Supply Chain Management: How Does It Work and What Are the Main Goals?
Any business that manufactures, sells, and ships products both domestically and internationally needs a reliable supply chain and logistics management system in place. A strategically structured and well-managed supply chain can help streamline and build upon various operations that are either in the development phase or have already been established within your business. Your supply chain is the backbone of your business. It guarantees that your products are manufactured, packaged, and shipped out to your customers as efficiently as possible. In many ways, a supply chain should run like a well-oiled machine. Products are purchased, sorted, undergo a rigorous quality control method, and then sent out to expecting customers.
That’s how supply meets demand. So, what are the other main goals of forming a strategic supply chain and logistics management operation for your business? Here we outline some of the ways in which proficient supply chain operations can help make your business better.
Improve Product Development and Shipping Efficiency
Well-structured supply chain and logistics management strategies have one main goal in mind: to get products into the hands of your customers as quickly, efficiently, and cost-effectively as possible. Improving your supply chain operations can help you save time, money, and resources that can be put toward boosting your business practices and customer experiences.
Build Network Resiliency
Building a resilient and impenetrable supply chain and logistics management network can help you reach your business goals a lot faster with less strain on your company’s finances. A strong and flexible supply chain network can ensure that your products are shipped out to your clientele in as little time as possible with a narrow margin for error. At the same time, a strong, reliable, and flexible supply chain network is more easily adaptable to unexpected situations. Whether it’s a global pandemic that leads to border closures or diplomatic issues in other countries, you should have a feasible backup plan in place to ensure that your shipments are reaching their intended destinations, even if there’s a slight delay.
Excellent network resiliency strategies also ensure that you can reliably track each shipment and provide updates for your customers in real time on their whereabouts and status.
Improving Service Quality and Quality Control Methods
Customer service and quality control are two of the main cornerstones of running a successful and reputable business. By creating an efficient and reliable supply chain network, you can ensure that your customers are always satisfied with your service and the products you provide to them. Without a stringent supply chain system in place, distribution centers would be chaotic, disorganized, and impossible to manage on a large or even a small scale.
Instituting strong quality control methods can help you better manage your inventory and guarantee that every product that leaves your warehouse is the absolute best that you have to offer. Of course, the supply chain network doesn’t end at the warehouse. Producers, vendors, warehouses, transportation companies, distribution centers, and retailers are all part and parcel of a successful logistics management system. Each of these entities play an important role in delivering your goods and services to your customers, both individually and as part of the bigger picture. Therefore, they all need to do their part to incorporate top-notch customer service and product quality control methods that are representative of your company values on every level.
Enhancing Organizational Responsiveness
Understandably, there are certain unprecedented and unexpected events that can cause service and product delivery delays. These events are obviously out of your control, but that doesn’t mean you should neglect to have contingency plans in place. A well-thought out supply chain and logistics management system can help enhance organizational responsiveness even in tough economic times to help your company navigate uncharted territory.
Regardless of the size of your business, providing excellent customer service and answering all of your customers’ questions and concerns should be your top priority at all times. Even when you’re completely overwhelmed with customer inquiries, you should treat each one with equal importance. Building a robust customer care team accompanied by in-depth online tracking platforms is an excellent solution to this problem. It allows you to keep track of each ticket inquiry and make sure that each one is answered and resolved in order of urgency.
Creating More Stable Production and Distribution Lines
Successful supply chains start at the production and distribution line. It’s absolutely crucial to ensure that your inventory—whether it’s mass-produced or limited edition—is being produced in a safe, well-managed, and efficient distribution center or facility. Stringent safety and quality control measures should always be in place and strongly enforced throughout every step of the production process.
Essentially, every piece of inventory should be accounted for and you need to make sure that all of your warehouse and distribution center workers are well trained for their positions. In some cases, it might even be prudent to cross-train skilled workers who are at a certain level of seniority. As workers gain more on-the-job experience, you should encourage them to expand upon their skills by taking on more responsibilities and incentivize them with salary raises as they climb the corporate ladder.
