How to Improve Your Company’s Supply Chain Management Efficiency

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You can have a fantastic company and product, but if your supply chain can’t move materials and products from point A to B quickly, there will be issues. If you follow the supply chain management tips mentioned in this article, your company can deliver products on time and on budget. 

Have Several Suppliers for All Products 

Given the supply chain issues the world is experiencing, it’s more important than ever to have more than one supplier available for particular products. You never know when there will be an unexpected shipping delay that prevents you from getting the products you need. 

If you have several product suppliers, your company can recover if the worst-case situation happens. Also, minimizing label costs while dealing with shipping delays is doable if the delay can’t be avoided. 

Take a Close Look at Supplier Speed

Maximizing your supply chain efficiency also requires a close look at how quickly each supplier can fulfill orders. If one product supplier takes two weeks to produce your order, your firm may need to order more items sooner, so there isn’t a shortage. This can increase the risk of running out if your planning isn’t right. 

Look at the last three months of order fulfillment and see how fast suppliers can ship once the orders are done. Companies that utilize a lean supply chain may experience challenges if a major supplier is located in another country. 

In this situation, a local supplier could be the ideal choice, so there’s no need to fret about a long lead time if your demand planning is incorrect.

Train Your Staff

Your employee training program should instruct new hires about more than just their daily jobs. Include an introduction to the organizational plan to boost company productivity at a lower cost. 

If the company trains employees about efficiency and cost savings from the start, everyone will be on the same page and do their part. This will help keep the supply chain churning along reliably. 

Monitor Your Supply Chain

Just because your company has a well-organized, efficient supply chain today doesn’t mean it will be that way next week. Skilled supply chain professionals know how critical it is to watch supply chain performance constantly. Weak spots can crop up and cause cascading problems that delay product delivery, costing money. 

Many inventory management systems have logistics and supplier management platforms, and these are the ideal way to pinpoint supply chain hiccups. However, your supply chain management team can also watch for problem spots and tackle the job manually. 

Three or four times per year, have your team review the last few months of supply chain performance. Try to find any problematic patterns. For instance, if the company has had 10% more late shipments in the last 30 days, track down the source of the issue. It could be one of your suppliers, inefficient warehouse staff, lack of personnel, or many other things. 

When the source of the supply chain issues is found, it’s much easier to take action quickly and effectively. You might need to try another product vendor, bring in more staff, or improve employee training. 

Boost Information Sharing

It’s also critical that your company’s logistics efforts are as transparent as possible to workers and customers. For instance, dump tedious, error-prone spreadsheets when sharing information. Instead, implement modern information-sharing technology to provide information updates to stakeholders. 

Another information-sharing opportunity to tap is big data analytics. Big data platforms help you to measure your supply chain performance daily. You also can involve your employees in this essential monitoring. 

Using technology to give employees a stake in supply chain performance will ensure the system continues to run smoothly and regularly improve. 

Enhancing the efficiency of a company’s supply chain is a complex process, but these tips can be used to make your supply chain operation better than ever.

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Supply Chain Management (SCM) is the design, planning, execution, control, and monitoring of Supply Chain activities. It also captures the management of the flow of goods and services.

In February of 2020, COVID-19 disrupted—and in many cases halted—global Supply Chains, revealing just how fragile they have become. By April, many countries experienced declines of over 40% in domestic and international trade.

COVID-19 has likewise changed how Supply Chain Executives approach and think about SCM. In the pre-COVID-19 era of globalization, the objective was to be Lean and Cost-effective. In the post-COVID-19 world, companies must now focus on making their Supply Chains Resilient, Agile, and Smart. Additional trends include Digitization, Sustainability, and Manufacturing Reshoring.

Learn about our Supply Chain Management (SCM) Best Practice Frameworks here.