While the supply chain is a complex process involving various stakeholders, systems and processes, there are several ways to improve its overall performance. Companies should foster an environment that supports automated data collection and analytics throughout the process because it can boost efficiency and allow organizations to better predict future demand.
"It not only provides a means to act in the present based on the past but also provides a future outlook, improving forecasts, trimming inventory, reducing stock-outs, and optimizing logistics costs," explained Supply Chain Digital contributor Ella Copeland.
Supply chain and logistics managers should follow these four steps for improving their company's logistics process:
- Foster an environment that supports automated data collection
- Analyze data to spot current trends and predict future ones
- Encourage cross-enterprise collaboration and decision-making
- Break from process control when it hampers progress and innovation
This last point is especially important, explained Manufacturing Business Technology contributor Alan Nicol, because companies can fall into the habit of relying on a process even when it's working against them.
"I've seen it in most organizations that have a deeply ingrained culture of process improvement and process control," he wrote. "We do all the important things and drive an understanding that for us to build better processes and prevent variation and waste we must follow the process, even if it isn't perfect, so that we can at least measure it and find the problems so we can improve it."
The problem occurs when a system or process breaks from the norm. At that point, existing culture won't support the nimble problem-solving needed. Managers need to realize that if following an existing process will negatively impact customers, efficiency or safety, then the organization needs to develop a workaround or find a new way of handling the situation, explained Nicol.
Companies that can harness automated data collection, analytics, collaboration and break from process control will be well-positioned to succeed in the challenging market.