Australian School of BusinessSchool of Information Systems, Technology and ManagementAustralian School of BusinessThe University of New South Wales

2012-S2 INFS4885, 5885: E-BusinessElec Eng G024, Thurs 6-9 pm

Lecturer: Fouad Nagm

Week 4: B2B and SCM

B2B E-Commerce Definition

“Transactions between businesses conducted electronically over the Internet, extranets, intranets, or private networks; also known as eB2B (electronic B2B) or just B2B.”

E-Procurement

E-Procurement: The electronic acquisition of goods and services for organizations via the Internet, EDI, etc.

E-Procurement may help to overcome difficulties in traditional procurement

E-Procurement (by businesses)

E-Tendering (by governments)

Request for Quote (RFQ): The “invitation” to participate in a tendering (bidding) system

Reverse Auction (see next slide)

4-10

E-Procurement

SCM (Supply Chain Management)

What Is a Supply Chain? A supply chain is a collection of companies and processes

moving a product:① from suppliers of raw materials

② to suppliers of intermediate components

③ to final production

④ to the customer

Upstream supply chain—flow from sources of raw materials and components to company

Downstream supply chain—flow from company to end-consumers

Suppliers have their own supply chain

A better name: supply network.

SCM: Supply Chain Management

Source: Wieland & Wallenburg (2011)

Linear Supply Chain

Supply Network

Supply Chain: Apple iPhone

Benefits and Problems SCM

• Potential benefits

Process innovations

Just-In-Time Production (JIT)

Vendor-Managed Inventory (VMI)

• Potential problems

Distorted information

Excessive inventories

Inaccurate capacity plans

Missed product schedules

Just-in-Time (JIT) Production Keeping inventory is costly (storage, capital, missed production schedules)

JIT optimizes ordering quantities Parts and raw materials arrive when needed for production. As orders arriver in smaller quantities (but at higher frequency)investment in

storage space and inventory is minimized.

The approach was pioneered by Toyota

It is used extensively by computer manufacturers to avoid component obsolescence (Moore‘s law).

Example: Dell keeps only two hours of inventory in stock

JIT requires tight cooperation between all partners in the supply network.

Vendor-Managed Inventory (VMI) VMI is a business model in which suppliers manage the vendors’ inventory based on pre-

established service levels

Supplier monitors stock levels and sales data

VMI requires vendor (manufacturer, retailer) to share real-time data

•Benefits

Cost savings

Minimized stock-out situations

Accurate forecasts

Reduced errors

Prioritized goods shipments

Supply Chain Visibility/Analytics

Supply chain visibility—the ability to track products as they move through the supply chain but also to foresee external events.

Supply chain analytics—the use of key performance indicators to monitor performance of the entire supply chain, including sourcing, planning, production, and distribution.

Web Development

3 Key Factors When Designing A Website (video)