The importance of warehousing in global supply chain management is arguably the most important aspect of supply chain management. Without organized, efficient, and cost-controlled warehousing, “market pressures such as smaller shipments, faster delivery, and rapid proliferation of products make warehouse management difficult for meeting the demand for high service quality with low costs” (Manzini, 2008, p. 2). The basic functions of warehousing, including receiving, organizing, storing, order picking, and shipping are included under the definitional umbrella of warehousing and together, they comprise the basic features of any warehousing system, global or local.
Fluctuation of inventory levels in the supply chain is a serious problem for any supply chain because if a company is not able to track what it has available to sell, it cannot easily satisfy the consumer. If inventory dips to a point where there is no stock available for sale, dissatisfied customers tend not to return for future sales. The ability to plan and adjust for inventory fluctuation is a coordinated effort that must be undertaken. The problem lies with the fact that “suppliers, manufacturers, sales people, and customers have their own, often incomplete, understanding of what real demand is. Each group has control over only a part of the supply chain, but each group can influence the entire chain by ordering too much or too little” (Michael, 2006, n.p.). Additionally, the decisions of each of these separate components do have major effects on the other components.
The cultural barrier between supply chain partners should be addressed first before focusing on implementation of a supply chain wide information technology, and regarding the quality of and timeliness of information sharing, it should be given priority.
Finally, some of the latest technologies incorporated by leading global supply chains are supply planning optimization software, chain visibility software and hardware, and advanced supply chain analytics.
- Manzini, R. (2012). Warehousing in the global supply chain: Advanced models, tools, and applications for storage systems. Springer: New York.
- Michael. (2006). Bullwhips and beer: Why supply chain management is so difficult. Forio. Retrieved from http://forio.com/about/blog/bullwhips-and-beer/
