Operations, Micromax

There is a need to develop infrastructure to improve the Supply Chain Management function and a better reach to desired destinations.

Roads are congested and of poor quality: Lane capacity is low; national highways are two lanes or less and a quarter of all India's highways are congested. Many roads are of poor quality and maintenance remains underfunded. More or less one-third of maintenance needs are met and this leads to the deterioration of roads and high transport costs for users.

Railways are facing severe capacity constraints: All the country’s high-density rail corridors face severe capacity constraints. Freight transportation costs by rail are much higher than in most countries as freight tariffs in India have been kept high to subsidise passenger traffic.

There has to be an immediate focus on trade lanes; on road connections and where road transportation is taking place. An immediate improvement in current infrastructure is required with safety and security for goods. Special cargo trains and unique material handling hubs with special features to cater volumes with minimal mishandling is the need of the hour for effective and responsive supply chain. Major improvements, such as good physical connectivity in the sector, are required to witness a rise in demand.

SA Mohan, CEO, Maini Materials Movement

The supply chain in India is largely inefficient, causing huge losses and stock-outs appertaining to the presence of intermediaries, infrastructural inadequacy and complicated legislation. 13 per cent of India’s GDP is spent on logistics, which is an alarming fact. Proliferation of challenges in areas of reverse logistics, environmental sustainability, information technology and overall supply chain integration are further evolving the strategic roles and responsibilities of warehousing and material handling solutions in the growing field of intralogistics.

Amalgamating new technology to increase efficiency of information exchanged whether through automation, Warehouse Management System (WMS), lean designs and vertical expansion, for example, high rise warehousing and distribution centres is not a nascent concept anymore. Today, it is observed to be a prerequisite for gaining competitive advantage and can help significantly increase customer service and reduce costs.

The challenge for supply chain professionals lies in managing not only long-term growth but also in being equally responsive to short-term volatility, due to ever increasing consumer segments, greater number of products and emergence of new channels.

Statistical capabilities, enhanced by technology, will enable us to take a leap towards smart supply chains and foster innovation adoption.