Keys to Improving Your Supply Chain Agility
In the animal kingdom, land, water, and sky are ruled by apex predators that sit atop the food chain. Lions, sharks, and eagles, just to name a few, are able to avoid danger and thrive in their respective environments due to specialized instincts and abilities. Chief among them is a mental and physical capability known as agility. Agility is an ability to react and adapt quickly, allowing these animals to obtain critical resources in times of scarcity while staying clear of harm.
In the jungle of distribution, agility has a similar bearing on whether an organization sinks or swims. Reacting and adapting to change, adjusting operations over time (as necessary) is a given in the modern world. An agile supply chain often waits to see what the marketplace asks for and then responds by supplying the goods using very short lead times and only fulfilling the demand when it is actually known.
At Sequoia Group, we mindfully assist companies in developing supply chain agility and in so doing, have identified a number of common practices that encourage successful adaptation. Here are a few tips to consider.
Improve Your Supply Chain Agility
Be Deliberately Transparent
When supply chain goals lack clarity, it can put strain on the entire operation. Having a well-defined and published supply chain plan that is communicated effectively to employees, suppliers, and partners alike can be tremendously valuable. A concrete, forward-looking process detailing the coordination of assets, delivery of goods, and other applicable information from point of origin to consumption will clear the clouds in an otherwise gloomy distribution environment.
See the Forest and the Trees
Many organizations tend to plan their supply chain around long-term forecasts. This is all well and good as long as there is room for adjustments in the short term. The best way to accomplish this is to define and balance a set of both long-term and short-term goals factoring in your supply chain plan. This will afford you visibility as to how the short-term may affect the long-term and vice-versa.
Subscribe to the Future of Technology
Technology is the lifeblood of modern supply chain management. Not only do supply chain management technologies help reduce shipping time, enable consistent tracking, and compile useful data, but they are also essential for generating actionable forecasts and accurate trends for the future. Lack of investment in your warehouse management systems will hinder growth and ultimately, profitability.
Reinforce Your Infrastructure
Having the right pieces in the right positions reduces harmful bottlenecks in your distribution processes. Do you have different supply chain teams planning different channels? Is there a supply chain executive that isn’t part of the decision-making team for the organization, and therefore, unable to advocate for necessary changes/upgrades? If so, some strategizing may need to take place in order to improve agility.
Connect the Dots
Disconnected process data can be a huge hurdle. Successful supply chain operations that deliver the right supplies, to the right places, at the right times, and at the right prices do not work in a bubble. Rather, there are multiple stakeholders that impact supply chain processes, and subsequently quality and costs. Your supply chain must be a coordinated machine that works as one when needed rather than a set of independent parts that all move in different directions.
Clear the Hurdles
At the end of the day, every organization should ask themselves the following basic questions:
- How quickly can the supply chain respond to changes in supply or demand?
- While absorbing change, how are both short-term and long-term opportunities addressed?
- How fast can a new product be designed, produced, and distributed?
When such questions can be answered confidently, it’s likely the supply chain is well-prepared— for the time being. However, agility requires constant attention and practice or it can be lost. It’s a lot easier to keep momentum while moving downhill rather than uphill so if you find these tips useful and decide to implement them, remain vigilant in anticipation of change. We promise it will be well worth it in the end.
For additional inquiries, feel free to contact us at 801-571-2300.