The more you prove to your employees just how much you value their hard work, tenacity, and dedication to helping you grow your business, the more they’ll be inclined to continue doing so.
Securing Financial Success for Your Business
What better way is there to ensure the financial success of your business than to build a strong customer base that benefits from your products and services? Making your supply chain and logistics management processes as bulletproof and efficient as possible means trying your hardest to predict the unpredictable and have contingency plans in place. The reality is that there are multiple routes that lead to the same destinations and, metaphorically and literally speaking, the supply chain industry dictates that you always try to find the best ones available to you.
Rome wasn’t built in a day and neither was your business. It takes time, effort, and planning to pull yourself up by your bootstraps. Lean Supply Solutions is here to provide you with ample logistics management solutions and planning to help you overcome any and all obstacles your business is facing. Contact us to find out how we can maximize your supply chain productions.
- Published in Blog
How the Pandemic Could Shape the Supply Chain’s Digital Future
In light of the COVID-19 pandemic, it’s now more important than ever for supply chain and logistics management businesses to transition to digital operations. Digital logistics are far from simply being the wave of the future; they have the potential to elevate your current supply chain operations to otherwise unparalleled levels. There are a lot of important benefits to moving to a digital supply chain platform, not just in the age of COVID-19, but for the overall future of the logistics management industry.
Digital logistics means improved analytics, streamlined production processes, greater shipping, receiving, and warehousing efficiency, easier communication across various departments, and above all, opportunities to identify potential production delays and problems as soon as they happen.
Here are a few reasons why you should consider transitioning your supply chain to a digital logistics platform for the future.
Digital Transformation-Derived Flexibility
One of the main benefits of switching to a digital platform for your business’s supply chain is that it allows you to engage in a much more flexible method of tracking production processes, inventory, shipments, and customer deliveries. By streamlining these processes, you can also increase production and delivery efficiency significantly which allows you to better serve your customers and provide them with up-to-the-minute information as requested.
The supply chain is constantly bombarded with an endless barrage of previously unprecedented challenges including pandemic-induced border closures, diplomatic issues between countries, and even natural disasters. There’s no shortage of potential problems—both manmade and natural—that can prevent you from getting your products to their intended destinations. A digital platform gives you the advanced tools you need to not only educate yourself about these potential issues a lot faster, but to also streamline viable solutions for these problems and be better prepared for them in the future.
The Growth of Mergers and Acquisitions (M&A)
As a direct result of this pandemic, the global economy will see an inimitable rise in mergers and acquisitions between companies. Small- and medium-sized businesses with moderate to large supply chains will inevitably struggle to survive the financial hardships brought on by the pandemic-driven closures and their aftermaths around the world. Of course, the extent of these closures varies largely based on each country’s individual response to the pandemic as well as the efficacy of those responses.
Many European and Asian countries are well on their way to getting things back to normal and slowly rebuilding their economies. Unfortunately, the same can’t be said for North American countries like the United States, which is one of the largest product importers and exporters in the world.
Since there are strict restrictions on international trade and product imports and exports, it’s estimated that many small- and medium-sized businesses will be acquired by larger enterprises. In some cases this can be a good thing as it allows struggling logistics management teams to recoup some of their losses and move on to other endeavours. But it can also be a bad thing for some supply chain businesses because there are a lot of predatory companies that are looking to poach small companies with digital platforms for a minimal cost and a pandemic is the perfect opportunity for that.
If you plan on merging with another company or selling your business, there are a lot of potential gains provided that you make the right call. On the plus side, it can pay off to have a more experienced entity in charge of managing the more complex aspects of your business, which gives you the opportunity to focus more on the day-to-day operations.
How the Pandemic Has Impacted the Growth of Artificial Intelligence
Artificial intelligence has been on the rise in the supply chain industry for a number of decades. In fact, the presence of automated mechanisms used to streamline various processes is nothing new. With the COVID-19 pandemic still in full swing and many workers wary about returning to their jobs, it makes sense that a lot of supply chain companies need to find innovative ways to fill in those gaps or else risk major financial losses.
