8 Ways How Global Supply Chain Management Can Help Your Business

Category: Business

Global supply chain management entails creating and managing a worldwide system for businesses to produce and distribute products/services. For a few decades now, several industries have been outsourcing labor and raw material from developing countries with lower resource costs to achieve cost and time efficiency. The main objective of global supply chain management is to integrate the entire supply chain function as a whole, including the international networks of manufacturers, vendors, warehouses, transportation companies, distributors, and retailers while maintaining the optimum level of service and obtaining higher efficiency and profitability. Some of the other key objectives include reducing the time required for order fulfillment and increasing flexibility while dealing with multiple vendors across the globe. It incorporates strategies that facilitate firms with the right type of raw materials and deploy processes to ensure that the goods are sourced, supplied, produced, and shipped at the right time and in sound condition. Three elements that constitute an effective Global Supply Chain A fully integrated supply chain requires focused efforts from every department of the company as well as collaboration with external suppliers and vendors. It needs to have a multidimensional approach with three broad focal points - people, processes, and technology. People - Employees form the core of any organization. In order to achieve optimal global supply chain management companies need to hire or train people with the right skills and knowledge to be able to manage various functions with ease. It has also been observed that people work best when they’re aligned with the business’s strategic vision and are aware of their role in fulfilling it. Processes - Processes form the backbone of supply chain planning as they integrate people and systems to collaborate and take actions that ultimately benefit the supply chain. Processes also include the functions performed by external companies that are part of the supply chain. Technology - Technology is the thread that connects the people and processes in the supply chain in a way that ups productivity. However, technology is only as good as the people who’re trained to benefit from it. Therefore, a careful selection of technology and resources is crucial to the success of supply chain management for manufacturers. 8 ways Global Supply Chain Management can transform your business Developments in communication and transportation technology have created a global marketplace from which companies can source a steady supply of goods at the lowest price possible. This has pushed the need to conduct business that is not bound by geography or any other boundaries. Improve Overall Efficiency Smaller businesses often have a resource and cash crunch, which limits their ability to innovate. Global supply chain modules establish a system that enables end-to-end global supply chain visibility and give businesses an opportunity to innovate and expand without huge investments. It also enables them to predict demand and supply products accurately with the help of demand sensing and demand forecasting technology. This makes supply chain management indispensable in order to perform well in a volatile market. Manage Inventory Accurately Fluctuating customer interests poses a challenge to inventory management for any firm. Businesses need to keep all relevant inventory available without incurring huge holding costs and at the same time remain flexible enough to meet customer demands. Lack of inventory adds undue pressure to production cycles and at times, even costs the company its reputation due to delayed or failed orders. With efficient global supply chain management, companies can predict demand and manage supply with utmost accuracy. Optimize your Shipping Mediums Customers today want everything shipped to their homes, and they want it shipped fast. Without a solid shipping plan, companies can lose out customers and opportunities that are crucial to the growth of a business. Supply chain management in the manufacturing industry involves systems that help companies determine the best way to ship products that are economical, safe, and quick. Manage Risks Better Mitigating risk is an everyday affair for growing businesses. However, with the help of supply chain management, businesses can predict all risks pertaining to the industry and be better prepared to tackle them. Whether it is about an upcoming scarcity of raw materials, product compliance, or safety, an effective supply chain system can help predict and tackle most of these challenges. Manage Demand Better Today’s supply chain planning takes into consideration shorter product life cycles, fluctuating economies, and emerging markets in order to make sure that businesses adequately respond to shifting consumer demand. It does so by increasing the flexibility of the supply chain so as to enable the management to respond to rapidly shifting external events, such as the actions of competitors and changes in customer demand. Minimize Wastage of Resources There has been an increased focus on sustainable business practices worldwide in the past few years. Businesses are becoming more and more aware and concerned about the amount of waste they produce. Supply chain management incorporates lean practices that help companies identify their areas of maximum waste creation. Focus on Customer Service Any successful business can be characterized by excellent customer service. After all, customers are the ones who determine a business’s success and longevity in the market. Investing in supply chain management not only improves your go-to-market time, but also improves the overall delivery experience. It helps you manage customer demands better by means of bots, virtual assistants, and so on. Reduce your Overheads Newer businesses have trouble identifying the scope for cost-cutting without affecting the overall production quality. Supply chain management platforms help cut costs in the production process without compromising the quality or deliverability of the product. It helps in identifying operations that are unnecessary or can be automated, thus saving your money and time. Disintegration functions can seriously bring down the quality and pace of service delivery in global supply chains. Finding the best industrial manufacturing facility, sources for raw materials, labor, and shipment requires expert assistance in global supply chain management. Get in touch with an expert if you wish to produce quality products at affordable prices!