An effective, well-built supply chain provides a wealth of benefits for your organisation, from reduced operating costs and improved margins to faster delivery times and more positive consumer experiences. The biggest companies in the world are constantly improving their supply chain: this week, The Manufacturer reported that BMW is tightening every link in their supply chain in an efficiency-boosting programme. Is it time to review yours too?
Is your supply chain cost-effective?
It all comes down to cost. When most people talk about the ‘effectiveness’ of a supply chain, they are referring ultimately to its cost-effectiveness. Being cost-effective means taking a total view of all costs across your integrated processes and working out what you can optimise for cost reductions. One key area to optimise is your inventory: holding and storing inventory is a significant cost, often higher than what is generally assumed. To optimise your supply chain inventory, include forecasting and demand planning.
Businesses should also focus on sustainability, in both senses of the term. First, look at whether your supply chain processes are sustainable: whether they are consistent, carefully planned and resilient enough to achieve your objectives in the face of unexpected challenges. Then examine your company’s environmental impact (around 80% will be found in your supply chain) as having ‘green credentials’ is becoming increasingly important in improving reputation and performance. In a recent survey, HSBC found that a third of global businesses are looking to enhance the sustainability of their supply chains to improve their bottom lines.
New technology to improve your supply chain
Good business leaders are always looking for new ideas to improve their operations. They strive to stay ahead of the competition by experimenting with new processes and adopting the latest technologies before anybody else.
Recently, a supply chain publication predicted that ‘drones, autonomous intelligence and robotic automation will eventually transform warehousing and transportation, which will create networks that may look and operate very differently from those of today.’ Identify areas where technology can improve and streamline your supply chain strategy; many common issues can be solved by the automation provided by new tech.
Maintaining effective supply chains should also involve the regular review of warehouse management systems (WMS). Consider whether you should invest in additional technology to improve inventory-handling accuracy, allocation of human resources and cost control. Technology is constantly shifting, which is why companies must stay on top of developments or get left behind. For Forbes, the next phase of supply chain optimisation will be ‘the adoption of immersive technologies, such as augmented reality and virtual reality, to enhance their employees’ and customers’ digital experiences.’
The importance of data for ecommerce
With the appropriate technology in place, detailed reporting data will be more accessible and accurate, helping you measure your performance and plan for the future. Gathering data on your supply chain is key to growth; you can be confident that you’re making the right decisions at any given time to keep costs down and to improve productivity.
Supply Chain Quarterly states: ‘Once critical areas are measured and the data is collected, companies can then make that data actionable to create an agile supply chain.’ Become a data-driven operation and give yourself the freedom to take calculated risks.
Our final advice is that, in improving the effectiveness of supply chains, businesses shouldn’t lose sight of one of the most important aspects of their operation: their people. Your supply chain should be staffed and structured in a way that maximises effectiveness as well as efficiency, to bring the most benefit to your organisation.
Find the time to develop your employees and their skills, and your strategically staffed supply chain structure will work much better for you.
Sprint Logistics is an established global expert in end-to-end supply chain processes, providing invaluable benefits to business and their customers by reducing cycle times and costs. With a complete range of freight forwarding services, we offer smart, cost-effective and sustainable solutions, believing that what we offer is an extension of your business.
If you would like help and advice with your supply chain, contact us today.