In search of the balance for speed, price and quality, supply chain managers should build supplier portfolios that provide alternatives in the event of shortages or other catastrophes. According to Business Standard, alternative supply chain management solutions should always be on the ready for critical suppliers and parts. In the event of the unforeseen, such as a shortage of key materials, supplier bankruptcy and tariff and currency risks, supply chains must be able to instantly switch to alternatives within their portfolio to keep things running.
Business Standard cites a few of the unique ways companies have factored uncertainty into their supplier strategy.
- A global tire manufacturer built up supplier connections in multiple regions and developed contracts that allowed for quick switching between them. This provided the company with arbitrage gains by making supplier changes when it was most advantageous to the company.
- A car company invested in a lanthanum mine to increase supply of the rare earth element. Despite its abundance, lanthanum's practical uses in hybrid cars are new, so the element was not being mined fast enough to meet the auto maker's demand.
All Points of the Supply Chain Must Adapt Quickly
Supply portfolios are just one example of the versatility of the modern supply chain. Automated data collection software is also allowing manufacturing and distribution organizations to make real-time updates and changes to the supply chain.
- Barcode scanning software: Supply chain managers now have access to mobile data collection software, which provides advanced tracking and inventory control. Mobile data collection mines more information about production and for ERP systems as a whole.
- Inventory control: Automated data collection systems and barcode scanning software can supply real-time data related to inventory. The data collected for inventory, along with that from other segments of the supply chain, can help managers decide when they should visit their supplier portfolios to improve production.
- Improving compliance: Organizations can better manage recalls and other compliance issues with an automated data collection system that integrates with ERP. If a supplier within the portfolio notifies the company of faulty parts or materials, real-time data collection can help track down merchandise within the supply chain that needs to be recalled and alert customers who may have already taken possession of the order.
- Increase working efficiency: Automated data collection can greatly reduce the number of repetitive steps that workers must perform to complete their jobs. Additionally, cutting back on the errors that result from these repeated steps can save money and production time.
The Time to Integrate New Systems is Now
While technology has improved in adaptability, it has also decreased in price. The savings supply chain managers can achieve by utilizing automated data collection systems far outweigh the costs. Software provided by RFgen integrates directly into existing ERP systems, which means minimal down time and technological infrastructure improvements. As companies move to become more adaptable - such as by building better supplier portfolios - automated data collection will play a pivotal role in improving the supply chain.