IT Supply Chain being Reengineered

IT has helped a lot in supply chain efficiency

Generally IT supply chain’s inefficiencies and cost overruns stem from a lack of transparency in an organization. There lies some differences between business users and IT. Both will have to cooperate to make the system efficient.

There is no proper flow of information between the two which leads to high costs.

How one can overcome these type of problems

You re engineer your company's IT supply chain to create an effective exchange of information between all stakeholders.


Also, take care of information around capacity planning and forecasting about the product otherwise you have to hold buffer stocks. Many organizations have spent considerable effort developing models to limit inventory holding costs or to minimize the risk of stock outs.


IT infrastructure presents dilemmas similar to external supply chains logistics. When hardware were perceived as inexpensive, firms may not have been overly concerned with the added costs of holding reserve capacity to act as a buffer stock. The demands of applications like CRM mean that users could expect volatility in their storage utilization or processing resources.


At certain times they will need additional resources, so firms may need to purchase resources to meet peak demands, knowing that those resources may sit idle outside peak periods.


Most of the times Data storage provisioning is especially problematic and the problems which develop are low storage utilization and higher than necessary costs.

I think companies can re engineer their physical supply chains in several ways, the IT supply chain is a totally different matter.

Re engineering can be done with an effective exchange of information between all points and it is exchanged regarding cost parameters, service expectations, and service performance.