For many businesses, supply chain management is a make or break area of expertise. Better supply chain management means more consistent availability of necessary products, more consistent deliveries, and happier customers. Flaws in your supply chain management approach mean a host of potential issues, from problematic vendor and customer relationships to major disruptions that can cost you major sales.
So how can you improve your supply chain management approach?
Choose the Right Partners
You can start by choosing the right partners. Much of your supply chain management depends on your ability to choose the right vendors and suppliers. You may even choose to work with partners who directly impact your supply chain management, like those offering MRO integrated supply services.
It’s important to always do your due diligence before adding someone to your supply chain, no matter where they fit in that chain. Make sure you at least review the following:
- Experience. Experience and past results are typically two of the best indicators of future performance. If a company has been in operation for many years, and they’ve helped many businesses like yours, chances are good that they’ll be a valuable addition to your supply chain network. This is compounded if they have a history of good reviews and testimonials to back up their claims. That doesn’t mean you should instantly ignore any new player with minimal experience on the market, but their burden of proof may be higher.
- Communication. As a partner in your supply chain, you’ll likely be doing a lot of communication with this entity. You need to make sure that that communication is going to be clear, consistent, and reliable. Sometimes, that means having a dedicated point person on the other side. Other times, that means have a clear system of communication protocols in place. In any case, you need to feel confident that you’ll be able to reach someone and have an effective conversation whenever you need that contact.
- Security. Next, you should investigate security, especially if you’re dealing with sensitive information or if your business is subject to regulations related to data privacy. Always do your due diligence to make sure your supply chain partners are going to fit neatly into your data security infrastructure.
- Fit. As an organization with lots of vendors and customers, it pays to think in terms of portfolio management. Each vendor or customer is going to be a single node in your overall portfolio of vendors or customers, and you’ll need to manage these portfolios actively if you want them to remain balanced. When adding a new partner, ask yourself, what does this entity add to your existing network? And are they truly indispensable?
Invest in the Right Technologies
You also need to invest in the right technologies. These days, supply chain managers are blessed to have an abundance of powerful technological tools that can help them with everything from vendor due diligence to process automation.
When reviewing new tools to add to your technology stack, always look at the following:
- Key features. There are many tools that sell themselves as supply chain management software or something similar, but they don’t always share the same key features. Make sure you’re clear on exactly what each tool offers before reviewing it any further.
- Automation potential. Automation is huge in the world of supply chain management, since it saves time while simultaneously reducing errors.
- Scalability. If your business is growing, make sure you choose a platform that’s scalable.
- Integrations. If you already have indispensable tools in your technology stack, make sure they can integrate seamlessly.
- Usability. Don’t neglect the usability, which can streamline efficiency and make it easier to onboard new users.
- Cost. And of course, you’ll need to consider costs.
Improve Visibility
Supply chain visibility is all about transparency – and you need it at every level of your supply chain. Keeping real time data flowing and making sure it’s visible to all parties it’s going to make it much easier for you to maintain efficient operations. It’s also going to be invaluable for ensuring open, transparent communication and resolving problems as quickly as possible.
Build Your Relationships
We’ve already talked about starting new relationships with partners in your supply chain, but we also need to emphasize the importance of building and developing those relationships. Once you have good partners in place, ensure consistent and open communication to keep those relationships strong.
Remain Agile
Finally, remain as agile as possible. Your approach to supply chain management is never going to be perfect, which means there will always be room for improvement. On top of that, pressure from technological changes and new competition can force you to make changes. The easier and faster you can adapt, the more competitive you’re going to be.
Perfecting the art of supply chain management isn’t easy. But with these principles, you can at least improve your approach.
Founder Dinis Guarda
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