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Steps for Finding Supply and Demand Harmony 

   
2019-03-31 
Enterprise Resource Planning (ERP) Systems have become indispensable in today's business environment. From QuickBooks, which is used by small businesses to SAP, used by midsized to large businesses, these programs allow users to keep track of their vendors and customers. Note only that, ERP systems like SAP allow a company to manage most of their main departments such as Supply Chain, Customer Relations, Production, and Financials.

It is important for companies to be able to manage all aspects of the company, but in today's environment where businesses rely on others to be able to function efficiently and to serve their customers, there is the need for a company-vendor as well as a company-customer ERP relationship. Businesses are able to do these intercompany processes by using the Supply Chain Management (SCM) and the Customer Relationship Management (CRM) modules of an ERP system. 

In order to achieve this, management will have to take certain important steps:

1. Identify suppliers and customers critical to your business strategy 

There could be hundreds of suppliers for just one product being made. Management should identify those that are critical to the normal operation of the business. For example, if you are a chocolate products manufacturer, chocolate is critical to your manufacturing process. Another part of this process is to identify your critical customers because you do not want to have finished goods sit in the warehouse.

2. Integration 

When you have identified all the critical suppliers and customers, the next move will be to integrate your ERP system with theirs. It will take efforts from your management and the other stakeholders' management to do this integration. Integration involves connecting your ERP system to those of the suppliers and customers. As I mentioned before, ERP authoring companies have realized this need have written modules to complement their products.

These two steps explained above are very important, especially for companies that utilize the lean management and Just-in-time (JIT) processes. In a JIT system, the customer's system sends a request to the company that makes the products. The manufacturer's system then sends a request to the suppliers. 

This pull system creates harmony between supply and demand and reduces costs. In systems that are tightly integrated, the systems go far beyond requests: The integrated companies have access to financial trends and reports of the other companies in the dashboard of their ERPs. 

By: Emmanuel Anukun-Dabson 

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