In order to keep the supply chain moving, managers must have a list of multiple first- and second-tier providers, because supply chain interruptions are hard to predict. However, having multiple suppliers does not always mean they should be located all over the world.
According to the website Supply Manager, organizations should source locally and avoid areas that might be cheap, but also unpredictable - such as countries rife with political unrest or military conflict. Sourcing close to home also reduces costs related to shipping. Ironically as the supply chain grows and expands, most companies are looking for ways to keep suppliers closer to the hip.
How 3D Printing Could Change the Supply Chain
An article by The Daily Telegraph's Business Reporter recently examined how 3-D printing technology has the ability to remove parts' suppliers from the supply chain altogether. The idea is that if 3-D printing becomes affordable enough and the machines can create items with a wider variety of raw materials, companies could make many of their own components. Assembly plants would only need access to the raw materials and could then allow the 3-D printers to fabricate the actual parts.
While a business can't source much more locally than its plant, most will probably continue to use a middleman for some time. While good for small runs or specialty parts, a couple of 3-D printers would not meet the production speed of a third-party supplier. However, that supply chain managers are considering the idea is further proof of how important an organization's suppliers are to the bottom line.
Tracking Orders and Rating Suppliers
In order to determine which suppliers are meeting expectations and which are not, managers need access to data that can help them track, trace and analyze the effectiveness of the supply chain. With automated data collection, there is almost no limit to the way that information can be analyzed in order to determine where kinks in the supply chain exist.
However new technology and changing standards for suppliers impact the manufacturing business, companies in the 21st century will need access to big data. The most successful companies will be the most versatile ones, and paper-based systems don't cut it in a global supply chain, even when the suppliers are next door.