Supply-Chain Coordination Critical for E-Business

Just attaching a Web site to your enterprise resource planning (ERP) system and using the Internet to automate sales transactions isn't enough to really succeed at being an e-business.

That was the message from users and keynote speakers Monday at the Planet 2000 conference here sponsored by supply-chain and online-marketplace software vendor I2 Technologies Inc. To truly take advantage of the Web, they said, companies have to be able to share important business data and coordinate operations with their suppliers and customers in real time.

For example, Toyota Motor Sales USA is actively working to develop direct Web-based connections to its auto dealers and its supply chain in an attempt to achieve greater efficiency and profitability, said Yoshimi Inaba, the company's president and CEO.

Inaba, who was one of the featured speakers at Planet 2000 Monday, said the automaker's U.S. subsidiary also plans to install Internet-related technologies such as wireless communications setups and end-user Web portals throughout its operations.

Included in the projects under way at Toyota is one that should let the company's massive replacement-parts business communicate more quickly with suppliers, Inaba said. That will pave the way for dynamic inventory planning and improved parts distribution that company executives expect will help cut transportation costs by 25 percent on an annual basis. The new system "breaks down the walls inherent in a supply chain," Inaba said.

Sharing information with suppliers and partners is essential, agreed Stephen Foy, vice president of operations and technology at Bell & Howell Co., a Skokie, Ill.-based vendor of software such as e-mail and messaging products.

Bell & Howell also is in the process of creating a synchronized supply chain, Foy said. It's important, he added, for users to identify what they do well, find a group of high-quality suppliers to handle the rest and then make sure that all of the work being done by the different companies is coordinated.

Sanjiv Sidhu, chairman and CEO of Dallas-based i2, also fingered coordination with suppliers and customers as "the key problem" for users to address. Without a well-orchestrated supply chain, Sidhu said during his keynote speech, companies can't react quickly to sudden spikes in demand for their products and have to stockpile extra inventory and capital equipment in order to be prepared.

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