There is much more to the supply chain than simply getting the product delivered. In today?s ?on demand? world, speed of delivery and tracking the product from manufacturer to end-user, whilst knowing exactly how much of what is where, is essential to completing the cycle of any business transaction. It is generally agreed that the answer to managing the supply chain effectively today lies in the use of technology.

Says Shawn Jensen, GM Vertical Solutions at Internet Solutions (IS): ?Proof of delivery (POD) has been labelled as one of the most troublesome issues facing the supply chain. For many years, locally and abroad, the concept of Electronic POD has been touted as the hottest solution for logistics companies, with ROIs which would make any executive take serious notice.

Jensen notes that, based on client feedback, between 60 percent and 80 percent savings in call reduction has already been demonstrated by implementing a POD solution. ?All of this without changing the client?s business process!

?Why then the delay in adoption? Electronic proof of delivery exists today, and is easily the most effective way to transform a supply chain by using technology with real and tangible results evident in the first months of deployment.?

Jensen says that a barrier to adoption of this solution, even with substantial ROIs, has always been the capital expense required to purchase the appropriate hardware and software. Along with this, traditionally, came the complexity of sorting out all the required solution components, from network connectivity, infrastructure to the physical management of hundreds of devices in the field.

The cost of new technologies and their implementation is clearly still a major issue for many within the supply chain.

In the view of Greg Bogiages, MD of Cortel Business Solutions, the biggest concern these days is that companies do not understand the cost of supply chain. ?Gone are the days of companies just knowing what a product costs. They now want and need to know the costs involved in the entire supply chain process.?

He says that online analytical processing (OLAP) is what companies need to invest in to ensure that they see the bigger picture, so as to ultimately meet customers? needs. They should not just focus on cutting costs. Bogiages says it is vital to be able to do modelling or ?what if? predictions. ?What if a transporting company changes its delivery trucks to trucks with less fuel consumption? The costs are reduced, and the entire supply chain benefits, right up to the customer.?

Pieter Smits, MD, GlobalTrack (a global supply chain services company), believes that companies can gain great value in reducing monitoring cost and risk, and increase efficiency and profits by getting live information on valuable assets via the Internet.

Says Smits: ?Organizations are demanding integration of all systems in order to view the status of the whole operation from one centralized point of reference. Traditional systems tend to focus on one software product only, and lack the expertise and/or knowledge to adapt the ever-changing and more demanding market.?

More IT integration needed

According to Smits there has not been sufficient IT integration within the transport industry. He says different computer systems have been put in place to make different administrative, planning and management jobs easier. ?Since the systems have been installed, a lot of organizations find them inappropriate or not user-friendly -- mostly because the systems are all different and not linked together.?

Smits notes that users do not want to utilize three different databases to access the same information. ?Integration of systems and processes will be the keyword of 2005; making life easier for everybody while reducing costs,? he says.

Currently barcoding solutions are commonly used within the supply chain process, and, according to Andrew Robinson, regional manager for barcoding and printer company, Zebra Technologies, ?barcoding is a mission-critical IT function.?

?Despite the increasing demand for communication between barcoding systems and legacy systems to provide improved data management, data integrity, and operational efficiency, integration of these systems has been slow to develop.

Because of the delayed adoption of barcode printers in corporate networks, barcode systems have come to be viewed as manufacturing rather than IT equipment, and network administrators have generally seen barcode printing as outside their scope of responsibility,? he says. This is, however, changing and forcing administrators to either become familiar with new software or adapting existing software to barcode printers on the enterprise network, he says.

Another very important aspect of the supply chain is that of asset management. Says Adriaan Scheeres, CEO of asset performance management specialist Pragma Holdings: ?Efficiency in asset management is non-negotiable. The supply chain is critically impacted if components of the business are not operating optimally.

?Asset management optimizes the entire supply chain and its processes. As much as 60 percent of the manufacturing planning process can be influenced by some physical asset breaking down, leading to unplanned costs, delays and bottlenecks in the supply chain. Unless assets are allowed to perform at optimal level at all times to keep processing cycles alive, businesses cannot expect to deliver profitably,? notes Scheeres.

What is the next best thing in supply chain management?

According to the industry the future of optimized supply chain management lies in radio frequency identification (RFID) technology.

Most agree that there are numerous benefits, including cost reductions, increased revenues, counterfeit product shielding, theft and fraud prevention, and gaining competitive advantage. The biggest concern, however, still remains the cost of the implementation from a hardware perspective.

The cost of software and applications, as well as the cost of integrating it within legacy systems does not seem to be the problem, but the cost of the RFID tags themselves, as well as the scanners, is proving to be the hurdle for adoption.

Although there are two different tags -- the Active tag, which costs US$70, and which has more built-in functionality, and the Passive tag, which costs from $5 to $0.50, but has less functionality -- the cost remains high, if one takes into account the vast numbers of tags that major retailers and manufacturers would need.

According to Sadiq Malik, director for business development at wireless and mobile integrator, BCT Global, RFID is today?s hottest technology, but he notes that it should be looked at as more business process re-engineering (BPR) than technology, with the key objectives of reducing cost and increasing revenue.

He claims that the new excitement in RFID is about long-range, passive RFID tags, which may actually achieve the needed pricing and performance levels for the maximum ROI. 

However, Malik adds that, as with all new technologies, one should understand the capabilities of RFID, and evaluate how it can be useful to operations today.

He says: ?As RFID continues to evolve, many companies are setting more realistic expectations for the technology. The key to a successful implementation is to determine the most appropriate places to adopt the technology.?