Improving Flexibility & Reducing Risk in Supply Chain
Effective supply chain management is of top priority in a dynamic market. And its significance to business growth has been emphasized time and again. Despite this, it cannot be stressed enough that supply chain is the lifeblood of your business. And any unaddressed issue in your supply chain can pose a threat to the very survival of your business.
This is also why supply chain experts continue to call attention to the need to improve flexibility. A rigid supply chain is incapable of adapting itself to changing market demands and legal requirements. Especially with compliance laws surrounding manufacturing and transportation of products becoming more stringent, lack of flexibility can give rise to a number of risks. However, by improving flexibility in your supply chain, it is possible to mitigate these risks to a large extent.
So, how can you achieve flexibility? A flexible supply chain is one that is transparent, responsive/agile, and reliable. And in order to achieve flexibility, the supply chain should have the potential for structural, technological and human resource scalability:
Structural Parameters: Your supply chain, whether modular or sequential, goes through different stages. And at each of these stages, there are different players whose performance may affect your product quality, availability and reach. Manufactures may remodel their products owing to market demands, suppliers may face several limitations due to regulatory restrictions, and distributors may encounter challenges in logistics and transportation. But it is important for you to ensure that these limitations do not impact your supply chain. For example, a capacity-constrained supply chain may limit product availability, and disappoint customers. So, the operational framework of your supply chain should be designed to accommodate changes that may arise at any of these stages.
Technological Parameters: Technology plays a key role in supply chain management. Although the concept of supply chain pre-dates the era of computers and internet, web-based communication and software have helped supply chains become more agile and flexible. With the internet and email entering the supply chain arena, sending and receiving timely updates, feedback and other important communication has become much easier. This is especially true with global supply chain models, where the internet has facilitated communication and procuring information. Similarly, the concepts of supply chain consulting, and use of technology solutions for supply chain management are growing in popularity. By leveraging these solutions you can create a more flexible and responsive supply chain.
Human Resource Parameters: The human capital in supply chains is always a challenge, especially with tight supply of skilled labor and increasing labor costs. But the importance of finding and retaining the right supply chain professionals is rarely emphasized. As a result, there is increased dependency on the existing human resources, which by itself is a high risk to your supply chain. For you to deal with these challenges effectively, supply chain outsourcing can be of immense help. Supply chain consulting companies offer a range of services including supply base management, fulfillment solutions, logistics and distribution, returns management, reverse logistics etc. By opting to partner with these consulting companies, you can overcome challenges with regard to human resources, and ensure a much more flexible and reliable supply chain.
Supply chain flexibility is now being considered a prerequisite to gain competitive advantage and improve business performance. And to improve the flexibility of your supply chain you need to devise a strategic model wherein you can be assured of uninterrupted flow of inventory, while also being able to focus on your core business. And supply chain consulting is the key to achieving this.
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