A well-managed supply chain operation has in recent years become a critical factor for a business to succeed. However, many still ask themselves why they should transform their supply chain? Simple. Because it will save you money, now! More and more companies realize that great supply chain operations are critical to the success of great businesses. So, regardless of whether or not you act, your competitors are transforming their supply chains and reaping the benefits.
Technology plays an important role in taking your supply chain to the 21st century. However, in order to really transform a supply chain, it also requires a review of processes and organization. In this article we’ll go through the topics you should keep in mind to revolutionize your supply chain.
1. Align supply chain goals with your business’s strategic goals
“Well planned is half done”, so keeping your business goals in mind, you should start by asking yourself “what do we want to achieve?”. Some typical answers are streamlining processes, reducing manual work, or better forecasts, while typical KPIs include availability, inventory, spoilage, and sales.
2. Prepare for organizational changes
Because supply chain transformation processes often involve organizational changes, the next step is to evaluate how you will organize your replenishment operations. Today a centralized (rather than decentralized) replenishment team is widely considered as being the best practice option. There are advantages and disadvantages in both approaches, so which ever you pick it should, again, reflect your business goals.
3. Win over your colleagues to support the project
Without the support of your colleagues you won’t get far with your project. And it can sometimes be challenging to win them over. A good tip is to work top down and bottom up by finding the right people to help you overcome barriers to change within the whole organization.
4. Choose the right technology for the job
Earlier, we noted that technology also plays an important role in today’s supply chains. So when you’ve managed to win over your colleagues it’s a good time to think about the tech side. The usual question is “Do you develop in-house or look for a best-of-breed system?”. Maybe you already have a system, but is it suitable for the task? Can it develop with you as your business is changing and developing? Or should you look into a more modern, agile solution that can support you now and in the future? Weigh the risks and make sure the system is flexible and adaptive to your needs.
5. Structure the implementation project carefully
Last but not least, once you’re fully committed to transforming your supply chain, you’re backed up by your colleagues and you’ve settled on how to move forward on the technical side, it’s time to structure your implementation. It’s a serious task to implement a system and transform your supply chain so it’s best to plan ahead in order to avoid any pitfalls. It’s recommended to start with an analysis phase in order to find any pain points. One of those pain points is usually master data because it’s usually not up to date and will need some cleansing and organizing.
Development is a never-ending process
It’s important to remember that development shouldn’t stop after you’ve gone through with the process. You should rather think of it as a “never-ending” development process to make sure you always keep your competitive advantage.
You could also be interested to read the ‘Supply Chain Transformation: The Complete Guide’ for more in-depth guidance with a lot of practical tips along the way.