Local grocery stores, discount stores, retail establishments, restaurants, and office supply depots all rely on fast, efficient supply chain operations to get their products out on the shelves, in warehouses, and in the hands of their customers. Production delays don’t just cost supply chains a lot of money; they also negatively impact the businesses that rely on timely product availability and deliveries. Otherwise, these businesses risk customer dissatisfaction and massive financial losses.
Integrating more artificially intelligent processes in the logistics management industry can help streamline production and delivery processes in a safe, health-conscious, and completely contactless way without completely eliminating the human element. Automation allows logistics workers and managements to still manage their operations from a safe distance using innovative and secure digital platforms and networks that are connected and can communicate with one another. COVID-19 may not have introduced the need for automation in the supply chain industry, but it has certainly perpetuated the notion that this is a much better way of doing things.
Increased Human and AI Interactions
It could be argued that COVID-19 is also changing the way that humans in the supply chain industry are interacting with artificially intelligent mechanisms. On a global level, automation and AI are taking on more of an active role in the logistics and supply chain industry. Human-based artificial intelligence is making big waves in the technological world and it’s especially important in light of urgent situations such as the COVID-19 pandemic.
What this means is that for the majority of the time, automated mechanisms will have full control over production line and supply chain outputs. However in times of emergency, human intervention and decision-making skills will take over and be implemented. This helps maintain a very strong humanistic element to an otherwise mostly automated process.
The Role of Lean Supply Solutions in Digital Logistics
Lean Supply Solutions is a privately owned corporation with a focus on providing innovative solutions for a large and diverse base of multinational, regional, and local companies. We also provide forward-looking end-to-end control logistics capabilities, customized technical services, IT solutions, 4PL, and consulting services by supporting major OEM assembly operations and tier-one facilities. To learn more about our digital logistics solutions, please feel free to contact us today!
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SMB Proactive Tools to Mitigate Supply Risk
Over the past few months, supply chain leaders were faced with one of the biggest challenges in their careers. Industries across the globe were forced to reformulate their logistics management protocols in response to the financial, staffing, and resource shortages caused by the COVID-19 restrictions placed by various governments. The global economy suffered immense losses as international supply chains were either completely cut off or severely restricted—some are still enduring this issue.
Unsurprisingly, small- and medium-sized businesses have taken the biggest financial hit while big businesses and well-established brands are expected to survive this health and financial crisis for the most part.
Fortunately, there are certain tools that SMBs can use to help mitigate supply chain risks and navigate through these unprecedented times. If you work in the supply chain and logistics managements industry and are treading through rough waters due to the pandemic, here are some tools you can use to help get your business back on track.
Invest in Supply Performance Software
Reliable cloud-based supply performance software is an absolute must for all supply chain and logistics management operations regardless of size. This software is designed to help you mitigate risk in times of prosperity and economic downturns alike. As the name suggests, supply performance software provides supply chain businesses with a reliable digital platform to access information, promptly communicate with employees, and offer data-driven insights as needed.
This software is an extremely valuable investment for supply chain businesses in the best and worst of times because it helps you track inventory, follow active shipments, and monitor delivery statuses even when severe restrictions are in place.
Supply chain performance software provides you with detailed up-to-the-minute analytics regarding your logistics management operations. Important metrics to make note of include:
- Product and service quality control
- Cost of shipping, receiving, and storing inventory
- Delivery and service requirements
- Special requests made by customers
With this type of technology in your arsenal, you’ll always know the whereabouts of various shipments and whether there are impending delays. This information allows you to communicate with your customers and provide them with updates in the event that there’s any kind of holdup for any reason.
Boost Security Measures
Supply chains in general are extremely easy targets for online criminal activity. Oftentimes, their online security systems are vulnerable and poorly managed. Hackers bank on the fact that logistics management companies will neglect to update their network security measures and use this vulnerability as an opportunity to intercept data sharing applications.
In fact, supply chain databases are a goldmine for online identity thieves. For that reason, you need to always be on top of your cybersecurity game, especially in times of economic disparity such as the COVID-19 pandemic. As people become increasingly desperate to supplement their loss of income, they’ll stop at nothing to make a quick buck even if that means stealing someone else’s hard-earned livelihood.
