The Best Practices for Supply Chain Management

Today’s global supply chain is fraught with challenges and potential disruptions, whether a shortage of a particular raw material, a natural disaster, a pandemic, a labor shortage, or political unrest. However, many top companies have found ways to thrive despite these challenges.

These global giants can provide insight into the current supply chain storms and give small to mid-sized businesses creative ideas on how to repair, restore, and secure their supply chains from ever-changing internal pressures.

Here are a few things you can learn from them.

Top Supply Chain Management Practices: Self-Stabilizing, Sustainable, Human-Centric

Gartner’s top companies of 2022 are self-stabilizing, sustainable, and human centric. But what does this mean in real life?

• Cisco Systems increased their use of cloud technology through hyper-scalers in markets and operating models, with supply chain moving in alignment. They also incorporated circular concepts into the design, operations, and consumption aspect of the products and the supply chain; reduced the use of virgin plastic; improved sustainable packaging; and realized a 99.9% reuse or recycle of products returned.
• Schneider’s “self-healing supply chain” was recognized as the process/technology innovation of 2022 by the Gartner Power of the Profession™ Supply Chain Awards. They are also pursuing 70 net-zero carbon plants and distribution centers and other efficiencies across all of their nearly 300 manufacturing and warehousing facilities.
• Pfizer solved the challenge of storing the COVID-19 vaccine postproduction by freezing it at minus 75 degrees Celsius and getting the doses to the world. In doing so, they won the 2022 Supply Chain Award for Customer or Patient Innovation.

Technology Enhances Supply Chain Management

Supply chain improvements have been supported by technology in many companies. Despite technology being unable to fix a broken supply chain by itself, upgrading to an enterprise resource management system (ERM) or improving the current ERP could repair and sustain supply chain improvements.

Here are some examples of companies who utilized improved technology to boost supply chain best practices:

• Unilever adopted a different strategy to improve its supply chain management. The company, which makes everything from soap to food to beverages to personal care products, set out in 2003 to embark on an aggressive five-year growth plan. The company decided to strengthen its supply chain by relying on technology as well as involving suppliers. Their growth projections were achieved thanks to improvements in the procurement process and new leadership.
• Schneider Electric, winner of the Supply Chain Award for Process or Technology Innovation in 2022, deployed a platform that self-heals the supply chain, saving more than 100 million Euros. Through adaptive machine learning (ML), performance-related parameters, such as safety stock quantity, minimum order quantities, and lead times, are optimized on a real-time basis. The new adaptive platform uses ERP sales, purchase, and forecast data, and uses ML algorithms to analyze distributions, recommending safety stock levels at the distribution center and SKU levels in real time.

Tips to Manage Supply Chain Disruption

You might be thinking that this is all well and good, but most companies do not ship out tens of thousands of products every few seconds. However, small to mid-sized companies can learn from the big companies many techniques for shock-proofing their supply chains.

MIT Sloane Management has several tips for companies dealing with supply chain disruptions. These include:

1. Face the problem head-on. Don’t avoid it.
2. Create a crisis management center.
3. Keep the lines of communication open. Communication should be available to everyone involved with the supply chain during the disruption. Make sure you listen to the experts. Bagging the flour requires knowledge of bagging equipment, for example, while procuring wheat requires knowledge of their part of the chain. Encourage everyone to contribute their ideas and thoughts.
4. Ensure key decision-makers are in charge. They should be the people who have the most knowledge of your organization’s supply chain.
5. Keep the C-suite in the loop. Ensure that executives at the top of the company have regular check-in meetings or touchpoints, especially if they need to communicate to investors or the public about supply chain disruptions.

Use Your Company’s ERP for Data and Information Sharing

Your company can become more “shockproof” against supply chain disruptions with an enterprise resource planning (ERP) system. Your company, like the large, global companies cited earlier in the article, can leverage its ERP system to:

• Improve communications: Systems like Acumatica allow for additional users to be added on a per-user basis, as opposed to a site license. Adding your suppliers to the system allows them to give you updates on shipments, supplies, and more. You will be more prepared to respond proactively to potential stock shortages and supply chain disruptions by improving your communication through the system.
• Break down silos: ERP systems are well known for their ability to break down silos. An ERP’s data-sharing capabilities ensure that everyone can access data to make decisions.
• Collaboration: ERP systems facilitate collaboration by breaking down silos. The age-old problems of stock shortages, outages, and delays can be solved in new ways with a shared data source that allows cross-functional teams to utilize their expertise.
• Think creatively: ERP systems enable you to solve problems more creatively by providing you with access to data. In order to come up with creative solutions, you may need to think outside the box and look beyond your field of expertise. It may seem cliché, but marketing uses its marketing tools to solve problems, operations use theirs, and so forth. Using consistent data as a springboard for creative problem solving empowers teams to reach beyond their familiar “tools” to find new solutions.

Warehouse and distribution management systems can also help you improve supply chain management. Distributing, managing stock, and more can all be enhanced by these systems, enhancing your productivity and ensuring the smooth operation of your distribution system.

ASI Can Help You Manage Your Supply Chain

Managing supply chains is a unique challenge for every company. No matter who you are, whether you are a global player like Unilever or a small company, you can still benefit from top-quality ERP and WMS software to improve your supply chain. Take a moment to contact the experts at ASI today for your free consultation. We’ll assess your needs and show you the best way to accelerate your business growth, even with labor shortages.