Five Supply Chain Resolutions for an Agile 2016

Companies need to break the rigid linear operations mindset into more flexible approaches that best use resources

Amy Clark
Amy Clark

2015 saw countless hurricanes, disasters and delays. 2016 is set to be just as, if not more, hectic. Take some time now to think about where your supply chain could have improved over 2015—did you react too slowly to an event? Did you miss the word on a closed factory? If you could go back and change a few things, what would they be? What tools do you wish you had to help you through tough times? What operational lessons can you draw from last year?

We asked ourselves the same questions and came up with some ideas to get you started—how can you refresh your supply chain to improve efficiency and cut costs?

1. Start Looking at your Workforce a Little Differently

Supply chain managers have some of the most demanding jobs out there, but it can be hard to see; after all, when they’re doing their job right, all is quiet. When one of the million variables they deal with goes wrong, they get all the heat. To address a talent shortage in supply chain, we must start by addressing the existing talent and understand the impressive scope of their responsibilities. The role of a supply chain manager touches all aspects of product development, from initial design to when it gets into the customer’s hands. It’s time to free supply chain and logistics professionals from the confines of their job titles, and revamp what it means to work in one of the most chaotic and rewarding fields in any company.

2. Focus on Agility, Not Predictability

You can't foresee every event that may affect your supply chain. Instead, you need to work on making your operations agile enough to react to events as they happen, whether it means closing down operations in a certain area, relocating them if need be or rerouting shipments in a short window of time. Companies that benefitted the most during disasters or disruptions were those that were able to react quickly. How did they manage that? By giving information access to everyone and by opening communication channels to all levels. When information needs to trickle down a hierarchy, it is nearly impossible to react to any major event. Especially as supply chains grow in size and personnel.

3. Work with your Suppliers to Utilize their (and your) Potential

Your suppliers can be more than just manufacturers of parts or products. They can help your company develop more efficient ways to design and create products, so that you can be free to imagine new manufacturing techniques. Plus, it is important to remember that you and your suppliers are on the same team. Developing a closer relationship with them can only have positive outcomes—when you both work together to create, you can both grow and achieve more than you could have alone.

4. You Have the Data—This Year, Use It Well

Loads of data can be a lifesaver or a burden. If you don’t have a way of making sense of your data, chances are that it will keep you from valuable, sometimes game-changing insights. Many companies have a lot of data (sometimes too much), but no way of sorting through it or analyzing it. There is a growing field in different enterprise software that helps companies analyze and acquire insights from such data.

Acquiring such a tool in your company’s operations would equip you to utilize the available data in order to better forecast demand, decrease reaction times to issues and locate areas of inefficiency within your supply chain. Use Internet of Things (IoT) technology to track shipments and inventory in large warehouses, and create models to track demand from multiple platforms. In short, understand what is going on in the world and within your supply chain in order to plan accordingly.

5. Replace Competition with Co-opetition

Any empty space on trucks, crates and ships is basically money being dumped into the ocean. During times when resources are low and costs are high, sharing transportation and warehouse space with your competitors can benefit both you and your customers. Pool resources with companies taking similar routes or share warehouse space during busy seasons. You can cut down on costs and optimize efficiency—plus, having a good relationship with your competitors may actually allow both of you to grow.

Bring on 2016

Supply chain practices are on the mend. As the scope and complexity of global supply chain grows, the business world is waking up to the importance and difficulty of running a resource-efficient supply chain. That means that more and more tools will be created to better share information and better streamline supply chain processes. More talent will flow into this now under-appreciated field. And companies will start to break the rigid linear operations mindset into more flexible approaches that best utilize resources at hand. All these changes pave the way for an agile supply chain in 2016.

Amy Clark works on the Elementum Rapid Response Team.