Supply Chain Management – Strategy, Planning, and Operation

Here are a few strategies of SCM:

  1. The organization’s planning should be demand-driven and the operating model of the business should be based on real-time demand insights.

  2. The organization should build an adaptive and agile supply chain with quick planning and integrated execution.

  3. Optimization of product designs and product management for manufacturing, supply, and sustainability to accelerate profitable innovation.

  4. Aligning the supply chain with business goals. For this integration of sales and operations planning with corporate business, planning is required.

  5. Embed sustainability into supply chain operations.

  6. Supply needs to reliable and predictable. The firm should ensure this.

  7. The right processes need to be in place along with the right practices and tools.

PLANNING: Supply Chain Planning is a part of Supply Chain Management and here is how planning should be done. Out of all the leading practices here are a few important ones:

  1. Systematic management of the master data, that includes key data fields for the product, customers/clients/buyers, manufacturing resources, and the suppliers.

  2. Planning processes that are executed by synchronization of long-term and tactical planning.

  3. Collaborative processes for both important customers and suppliers. Also, reconciling forecast, orders and usage should be done regularly.

  4. Inputs should be data-oriented that focusses on the forecast including forecast errors, new products, volume variation at the end of the year etc.

  5. Focus on “point of sale” and “sell-through”

    data.

  6. A product lifecycle management process that bridges the gap between product development and supplies chain.

  7. Continuous improvement approach to understand user/customer behavior.

OPERATIONS: Operations decisions are made keeping in mind the strategic and tactical decisions adopted in a company. These high-level decisions are made to create a framework within the organization’s Supply Chain Operations.

Everyday supply chain operations ensure that the products more efficiently along the supply chain by achieving the maximum cost benefit.

MANUFACTURING: Tactical decisions are made regarding manufacturing, like the adoption of kanban and just-in-time. If the local manufacturing site is not able to rely on a particular supplier’s delivery schedule, the just-in-time method doesn’t work.

SUPPLIERS: The company makes decisions on Global suppliers and negotiated contracts so that the company’s global buying power is taken advantage of.

LOGISTICS: Strategic and tactical supply chain decisions in the logistics process focus on using third-party logistics companies. A lot of companies have identified the cost benefits of these 3PL (third party logistics) and integrated them into their supply chain management.