Businesses are often guilty of setting up functioning supply chains and then leaving them to run, unchanged for years at a time. Without constantly examining, dissecting and working to improve your supply chain, you could be missing out on huge opportunities to cut costs, deliver better service and increase your bottom-line earnings.
There are some effective strategies for supply chain management that should be implemented in your business and can make a marked and quick improvement of your processes. Let’s have a look at some of these strategies.
Be Agile and Ready to Make Changes Quickly
The biggest downfall of business in the modern age is the inability to make rapid and effective changes to processes. In a modern world where we have access to information at the drop of a hat and communication is instant, not being able to make quick changes can be costly. Being agile means you can ride trends and changes in your market as they happen, without waiting for the traditional quarterly or longer results to make changes that could have been beneficial and in place months before.
Some quick tips on being agile:
- React to market changes as soon as possible.
- If something can be changed now, change it now.
- Continuously make changes and adjust your processes from day to day.
- Never rest on your laurels. Always look for improvements.
Don’t Start without a Strategy
Here’s where we find the Who, When, What and Where of supply chain management. When you’re defining a strategy for your supply chain, ask as many questions as you can and examine every step in your processes. Your strategy should find its grounding in real world application thereof and not live in generalized concepts.
Strategies should be detail orientated and each broad stroke heading should be accompanied by a drilldown into just how to execute on each want and need. Don’t just say you want to manufacture in a cheap labor market, choose a market and include projections. A strategy should read like an actionable plan with practical ways to implement it. When you draw up your strategy, make sure that’s what it is.
Don’t Be Scared to Make Compromises
We all like to think that our business can be run like a dream, where a compromise between cost and service never has to happen. As supply chain management this is often the mandate that we’re given, but it’s almost always not practically deliverable. Compromise between the costs of a perfect world supply chain and a realistic one is one of the most difficult decisions to make, but also the most necessary. Purchasing more stock than you need because it’s at a really great price sounds like a good idea, but it might mean that you end up having to deal with aging inventory and subsequently discounting it anyway. Using the quickest logistics partners might mean your customers get their goods sooner but have to ultimately pay more for them and compromise your ability to close deals.
Don’t be afraid to make calculated trade-offs between the cost of what you’re providing and the service that you’re offering, to hit the middle ground between cost and service that offers the sweetest deal.
Embrace Technology, Most of the Time
Technology is everywhere, and in your business supply chain is no exception. Using it smartly and where it’s needed is perhaps one of the most important strategies of supply chain management today. Technology might offer automation and even to replace or augment the human involvement in a supply chain, which can dramatically cut staffing costs, but consider all sides of the implementation of technology before you do it. Well trained and effective supply chain managers can make far more of an impact than technology might.
If you’re looking to upskill your supply chain and logistics team, consider getting them trained. Have a look at the following link https://online.kettering.edu/programs/masters/masters-supply-chain-management-online and look to upskill your human resources.
It might be tempting to patch up a weak point in your supply chain with a piece of technology, but adapting that weakness and improving the process before adding the technology can mean a much more effective implementation.
There’s no doubt technology can vastly improve your supply chain, but being smart about the use of technology is imperative.
Supply Chain Management often requires a delicate touch, balancing many different elements to create an effective end-to-end supply chain. Being aware of where you should focus your efforts as a supply chain professional means that your business is likely to make the best and most effective strategies to manage their supply chain.