Tuesday, April 19, 2005

Impact of Web Services on SCM

Web Services will enable all players in the Supply Chain to participate effectively in the value addition process.

Web Services is to Business Applications what SQL is for Databases. Web Services is all about standardization.

Web Services use standards like XML, SOAP, WSDL and UDDI. All Business applications will support these standards. This will enable all applications to talk to each other using a common language which is XML irrespective of what hardware or software is being used.

The 2 main impacts of Web Services will be as follows:

1) Application to Application communication without human intervention will become possible.

2) It will enable Service Oriented Architecture for Business Applications. Just like we use Water and Electricity, Business Applications will be available on a montly subscription basis (ASP Model). This will be a very big boon to small and medium scale companies which can't afford to have their own ERP infrastructure. Total Cost of ERP and Supply Chain systems will come down drastically.

The major impact from the SCM standpoint is that true seamless integration between all parties in the Supply Chain will become a reality. Moreover the cost and time for activating this seamless integration will be half of what it takes today.

So you will see implementation times being reduced quite drastically. This is from a technology standpoint. The human element in Supply Chain implementations will still be a issue which needs to be dealt with skillfully by Consultants and Project Managers.



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