As the surplus in demand continues to grow and supply of products dwindles, it’s never been more important to protect your assets and prevent hackers from infiltrating your online networks. Hiring a managed network service can help you mitigate the risks of hackers breaking into your system and stealing valuable logistics management information. They’ll frequently patch network failures, update your virtual systems, and implement strong security measures to keep your business’s confidential information safe from hackers.
Use Technology-Enabled Services
Times of severe economic downturn can lead to severe job loss and insecurity. Unfortunately, the supply chain industry is far from immune to this phenomenon. Even before the pandemic, the industry was swiftly moving in the direction of automation. Now, that advancement is a life saver for a lot of logistics management operations.
Automating inventory and product movement is a lot more cost-effective than hiring, training, and paying a full team of employees to do the same jobs that can easily be done by technology-enabled services at a fraction of the cost. Technology-enabled services like automation can help supply chain companies save money in a number of ways, including:
- Reducing or eliminating the cost of hiring and training new employees
- Reducing the square footage of warehouses and shipping facilities
- Increasing product output versus input
- Focusing more on improving product quality and service efficiency
While it’s always preferable to hire more production line and warehouse workers, the reality is that an increasing amount of these positions have been moving toward automation for decades. On the plus side, that allows supply chain operators to expand their services and create new types of positions that are better suited by human experience and knowledge. Most notably, technology-enabled services allow supply chain owners to expand their operations to external services such as making deliveries, customer service, and overseeing product and service quality control.
Managing Technology-Enabled Services to Increase Efficiency
Along the same wavelength, installing automated applications within your supply chain operations has been proven to increase production efficiency. Due to supply shortages caused by the COVID-19 pandemic, indirect supply risks for items like toilet paper, paper towels, office supplies, disinfectants, etc. are at an all-time high.
Professionally managed technology-enabled services can help mitigate these risks and the inevitable costs that are associated with them by immediately alerting supply chain operators to potential supply issues. The faster you’re made aware of situations like this, the faster you can work toward finding and implementing the appropriate solutions.
Moreover, the instant you become aware of the nature of the problem and what caused it, the better prepared you’ll be for similar issues in the future.
Pushing through the Recession Period
Regardless of industry, the COVID-19 pandemic has forever changed the way we all do business. At Lean Supply Solutions, we’re committed to providing you with innovative and proven logistics management solutions that are geared toward expanding your operations on a regional, national, and international level. Using a unique blend of processes, world-class quality systems, and cutting-edge IT systems, we provide quantifiable value for our clients all over the world. Contact us today to learn how we can help you get through these hard times.
- Published in Blog
Top 5 Factors That Supply Chain Leaders Must Employ During Black Swan Events
Strong leadership skills aren’t just an industry-wide preference for the supply chain, logistics, and warehousing industry; they’re crucial attributes that directly or indirectly contribute to the successful functionality and execution of specific operational standards.
Preparation, experience, and foresight are three of the most important attributes of being a good leader in any industry. However, even the most experienced and level-headed leaders aren’t immune to certain strategic and unprecedented blind spots.
Black swan events can happen to anyone and these types of situations are proof that it’s essential to have a workable contingency plan—or several—in place at all times in case something goes awry. Risk potential is always prominent in business ventures, regardless of size or stature. But black swan events are a special kind of breed in their own right.
What Is a Black Swan Event and How Can It Impact Your Business?
Black swan events are characterized and defined by three unique traits:
- Total unpredictable or something that’s unforeseeable
- Having a severe impact on a person, a group of people, society, or a business
- The overpowering and often misguided belief that hindsight can rationalize the specific event in question and its impact (e.g. we should have seen it coming given the overwhelming evidence at the time of the event)
Basically, the nature of the black swan event eludes predictability and it’s therefore considered to be unprecedented, which is why we often lack adequate preparation or mitigation for such an event. By many accounts, the COVID-19 pandemic could be considered a global black swan event as it ticks off all of the characteristics mentioned above.
