Information is important because it provides the facts that supply chain managers use to make decisions. Without information, a manager will not know what consumers want, how much inventory is in stock, and when more products should be produced and shipped. In short, without information, a manager can only make decisions blindly.

Managers must understand how information is gathered and analyzed. This is where information technology comes into play. Information technology serves as the eyes and ears of management in a supply chain, capturing and delivering the information necessary to make a good decision. For instance, an IT system at a personal computer manufacturer may help a manager analyze the information and recommend an action. The manager can use the remaining chips first, then look at demand forecast, and determine whether to order more chips.

There are four reasons why timely and accurate information has become more important for effective logistics system design and operations. First, customers recognize information about order status, product availability, delivery schedule, and shipment tracking as necessary elements of total customer service. Then, managers realize that information can be used to reduce human resource requirements. What’s more, information increases flexibility with regard to how, when, and where resources may be used to gain strategic advantage. And finally, enhanced information transfer and exchange capability of using the Internet is changing relationships between buyers and sellers and refining channel relationships.

1.Why is information important to supply chain managers? (1)

A. Because managers need the information to make decisions.

B. Because managers need to know what consumers want.

C. Because managers want to know the product inventory.

2.Which is NOT the function of information technology? (2)

A. Information technology works to capture necessary information.

B. Information technology is used to deliver necessary information.

C. Information technology is applied to gather as much information as possible.

3.What is NOT considered as a necessary element of total customer service? (3)

A. product price

B. order status

C. shipment tracking

4.What kind of flexibility does the information increase? (4)

A. The flexibility to buy resources

B. The flexibility to use resources to gain strategic advantage

C. The flexibility to ask questions about resources

5.What is changing the relationships between buyers and sellers? (5)

A. The available products

B. The use of the Internet to exchange information

C. The overall customer service