Information and Communications Technology and Supermarket Chains - Part 2

The assertions I made in my previous post on the role of ICT in the supermarket supply chain management include: stock management, supply chain management and distributed systems management across Australia.  Communications within the retailer’s franchise and with customers and suppliers, from Point of Sale to Automation, Warehousing and to higher levels of organisational management and reporting.

One article I have referenced is “Analysing trust as a means of improving the effectiveness of the virtual supply chain”¹ which treats the organisation of the supply chain from the supplier through to the retailer as a Virtual Organisation. “. Traditional relationships between retailer, manufacturer, distributor and farmer have begun to change, with moves towards partnerships and alliances that have a greater emphasis on supply chain management”² (Thompson, 2001).

One of the primary problems that faces the Virtual Organisation is the lack of daily face-to-face contact instead relying on electronic means such as “mobile phones, e-mail, the internet, fax machines and other electronic devices, acts as a communication and coordination mechanism among partners”¹  (Paterson and Maguire et al., 2008, pp. 325-348).

“The Australian horticulture industry supply chain is moving towards more electronic identification of pallets, cartons, trays, and individual pieces of fruit and vegetables. Woolworths’ supermarkets required all their supply chain partners in the fruit and vegetable sector in 2005 to place GS1 barcodes on all pallets”¹

The GS1 barcoding allows communication of shipping weights, product information and scanning to process from Supplier to Customer throughout the retail chain – it’s in international standard for communicating what goods are being shipped in specific quantities.

Regarding the distribution of management of an organisation of this magnitude, (Matopoulos and Vlachopoulou et al., 2007, pp. 177-186) mention:

“Concerning industry's macro-factors, globalization extends the business scope and activities of a company, to other regions. At the same time, the government of activities that are now dispersed in a greater geographical range becomes more difficult, increasing the need for collaboration … Collaboration in the form of increased information exchanges is needed in order to achieve transparency across the supply chain.”³

Warehousing, especially with regards to distribution centres have are migrating to automated pickers and other systems to improve efficiencies and reliability of information and supply chain management. “An effective traceability system brings many benefits, such as increasing the security and confidence of customers, and limiting withdrawal of commodities”⁴  (Ino and Montrucchio et al., 2009, pp. 2357-2365).

“An effective traceability system is fundamental for avoiding a large waste of resources. Automation is regarded as the key to realize an effective internal traceability system.”⁴

As shown by the references, the warehousing, supply chain management and organisational management in Supermarket retail is highly driven by ICT currently, and looking forward to the future.

References:

1.      Paterson, I., Maguire, H. and Al-Hakim, L. (2008) Analysing trust as a means of improving the effectiveness of the virtual supply chain. International Journal of Networking and Virtual Organisations, 5 (3), pp. 325-348.

2.      Thompson, G. (2001) Supply Chain Management: Building Partnerships and Alliances in International Food and Agribusiness, Rural Industries Research and Development Corporation, Canberra.

3.      Matopoulos, A., Vlachopoulou, M., Manthou, V. and Manos, B. (2007) A conceptual framework for supply chain collaboration: empirical evidence from the agri-food industry. Supply Chain Management: an international journal, 12 (3), pp. 177-186.

4.      G, Ino, F., Montrucchio, B., Rebaudengo, M. and Sanchez, E. R. (2009) On improving automation by integrating RFID in the traceability management of the agri-food sector. Industrial Electronics, IEEE Transactions on, 56 (7), pp. 2357-2365.