How to Offset the Effects of Black Swan Events for Your Supply Chain
Given the fact that black swan events are typically unpredictable and unprecedented, you might be under the false impression that there’s nothing you can do to prepare your supply chain for such an event. The responsibility of supply chain leaders is to do everything in their power to try to minimize the amount of risk incurred during a black swan event. That implies the perpetual need for several contingency plans to be put in place well ahead of time to help mitigate the damages caused by black swan events.
Here are five factors supply chain leaders should consistently employ in their operations.
Clear and Effective Communication across the Board
When it comes to running a successful manufacturing, distribution, and delivery business, the lines of communication across all channels must be clear, concise, and consistent. Basically, everyone in your organization from the top-level figureheads right down to the warehouse and manufacturing associates, all need to be on the same page at all times.
True leadership is the embodiment of a concrete understanding of all levels of your business and that includes the supply chain operations.
Black swan events demand excellent communication skills so that you can steer your company, shareholders, team leaders, and associates in the right direction and everyone knows exactly what they have to do to get there.
Awareness of Disrupting Factors
It’s a given that you need to know the ins and outs of your business and that includes your supply chain operations. Otherwise, you have no way of knowing the day-to-day challenges and shortcomings of your business.
Additionally, a lack of knowledge and awareness of these challenges can also create huge blind spots for your business, leading to a breeding ground for disrupting factors to reign supreme.
A big part of risk management is actually being aware of the types of risks your business stands to face. But it also entails being prepared for the risk and disrupting factors that aren’t always so obvious. It’s like steering a ship across the Atlantic knowing that there are icebergs out there, but not preparing for storms.
Form a Rapid Response Team for All Kinds of Events
Although it’s impossible to ever be fully prepared for black swan events given their unpredictable nature, supply chain leaders can and should form general service rapid response teams for a variety of situations.
Inclement weather, traffic delays, accidents, geopolitical conflicts, and global health crises are just some of the potential risk factors the supply chain industry faces. These are all general facts of life. But the specific situations and how local, regional, and federal governments respond to them are entirely unique.
Situation-based rapid response teams can help your team better navigate and mitigate these issues to maximize production and fulfillment during black swan events.
Empathize with the Situation
Empathy is always in high demand, but most often in short supply. Black swan events are typically high-stake situations that range from devastating natural disasters to global health crises, or even diplomatic discrepancies.
These are all high-stress situations that not only directly impact your customers, but they also have an emotional and physical impact on your team members. Keep that in mind when you’re putting together a rapid response team for your supply chain.
Business and Supply Chain Flexibility
COVID-19 has forever changed the way most businesses do business. As new challenges continue to arise out of the woodwork, your business and your supply chain protocols need to remain flexible enough to adapt to the new standards being put forth. Black swan events are unpredictable and therefore, you need a supply chain operation that can easily adapt to each new situation accordingly.
Black swan events can happen at any time and anywhere. As our name implies, Lean Supply Solutions is committed to providing our clients with the support, expertise, and logistical solutions to help them overcome the unforeseen challenges of black swan events. We can help minimize the risk factor for your business while maximizing and streamlining your supply chain productions.
Contact us today to get a free quote and learn more about our supply chain services.
- Published in Blog
How to Recession-Proof Your Supply Chain
Recessions are inevitable cyclical occurrences during times of severe economic downturn. Essentially, what this means is that recessions are the direct result of national or global events such as the COVID-19 pandemic that cause the general public to stop spending money or limit their spending as much as possible.
Supply chain companies are especially hard hit during these tough times as the demand for residential and commercial product shipments usually takes a massive nosedive. Since a lot of people have been laid off indefinitely during this pandemic, their primary goal is to save money and only spend it on essential items like groceries.
Even though a lot of businesses in Canada are slowly entering into the next phases of reopening their doors, the threat of COVID-19 is still effervescently looming in the air. And that means many supply chain distribution and management facilities have either completely halted or slowed down their production lines to accommodate the changing economic climate. While many cross-border shipments have continued through the pandemic, the process of supply chain fulfillment in many sectors has slowed down due to heavy regulations and precautions.
