Best practices to improve Supply Chain productivity
- 5 April 2018
- Written by: Yves Bemelmans
- Category: Supply Chain
The supply chain is now increasingly viewed as an essential determinant of competitive advantage. Organizations have realized that their supply chain is much more than the cost of getting products into consumers’ hands. Companies have recognized the importance of the supply chain in translating corporate strategy into daily interactions both within and beyond the organization. At the end of the day, it is the supply chain that satisfies or upsets customers.
Ensuring supply chain productivity starts by fostering communication within the supply chain, and keep up with it in the long run, with a high expectation for progress. The key is to adopt an ongoing learning process for both employees and the management to ensure the improvement of processes, products, and services. Besides, a performance-driven culture will lead to more savings, enhanced service levels, and a motivated team of talented employees.
Here are best practices to improve supply chain productivity:
- Opt for a Powerful Training Program
Better supply chain productivity is reached through a top down approach; it’s all about leadership. It is the responsibility of leaders to communicate effectively, set procedure standards, define a hierarchy of importance, empower employees, and derive an efficient training program. Together, the management and employees can create a performance-based culture within the company and its supply chain.
With the advent of modern learning solutions such as e-learning, webinars, simulations, scenario-based video training, gamification etc.; global organizations have increasingly opted for such training programs due to their accessibility and flexibility. Employees proved to be more engaged, productive and motivated. This is mainly because of the level of interactivity in the courses which allow employees to actively apply what they are learning in their day-to-day jobs.
- Efficient Communication
It is important to define organizational goals and the methods to achieve those goals through clear and concise communication to employees. This is critical to a supply chain’s operations and productivity. One way to maintain efficient communication is by scheduling daily and weekly meetings dedicated to co-operative problem-solving. In this way, the management is able to take the necessary actions to improve performance. Such measures ensures unity and understanding of productivity and operations that will ease open communication between employees and management.
- Differentiate your supply chain and corporate strategies
No matter what your business strategy is: superior service, product innovation, or cost leadership – you need to ensure your supply chain is helping to deliver the key points of that strategy. To make this happen, you can bring together leaders from across your business to define the supply chain that will work for you and make sure they provide the data your organization must deliver. For instance: the marketing department should tell you what your clients value most from your service, how those needs vary among customers, and what will differentiate you from your competitors. Hence, with such a collaborative approach, your business can find means to create original products that corresponds to the needs of all those consumer groups while paying attention to cost control.
To progress as a business, it’s vital to constantly adapt to emerging technologies in order to stay ahead of the competition. Modern technologies will allow your company to boost productivity by reducing costs and improving customer satisfaction. A business that regularly has shipping delays, shipping errors, or products that are out of stock will definitely turn off customers. Improving your supply chain with technology can reduce risk and improve your company’s goodwill. From suppliers to customers, technology can facilitate the entire supply chain functions.
- Use the right key performance indicators
It is essential to give incentive to your supply-chain organization to work in ways that deliver the most value for your business while protecting against its biggest risks. This implies the use of more than the traditional metrics of cost, service, and capital. The right key performance indicators depend heavily on the needs of the business, the product, and the market segment.
- Develop a distribution strategy
A good distribution strategy is fundamental to the supplier management framework. It helps to reduce product decay, while improving the customer service. The broader field of supply chain management can help an organization to establish long-term financial stability. Reports have shown that devising a good blueprint for distributing your products and services will help in achieving profitable growth, particularly when corporate managers strategically think about cost, revenue, and asset utilization.
While making your distribution strategy, keep a close watch on issues like production facilities, cross-docks, warehouses, and above all customers, along with number, location and the network of suppliers. Set a proper goal for your distribution. Put in place tactics in sync with your overall supply chain strategy. For instance, if you want to get an industry award for timely delivery, find out all major stakeholders i.e. production supervisors, delivery teams etc. for the essential process to improve.
The best companies have transformed their supply chains with time, investment in good training and development programs, and sustained top-management attention. What are you doing to improve supply chain productivity and turn your supply chain into a powerful source of competitive advantage?