Supply chains have existed since man began trading thousands of years ago. However, until the beginning of the 20th century most were based on moving products from person to person on a simple needs basis.
Goods were customised and only produced as required and stock was limited or nonexistent.
Mark Levy, director of Digital Planet, says the industrial revolution changed everything. Products were made in factories and shipped to the far corners of the world. Warehouses and regional distribution centres emerged and manufacturing and stocking most often preceded demand," he says.
"In the new economy we are moving back to the future.
"Every single industry is experiencing changes in the way supply chains are managed, and the better management of supply chains is seen as one of the most important business issues facing corporations today."
There has been an explosion in the development of new systems to help track, measure, change, control, facilitate and improve supply-chain efficiencies. Levy says the most talked-about technologies that have become prominent are those relating to exchanges and marketplaces.
Essentially intermediaries most often sophisticated software packages act to bring together buyers and sellers of products and services.
"This is often conducted on a global scale where buyers and sellers from across the globe can connect in real time and trade," Levy says.
There are now over 300 marketplaces operating in north America, and many of those are seeking to expand to new markets as aggressively as possible. He says the theory is that only a very few of these exchanges will survive because both buyers and sellers will tend to want to deal with as few differing technologies as possible.
"Companies such as Commerce One, Ariba, Infobank and Oracle have all set up aggressive local partnerships to help build these exchanges.
"In addition, organisations such as Sasol, Standard Bank, Bidvest, Nedcor and Old Mutual are also seeking to gain a foothold in this potentially very lucrative business-to-business space."
Levy says this year the business-tobusiness arena promises to be extremely interesting.
He says there is no doubt that many software vendors will merge and that, as the technology becomes ubiquitous, all the members of the supply chain will have to co-operate with the marketplaces to re main competitive.
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