Role of Information Technology in Supply Chain Management: A Case on Lpg Company

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A Term Paper

On

Role of Information Technology in Supply Chain Management: A Case on LPG Company

Name of the Subject: Supply Chain Management

Subject Code: EMIS-537

Submitted By:         MD. ARIF AKRAM RIYADH

ID No: 6173629045

Department of MIS, MBA(Evening)

University of Dhaka

Submitted To:        DR. MD. AKRAM HOSSAIN

Director

Department of MIS

University of Dhaka

Date of Submission: 7th January 2018

Table of Contents

INTRODUCTION3

LPG BUSINESS PROCESS AND ITS SUPPLY CHAIN 5

ANALYSIS OF DATA AND RESULTS6

FINDINGS OF THIS STUDY8

CONCLUSIONS AND RECOMMENDATIONS 10

REFERENCES12

Introduction:

A supply chain is the set of values adding activities connecting the enterprise’s suppliers and its customers. Flow of Information has become a crucial function in setting objective, drawing strategy, taking right decision regarding supply chain of LP Gas throughout the whole country by linking the supplier, manufacturer, distributor, dealer/ retailer and customer to achieve optimum productivity, overall satisfaction and joyful relationship at competitive costing. As LP Gas is a necessary commodity, quick and effective information system helps a manager to understand the customer response, their demand, inventory in stock, amount to be produced, time frame and location of delivery. This study, we have focused on application of information systems in the supply chain of LPG industry. Here we used multi-method to get the best result. The study is compiled with the help of both primary and secondary data. We have collected data from 152 respondents in the relevant field.

To achieve objective properly we developed a semi-structure interview schedule for collecting the information. We have analyzed our data by employing descriptive statistics and Cronbach’s alpha test. This paper illustrated the role of IS in sourcing, network designing, transportation, inventory management, forecasting, aggregate planning, setting goal, benchmarking the goal, troubleshooting from very beginning of the supplier relationship to the end customer relationship keeping smooth internal information flow throughout the process. We found that, if we apply information systems in all steps and drivers of supply chain of LPG industry then it can develop the integrated supplier relationship, strong internal supply chain management, maintain the customer relationship management and so on. This study we have also given some recommendations to the LPG industry of Bangladesh for applying information systems in the supply chain process.

The principle of supply chain activity is receiving input from firm’s suppliers – add value – deliver to customers. To achieve effective supply chain integration, the firms need to implement information technology. Previous research shows that unless the firm integrates information systems with its major supply chain partners to allow for more information and data sharing, the firm will hardly stay competitive in the market in the long run (Hult et al., 2007). After being produced from crude oil in refinery, LPG is stored in storage tank in the terminal and then bottled inside the cylinder which reaches to the end user through the distributors and dealers/ retailers spread all over the country by the four private companies (Omera LPG, Basundhara LP Gas Ltd, Premier LP Gas Limited, Jamuna Spacetech Joint Venture Limited) as per their own business strategies beside BPC, the only Government owned LP Gas Company in Bangladesh (Authors).

Analyzing the future aspect and business growth of the business, other private companies have shown keenness to set up LPG bottling plant whereas the prevailing companies who have already 6-8% business growth per year are trying to boost up them business more vigorously by making new satellite terminal, Regional Distribution Point (RDC), developing new technologies (for example, LPG driven automobiles), increasing product range (Cylinder banking technology, Vaporizer, SNG, LNG), strengthening them distribution network, creating customer loyalty to their brand by launching diverse programs.