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The Internet will be the tool that will harness the power of the supply chain in maximizing customer satisfac­tion. The unlimited capacity of this electronic medium to dramatically improve the performance of the entire supply chain, primarily by increasing information flow, will continue to transform many business processes, creating opportunities to serve customers in new and imaginative ways. The challenge for organizations will be to develop a strategic roadmap that will enable them to use the specific elements of the Internet that will help them in improving the performance of their supply chain.

This paper will focus oil the impact and use of the Internet as part of a cohesive electronic-based supply chain management process. The first part of this paper will provide a brief overview of electronic commerce trends and issues. The second part will discuss the use of the Internet in managing the supply chain. Ultimately, the linkage between customers and suppliers continues to shorten, and the positive or negative performance of the supply base is often reflected in customer service. The use of electronic commerce tools, including the In­ternet, will improve communication flow, the corner­stone of an effective supply chain management process.


Electronic commerce is making its powerful presence felt throughout the supply chain. Elements of electronic commerce, from simple e-mail to Web browsing to so­phisticated data encryption, are finding their ways into today's business environment. While not all organiza­tions have joined the electronic commerce revolution, all organizations have been touched by it. It is having a profound effect on supply chain management as the Internet and related technologies are transforming tra­ditional buyer/seller relationships. Firms are using ele­ments of the technological infrastructure to improve production, sales, procurement, marketing, and service processes. Supply chain management, the procurement strategy that links customers and suppliers together in a series of cohesive, interdependent relationships, claims many of the benefits of electronic commerce. These ad­vantages include instantaneous global communications, immediate access to current business and product in­formation, and the digital exchange of engineering and technical documents, as well as the ability to increasethe speed and accuracy of order processing, fulfillment, and payment through online purchasing transactions.

Electronic commerce is a tenn used for managing and conducting business within a digital information environ­ment. It has become the major means of operating survival in the global marketplace. Electronic commerce is an all-encompassing tenn for electronic-based business practices, including electronic data interchange (EDI), bar-coding, interactive computer-aided design (CAD), computer-aided manufacturing (CAM), computer-aided engineering (CAE), imaging smart cards, telephones, cellular communication, wide and local area networks, the Interner, interactive video, facsimile, file transfer protocol (FTP), and e-mail. Electronic commerce will improve business processes by streamlining various business applications, eliminating or reducing non-value-added tasks, and improving internal communications throughout the company as well as external communica­tion throughout die supply chain. The improvements have the abilities to improve customer service, lower costs, re­duce cycle times, improve manufacturing or other business processes, improve marketing and advertising efforts, and speed time to market. Strategic and proper use of electronic commerce tools will generally help most businesses.

Electronic commerce initiatives in most organiza­tions usually begin slowly. An immediate conversation of traditional business practices to electronic methods can be foolhardy and an invitation to disaster. Begin­ning the process at its most basic and least expensive level will create a strong foundation for future growth of the medium. However, companies need to quickly devise an electronic commerce roadmap to properly take advantage of the medium. E-commerce has the capabil­ity to build on itself, and companies, while beginning slowly, should take real advantage of available tools and build capabilities as quickly as practical.

Effective electronic commerce need not be a confus­ing array of high-priced hardware and complex software. The tools necessary to begin the use of electronic com­merce are available today in most offices and homes, Costs are down, sophistication is up, and the time is right to begin to employ the tools and attitudes of elec­tronic commerce. However, entrants to the electronic commerce arena must keep up with evolving processes. The entire process is changing and growing at a dizzy­ing pace, and participants must be ready to change and adapt to changing conditions.

To begin the process, it is best to follow some simple organizational steps:

      Assemble a cross-functional team that will monitor
and guide the electronic commerce process.

      Develop a technology roadmap that will help define
the electronic commerce process in your company.

      Determine the business process that will best benefit
from electronic commerce techniques.

      Motivate, train, and enlist the support of employees.

      Utilize the best electronic commerce tools to benefit
your business.

      Continually review, revise, and revisit.

To Be Continued

For balance of this article, click on the below link:

Lean Manufacturing Articles and click on Series 12


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