The Global Supply Chain and Technology
Suffice it to say, the concept of “global” supply chain management (GSCM) is primarily a result of the globalization of business in general. As businesses search globally for sources of lower-cost materials and labor, someone has to manage these complex and intricate operations.
The combination of globalization and emerging technologies is continuously changing the supply chain. Products that were once made domestically, such as apparel and computers, are now designed, assembled, and marketed worldwide by a conglomeration of organizations.
As a result, there are many risks (disruptions, natural disasters, domestic job loss, and so on) and challenges (short product lifecycles, erratic demand, and so on) that are inherent to the process. To this end, a roundtable at a Dartmouth University Roundtable identified five major issues and challenges ahead (Johnson, 2006):
- Globalization and outsourcing: Including the impact of China and India on supply chain structure and coordination
- New information technologies: Such as radio frequency identification (RFID; a data collection technology that uses electronic tags for storing data) and tools that enable enterprise integration and collaboration
- Economic forces: Within and between supply chains, from consumer pricing to supplier contract negotiation
- Risk management: Includes risks rising from supply chain complexity and from security threats
- Product lifecycle management: Including post-sale service and product recovery
We discuss the impact of global operations and various forms of technology used today in supply chain management later in this book.
For now, we will look back to get a little historical perspective on the topic of supply chain and logistics management.