Do you know if your supply chain is helping or hurting your business goals? If you think it’s the latter, it’s time to review your business goals, your supply chain strategy, and how they fit together. The biggest mistakes any supply chain manager makes is keeping the chain and the businesses goals separate. A supply chain is a catalyst for the results you want to get in your business, so it should be included in the business strategy. With that being said, here are five tips on how you can develop a supply chain strategy.
Supply Chain Strategy Development Tips
If you want to make significant improvements to your supply chain strategy, you examine it from the top down. Although this task seems tedious and time consuming, it’s going to reveal areas of improvement that will most likely improve profits. Here are the five tips:
Tip #1 – Connect Your Business Plans and Supply Chain Strategies
If you can do this initially, it means you’ve got enough overlap to make sense of how your supply chain actually affects your business. If you struggle to see any correlation between supply chain success and business success, you will need to do some deeper work.
Remember, a supply chain and a supply chain strategy are big concepts that overlay the entire process. Logistic strategies within your supply chain are where you or your colleagues will get into the nitty-gritty of things. This is where most improvements turn up increases in profits. Nonetheless, you may be able find ways to realign your supply chain management metrics to better serve the company goals, which, in turn, produce a better profit.
An effective supply chain management strategy enacts systems that better address common hurdles like the following:
- Strategic challenges
- Economic pressures
- Government regulations
- Operational obstacles
Tip #2 – Analyze Current Supply Chain System and Strategies
Once you have a general overview of your current system, the first step is to determine where there are problems, if any, with your current strategies. As mentioned in the last tip, this is where you get into the trenches in relation to logistics and individual participants like manufacturers, suppliers, and more. In most cases, it’s tough to get enough distance between you and your system to identify the problems. It’s usually best to hire a third party company with no bias to analyze your system. Here’s what you should expect from these professionals:
- In-depth System Discovery Process
- System Analysis Feedback
- Solution Recommendations
Tip #3 – Involve Colleagues and Third Party Participants
Typically, supply chain deterioration is due to a lack of communication, which usually stems from a lack of transparency. When you involve various people along the supply chain in this analysis process, you will surely find the problem areas quicker and be given multiple solutions from various sources. Here are two goals to strive for when developing a successful supply chain strategy:
Hire/develop a group of supply chain management professionals that will work together to achieve the business goals through the supply chain.
Stress the importance of and the execution of transparent communication with all parties involved in the supply chain.
Tip #4 – Choose A Solution
Preferably, you want to choose the optimal solution to your supply chain problems. You’ve analyzed, collected data, considered opinions, and developed a team to successfully operate the supply chain. Now it’s time to tie it all together and put it in motion. You want to choose a strategy that resolves your current problems while offering a way to satisfy your customers at a profit.
Tip #5 – Implement Strategy
Most will think that since they spent so much time analyzing, gathering, and planning that implementing the plan is like flicking a switch. All the pieces are in place, and all they have to do is turn the system on. Unfortunately, this is not the case. You need to implement the plan and continue to analyze the system you’ve created. Here are some ways to do that:
- Collect supply chain feedback
- Create reports to monitor system
- Communicate with C-Suite
- Implement the plan in phases
- Adjust system plan as needed
Use United Global Sourcing Instead!
UGS connects businesses to global sources to better serve their supply chain needs. We vet and validate all of our associates in the supply chain industry so you don’t have to. Want to develop a strategy with a third party? Contact United Global Sourcing today!