Here are a few logistics management tips to help recession-proof your supply chain as you prepare for the foreseeable aftermath of the current economic downturn.
Diversify Your Business and Supply Chain Partnerships
As any experienced logistics management team knows, it’s important to perform regular systematic and in-depth assessments of all of your current business practices and partnerships. This can help you identify inconsistencies, inaccuracies, inefficiencies, quality control deficiencies, and any other potential issues that may inadvertently be slowing down your processes early on.
Even a healthy and profitable economic climate demands routine business and supply chain efficiency assessments to ensure that you’re always prepared in the event of a recession.
Maintaining strong business partnerships and diversifying your professional relationships can help you ascertain better financial security during the tough times. Take the time to carefully assess the capabilities of your supply chain to deliver goods and services, the demand of your products and services during high and low times, and the quality and type of equipment used by your supply chain logistics management team.
Keeping all of this information in your back pocket will not only help strengthen your existing logistics management partnerships in the good times and the bad, but it’ll also help you establish meaningful and lucrative supply chain partnerships in the future.
Prepare Several Feasible Contingency Plans
Financial and supply chain contingency plans are essential for any business to survive a potential or incoming economic recession and evade total ruin. After a few good quarters where businesses have managed to stay in the black, many business owners seem to inexplicably develop a false sense of thinly veiled financial security that they falsely believe will carry them through the most severe economic downturn. Unfortunately, a lot of these businesses are in for a rude awakening.
Without a reliable contingency supply chain (or several) in place, you could be forced to stop production on very short notice or no notice whatsoever. Not only will you be forced to absorb the loss and financial risk involved, but in light of these unpredictable and precarious financial times, there’s no telling whether or not you’ll be able to recoup those losses in the future.
Securing a reliable contingency supply chain and logistics management partnership from the very beginning or before an economic downturn occurs isn’t just a smart business strategy; it also provides you with an alternate channel of product fulfillment, retail distribution, and manufacturing support when you need it most.
Streamline the Process through Automation
Modern technology has made it a lot easier for businesses to streamline their practices and processes through automation. By storing important information such as order details, invoices, client preferences, fulfillment and delivery timelines, etc. on a secure cloud network, you can conveniently track each order, update part and product inventory, identify potential problem areas that are slowing down the process, and make necessary adjustments automatically.
If you happen to notice an issue during the production process, automation allows you to quickly communicate the problem to the supplier so that they can quickly implement a feasible remedy and step up their quality control procedures.
Establish and Maintain Proper Communication at Every Level
One way to sidestep or mitigate potential production hindrances during a recession is to maintain strong levels of communication at every level of the operation. From your frontline production workers to warehouse managers and beyond, it’s important to thoroughly understand every step of your production process so that you can work toward finding feasible solutions in the event of an economic crisis.
Recessions are notorious for causing strategic and production-based standstills as the supply of the products and parts begins to outweigh the demand. Sometimes this process is a slow burn that can take place over the course of a few weeks or months, giving you more time to prepare. But in the case of rapid business and government shutdowns due to rising public health concerns, it can be swift and unrelenting.
Unfortunately, a recession such as the one we’re currently facing could result in a sudden massive surplus of inventory, particularly in the farming and food production sectors. What’s worse is partnering with a supply chain that suddenly doesn’t have the resources, capacity, or sufficient personnel (e.g. warehouse workers, delivery truck drivers, etc.) to fulfill orders.
Outsourcing your supply chain operations can help you mitigate a lot of these issues by placing the burden of order fulfillment responsibility on the logistics management company you hire.
If COVID-19 put a huge wrench in your company’s supply chain operations, Lean Supply Solutions can help you build up a strong, efficient, reliable, and responsive end-to-end logistics management strategy that perfectly suits the needs of your business. With an emphasis on order fulfillment, tracking, and fast delivery times, our supply chain professionals are here to help you get through the tough times.
To learn more about our exclusive logistics management solutions and to get a free no-obligations quote, contact us here.
- Published in Blog