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Grid Technology-Based Electronic Supply Chain Management


The advent of the internet and the World Wide Web has brought down an era in which computer-based technologies have a minor or major role in almost all aspects of society, business and industry. The competitive environment of business and corporations have seen the most drastic changes like eCommerce, online marketing, etc. Another most important area which is now waiting for some revolutionary changes is that of traditional supply chain management. Though there are many IT packages for the management of Supply Chain activities, this paper focuses on characteristics of grid technology to develop an electronic supply chain that is more effective and how the same could provide able support in providing solutions and reliable input to corporation management in e-commerce. The paper also provides a view of the future of the electronic supply chain and how could companies adopt the same in the new era.


The biggest achievement of the networked world powered by the internet is that of virtualization of the world economy. A number of changes were experienced and e-commerce expanded its scope from simple online shopping, sale-purchase to the financial and securities industries and changed the whole business procedure prevailed in the Banking and Equities sector through dematerialization. Supply Chain Management is another sector that has been breached by the e-commerce business methodology defying all traditional environments and adding extra strength to core competencies of enterprise in the extremely competitive business environment through partner’s advantage. In the new scenario, the enterprise’s operation is accelerated through integrating e-commerce and supply chain management. (Wang 2008, pp. 114-117)

Now in this 21st century, the requirement is that of using grid technologies for upgrading the World Wide Web with value addition of almost business of 20 trillion dollars to the current web-based economy. The grid will provide an ultimate supply chain experience to enterprises through massive integration of almost all resources on the internet for enabling an electronic supply chain. All possible sources of information and resources will possibly be transformed as partners and hence expanding the whole base of a company for the supply chain management. The emergence of a grid-based network will transform the business workflow of supply chain business processes and hence developing millions of new possibilities and collaborations. (Zhang & Li 2009, pp. 152-155)

Background Review

Supply Chain in its traditional form is more of a linear array structure depending heavily on trade transactions. In almost all purchase-related matters, the end customer or the person/organization at the buyer’s zone is quite far from most of the suppliers. Selection processes require a number of steps and similar steps are followed again and again so that a better bargain could be achieved. But the actual is that of time involved in the complete flow. It may take a few days, a few weeks, or even months to complete the process flow of the whole supply chain. The redundancy of procedures in process flow makes it error-prone and hence sometimes involves a number of omissions and changes. But when the supply chain process flow is structured over a network, almost all participating suppliers are in direct communion with the terminal customers simultaneously. Supply chain in this new environment functions with better synergy and efficiency. (Lo, Hong, & Jeng 2008, pp. 592-614)

Grid technology-based supply chain relies on networks boosted through World Wide Web, internet and intranet. It acts as a guide to the management in synchronized, integrated product planning so that the management could focus on the implementation of all-important modules like procurement, manufacturing, quality control, logistics, marketing, etc. so that a higher degree of customer service and satisfaction as well as lower cost of the transaction. Reaction time in responding to customer need also takes a beating and hence makes for a more flexible and convenient business scenario. The functioning methodology gets changed from “push” to “pull” and the operation model is immune to Bullwhip Effect.

Market-based on the network is now a self-growing structure and expands constantly into seamless connection. (Bayraktar, Lenny, Gunasekaran, Sari, & Tatoglu 2008, pp. 193-214)

In almost all developing nations, immaturity in the functioning and behavior of supply chain management is quite obvious. Enterprises have to found practicing a vertically integrated structure which promotes higher internal cost of supply chain department and extremely slow reacting capability of the market. Unusual lack of trust and excessive mutual independence causes a higher cost of procurement and hence chunks out the competitiveness of the end product. (Hendricks, Singhal, & Stratman 2007, pp. 65-82)

Personal Recommendation

Integrating grid technology, communication between the enterprises with the suppliers for developing the core of supply chain during upstream movement of business process and customers during downstream movement in the supply chain would be seamless and smooth. The e-commerce information technology when powered with grid technology transforms the World Wide Web into a smooth information system with the capability to realize highly efficient and wholesome supply chain management through seamless real-time information sharing channels. For this, the Company would require the implementation of a common infrastructure for supporting Enterprise Application Integration and B2B. The new system architecture will have space for both new technology and old tradition. It will actually integrate itself into the existing applications present both inside and outside the organization. This collaboration has been for the purpose of developing the next level of Web services development and runtime capability. The whole new architecture will cater to common services for security and Web service management. The shortcomings present in traditional point-to-point cross-application data exchange interface strategies and tightly coupled application integration have been rectified and have evolved to an enterprise-wide real-time system. (Foster, Kesselman, Nick, & Tuecke 2002; Cohen 2010 )

The e-commerce-based solution offered through grid technology can make it possible for the enterprise to offer security and flexibility across the entire enterprise while integrating the latest technology with the company’s existing technology infrastructure. The e-room professionals under the supervision of Supply Chain Managers have would develop a self-service ASP model for the internal customers and the extended enterprise teams. Grid technology would actually help the organization in deploying collaborative applications for improving the quality of its product and finally can maximize the operational efficiencies and manage the cost-effectively. Essential activities like sharing and collaboration on product documents and project history management and conflict resolution would be possible just with a click of the mouse. Some of the basic features associated with this technology are cost-saving, time-saving, reduced IT costs, and finally reduced Co-location costs. The increased data sharing and process data flow integration and speed of accessing documents save several Man-hours. The Co-location costs are greatly reduced with a reduction in travel costs and less need for relocation costs. (Foster, Kesselman, Nick, & Tuecke 2002)


Traditional supply chain practices have always been marred with the Bullwhip Effect and its inefficient linear array structure of suppliers and slow vertically structured internal organization. But with the introduction of grid technology-based information system structure, the supply chain workflow achieves the highest level of data visualization and information sharing between terminal customer and core supplier. The real-time availability of data and information enables seamless interaction as well as fund flow and finally provides the most effective solution to all sorts of deficiencies like higher reaction time, non-automated functioning, delay in delivery, etc. out of supply chain processes.


Bayraktar, E, Lenny, K, Gunasekaran, A, Sari, K, Tatoglu, E 2008 ‘The role of forecasting on bullwhip effect for E-SCM applications’. International Journal of Production Economics, v 113, n 1, p. 193-204.

Cohen, R 2010 ‘Cluster and Grid Computing in Japan: Today and in 2010’.

Foster, I, Kesselman, C, Nick, J & Tuecke, S 2002 ‘The Physiology of the Grid: An Open Grid Services Architecture for Distributed Systems Integration’.

Hendricks, K, Singhal, V, Stratman, J 2007 ‘The impact of enterprise systems on corporate performance: A study of ERP, SCM, and CRM system implementations’. Journal of Operations Management, v 25, n 1, p 65-82.

Lo, W, Hong, T, & Jeng, R 2008 ‘A framework of E-SCM multi-agent systems in the fashion industry’. Journal of Production Economics, v 114, n 2, p 594-614.

Wang, Y 2008, ‘Management of electric power SCM’. Journal of Transportation Systems Engineering and Information Technology, v 8, n 2, p 114-117.

Zhang, Y & Li, L 2009, ‘Study on supply chain workflow based on grid’. Proceedings of the 2009 International Symposium on Web Information Systems and Applications (WISA’09) Nanchang, P. R. China, 22-24, 2009, pp. 152-155.

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