Inventory technology reduces risk in supply chains
October 11, 2013
As more organizations place their supply chains at the center of their strategies, modern inventory technology has grown in importance. Companies cannot maintain a successful supply chain strategy without technology that will help them comply with inventory legislation.
Many multinational corporations are taking greater interest in corporate social responsibility. While this has benefits in creating more ecologically sound business practices, it also helps firms reduce risks and improve public reputation. Many organizations have found they experience higher risks from their ecological footprints, conflict minerals and human rights issues from labor conditions, according to The Wall Street Journal. In fact, these factors have led risk management and reputation to be the driving factors in supply chain management. Companies have gotten more involved in corporate social responsibility because in some cases, their bottom lines are at risk.
"Corporate social responsibility is driving consumers, who are driving retailers, who are driving the brands," said Paula Ivey, president of The CSR Group at a conference, according to The WSJ. "CSR is going mainstream. Uptake is happening rapidly."
Since these strategies are ultimately impacting the choices consumers make in where they shop, retailers need to consider social responsibility in their inventory management.
Manufacturing inventory software will play greater role in supply chain risk management
Companies have multiple concerns when it comes to supply chain risk management. Consumers are placing a greater emphasis on goods that are sustainably sourced. Since many shoppers are more knowledgeable than they were in the past, they will not purchase products with ingredients are grown or made in an unsustainable way. Additionally, organizations face increased regulations from the government, such as the Dodd-Frank Act. This legislation monitors the use of conflict minerals, and businesses need to comply with state and federal laws regarding labor practices, Inside Counsel stated. All of these factors impact supply chain management. Businesses that produce goods overseas still need to be aware of labor laws.
In order to protect themselves against these risks, firms need to adopt supply chain practices, and inventory plays a large role in this. All links in the supply chain need to be carefully monitored to prevent disruptions. Since maintaining a good reputation is more important for business success, companies do not want to risk having shortages of popular items. Businesses need advanced technology to help them adapt to these changes.