Efficient supply chain foundations are built much like a building. Supply chains foundations are set to make them strong and reliable. Without a strong, set foundation buildings would crumble to the ground in the first hard wind. Everyone knows about foundations and if your house wasn’t built on a sturdy one, you would make sure that was fixed. Well then, why is it that this is the only time we are worried about the foundation under our feet? When it comes to a company’s supply chain foundation, there should be the same mindset when looking at the efficiency of their process. Each step needs to have its own strong foundation or it too can crumble at the first sign of trouble.
Supply chain foundations need to be designed with the same precision as a home or high rise. With a foundation comes strength, durability, and safety. Once that foundation is in place, pillars must be put up to support the weight of any future add-ons. The issue with most supply chains today is there is a strong beginning foundation but expansion is being supported by weak pillars. Weak support will never allow for future progress because with added weight everything has a larger chance of crumbling.
Visibility, Measurement, Risk Management, and Timely Execution
Just like any great building there are at least 4 pillars that should be in place to give you the ability to grow. In a supply chain, there are visibility, measurement, risk management, and timely execution. These form the basis of an efficient supply chain foundation that is strong enough for growth.
Supply Chain Foundation – The Impact of Society
Today’s buying motive is price; this is affecting our ability to measure the value of each product or service. We are trying to demand the best service with the lowest price, but how’s that working for us? Technology we receive doesn’t work right out of the box, everything we actually wanted is sold separately, and getting the best price means sacrificing somewhere else. A price should be weighed on the strength of the company’s pillars and on the growth it will give their company.
With government cuts and the continuously unstable US economy, it’s time to start taking a deeper look into what you are getting for the price you are paying. Today something catastrophic has to happen before people will actually take action. At that time it’s too late and the damage is already done.
Supply Chain Foundation – Call to Action
Don’t wait, take action today and pay a little extra to get what you deserve. Spending a little extra with the right freight provider or logistics firm could save you hundreds of thousands of dollars down the line. The assets they offer such as, new technology, better communication, and larger carrier networks, would cost more to implement from scratch then the small increase in cost per shipment.
Remember that having a strong, efficient supply chain foundation will allow for expansion of the company. Whether expansion is into new markets or to new customers, this is a positive direction. Key performance indicators (KPI) can help you in figuring out whether or not these pillars are in place in your company and how strong they are. If you do not have KPI’s in place, now is the time. The majority will wait until tomorrow to figure this out while the minority will take action today and reap the benefits. It’s time to change the culture of our buying motive and start getting what we need instead of what’s cheapest.
Additional Reading on Supply Chain Foundation
10 best practices you should be doing now
About the Author, Tony Ferreira
Tony Ferreira is the Shipper Sales Represenative at Matchmaker Logistics in Wilmington, NC. Tony specializes in Supply Chain analysis, Freight management, and Logistics improvements. He has written for online leadership publications and spoken for motivational venues both social and industrial. Tony is certified in Value Based Selling and working on his C.T.B certification. Feel free to contact him at: [email protected]