Globalization and advancing technologies constantly pressure supply chains, forcing enterprises to continuously reinvent their supply chains to avoid the negative effects of supply chain disruption. With good strategies, you can see significant growth and opportunities to improve your supply chain. This article explains how to sufficiently optimize your supply chain.
Here in Part Two, we’re going to talk about some specific steps supply chain leaders can take to respond to these continuing challenges. We think those who take this moment in the spotlight to craft a truly strategic response, have the opportunity to emerge as leaders, not only for their supply chain operations, but for their companies as a whole.
Tips for Improving Your Supply Chain
The first step is to come up with effective strategies that will help streamline the entire chain and ensure its components are properly linked for fewer disruptions. Here are some important strategies you can use:
Enhancing Company-Owned Inventory
Consistently check your company-owned inventory to ensure that you are only holding or storing the desired quantity–holding excess inventory can be costly in the long run because it will increase the price of the product. The cost of holding inventory for one year represents about 605 of the final price of the item, so use demand planning and forecasting strategies to optimize your inventory.
Setting Up a Supply Chain Governing Council
Your supply chain governing council will provide clear strategies for improving performance and efficiency, and will also provide direction and create strategies that ensure the supply chain aligns with your company’s primary objectives. It will also bridge the communication gap within your company by providing cross-functional communication.
Enhancing Your Distribution Network
There are two main ways to enhance your company’s distribution network: first, you can use the cluster approach, which includes putting together charts, diagrams, and other related documents to easily monitor processes for specific functions within the company. This can be implemented by using the right enterprise service management programs and tools.
With a program like Elementum, you can monitor and record incidents that you can use to streamline your supply chain processes in the future, which can also help improve your service supply chain process by allowing you to collaborate with all stakeholders, including vendors, transporters, suppliers, and customers.
The second way to improve your distribution network is by using an integrative approach, which involves reviewing important constituents of your distribution network so you can understand how they work together.
The current technological advances are designed to revolutionize different sectors of the economy. Find time to review your entire supply chain to identify areas that can be improved through technology–for instance, Elementum Project Management software can help automate key processes like collaboration, incident management, analytics, reporting, security, and compliance.
Reviewing Supply Chain Processes Regularly
You have to review your supply chain processes and policies to ensure they are in line with your company’s objectives, which will also help you avoid risks and come up with effective solutions to any problems. Regular reviews will help identify bottlenecks in your supply chain and estimate their financial effect.
Establishing Sustainability Management
Today, every organization is expected to engage in activities that will help reduce its carbon footprint–therefore, you should ensure that your company’s supply chain processes are sustainable and safe for the environment. Through sustainability management, you will figure out the best ways to carry out your production, logistics, and other operations with minimal effect on the environment.
Finally, these strategies can transform your supply chain and make it cost-effective. Review your supply chain regularly to identify potential setbacks and risks so that you can take preventive measures before you experience any serious supply chain disruption.