Did You Do a Supply Chain Health Check?

A supply chain consists of organizations, activities, information, resources and people involved in making products from raw materials and moving a finished product or service from supplier to consumer. Since a supply chain usually has many complex components, various participants and countless products, keeping it healthy often becomes extremely difficult.

For a supply chain to be effective and sustainable, it must be healthy. Following four simple steps can perform a thorough health check on supply chains.

Defining the supply chain- Different supply chains have different requirements. Practices which are healthy for one supply chain may not be healthy for another. One should take into account the processes undergone and the people involved in making a product, before taking actions to make the chain healthy.

Applying the same practices for different products is unlikely to produce desired results. For example, in the mobile market, different devices have different specifications and are manufactured following different methods. Hence, applying same practices in the supply chain of all the devices may not be beneficial.

A joined up acquisition technique- Having a proper procurement process is extremely important. Inappropriate procurement procedures often cause problems like delivery of products to wrong locations and/or in wrong quantities. Such events usually take place due to error in available data and miscalculations and eventually make the supply chain unhealthy.

A team should be allotted the task of joined up acquisition to counter these problems. The team should take the necessary actions to make sure that the distributor is getting the right volume of stock. This is important as if the distributors don’t get adequate products on time, the customers suffer and this tarnishes the company’s image.

Sufficient data should be available- As the size of a business increases, so does the importance of data available. For keeping the supply chain healthy, a business must make sure that enough data is available at every stage and there should be a transparency of data in different components. This helps in different layers of the supply chain to work together and to develop a sense of understanding between each other.

Customers should also be allowed to access data. This helps them to know the current state of the product they want to use and accordingly weigh their expectations. Knowing a product’s state helps customers to estimate its delivery date and plan further tasks accordingly. This transparency is thus, essential for a having healthy supply chain.

Hiring skilful logistics providers- Every company employs logistics provider, but not all are efficient. Hiring correct logistics providers can greatly benefit the company. The data generated by logistics provider helps in dealing with potential buyers and gives the customer a brief idea of what the company does.

Logistics providers monitor various layers of the supply chain and maintain records of different activities taking place in these layers. These records help the company manage different components of a supply chain more efficiently.

All these methods can help businesses to perform a thorough health check of the supply chain. A healthy supply chain greatly increases the efficiency of a business and makes it better managed.

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