Whether you're a large or small enterprise, there's no denying that supply chain management (SCM) has directly or indirectly paid a major role in your business’ success.
But, for your business to scale further, can optimizing SCM open pathways to profitability and increased customer satisfaction? What are the best practices for optimizing supply chain management?
First, it's important to understand what supply chain management is.
What is supply chain management (SCM) and why does it matter?
SCM refers to those crucial activities that your company heavily rely on in order to ensure your customers receive your goods or services in a timely and efficient way. Depending on your niche, such activities may include manufacturing, transportation, farming, designing, etc.
What does supply chain optimization mean?
SCM can be a very complex process and optimizing it means managing a supply chain in the most efficient way possible - to better manage your operation and logistic activities.
Even though the cost of optimization in SCM is a vital consideration, supply chain professionals look at the end goal which is to enhance end-to-end visibility and boost efficiency. This could mean leveraging supply chain optimization software, tools, technologies, networks etc.
3 Best practices for optimizing supply chain management
There's no doubt that SCM is a vital part of every business, either big or small. So what are the best practices used by successful companies?
Set up and support your supply chain team
Setting up and supporting your support team may be one of the best ways to optimize your supply chain. While your supply chain team handles activities such as production, purchasing, contract management and customer satisfaction, it's vital to support them. You could for instance compensate the best performing employee in your team or automate how your team members communicate.
About 79% of large companies report that their main worry in SCM is the lack of technology for automation. Automation is important as it ensures appropriate, detailed and accurate reporting of data to your supply chain team. Demand Solutions has SCM software solutions that can help automate data collection and make supply chain optimization easier.
Communicate well with your suppliers
Every successful company is successful due to how well it relates to its customers. But, your relationship with your suppliers is equally vital. You need suppliers to provide you with resources for your goods or services. The better your relationship with suppliers, the more valuable your company will be.