When most people think about what makes a company successful, they often consider sales strategies, marketing or employee satisfaction. While all of these are no doubt important, it could be argued that the most crucial element of a successful business is its ability to adapt to new technologies and to create and distribute products to the end user. This is known as supply chain. Marketing can convince a customer that they need a product, but if that product is not delivered in a timely and efficient manner, customers are unlikely to return.
Because many businesses are at the point that they store and distribute large amounts of product at a time, even the smallest changes in a system can have far reaching consequences. With so much riding on a supply chain, it is essential that mistakes be minimized. The following are examples of common problems supply chains face, and how they could be potentially dealt with.
Lack of visibility- where is the problem?
In our global economy, supply chains often spread across countries. As a result, companies may not understand where parts of their product are being made and how they are getting to their customers. Supply chains are multi-layered, which can create problems when something goes wrong. If a certain part of a product is being damaged for example, it may be extremely difficult to know where and when the damage is taking place.
Companies need to do all they can to increase visibility in their supply chain. They should put emphasis on identifying certain areas of the chain that seem weak and work to reduce potential inefficiencies. This may be easier said than done but it is necessary in today’s global marketplace.
Lack of accountability- who is at fault?
Like the previous point, increasing accountability in the supply chain process will reduce inefficiencies. In most companies, the responsibility of making sure the supply chain runs smoothly falls on the Chief Procurement Officer (CPO). While this is fine, problems arise when the CPO doesn’t hold anyone in the supply chain accountable. Many if not most companies fail to put anyone or any group of people in place that can be responsible to overlook operations. When problems arise, they only lead to confusion and blame rather than an organized plan of identifying and solving the problem. Not to mention, when employees know they are accountable they will perform better.
Lack of Innovation- why should we change?
Supply chain is a changing world, and companies need to adapt to new technologies to become more efficient. Recent innovations for example allow warehouses to store products automatically through a system of automated conveyor belts, scanners, etc. This saves warehouses room and time and prevents inefficiencies that come with human error. New technologies also include cubing systems. These systems can measure the dimensions, including weight and volume of a product, in a quick and efficient manner. This allows warehouses to package and send packages faster than if they were doing it manually. Despite the fact that many warehouses have used a certain method for years, change and innovation is essential in the fast paced world of business.