A company’s productivity and profitability depend on the efficiency of its supply chain.
The supply chain of a company consists of a series of activities ranging from buying raw materials to delivering the finished goods to clients.
The efficiency of each of these activities allows for optimal distribution and logistics and, therefore, a competitive and profitable company.
All the parties involved in a supply chain (suppliers, manufacturers, and logistics and freight companies) should have the same goal of delivering goods on time and form, using just the necessary resources.
This means we need to make sure raw materials and finished products arrive at our clients’ docks in excellent conditions, at the right time, and at the lowest possible cost.
This is the only way to achieve the complete satisfaction of our clients, which may become the company’s differentiating element in highly competitive industries.
How to achieve efficiency?
The following are some of the factors that affect it:
- Communication and collaboration. All the parties involved in a supply chain should share information quickly to coordinate their efforts better.
- Traceability. We should implement a system that lets participants track, in real time, the status of the goods.
- Integration. Each phase must be understood as a link in a chain that needs to be precisely connected with the rest of the stages.
- Adaptability. The process must adapt to the needs of the clients, so we can better serve them.
- Constant assessment. Set up indicators to measure results and comparison points with competitors to help identify opportunities for improvement and correct mistakes quickly.
Which goals to reach?
The efficient operation of the supply chain is the basis for a company’s productivity and competitiveness. To meet the demands imposed on the supply chain, we must reach these basic goals:
- Profitability. Lowering costs and maximizing results is key to efficiently manage the available resources.
- Specialization. Each link in the chain must work perfectly and to achieve this, it is essential to have experts who improve efficiency.
- Flexibility. A quick response to the variability of markets and to the everchanging needs of clients will guarantee customer satisfaction and result in a competitive advantage.
- Visibility. The precise monitoring of what is happening along the whole process helps us find errors and act promptly.
- Coherence and unification. The goals of each stage must be interrelated, and a complete integration must come to pass, for the process to unfold without mishaps.
- Empowerment. The involved parties must be able to make timely decisions to meet the established performance goals.
- Sustainability. The importance of the logistics process’ ecological footprint, and the ways to lower and compensate for it, should not be put aside.
How can we apply the Lean concept?
The Lean Concept is a management model that eliminates waste to reach a complete efficiency in the use of resources, giving more value to the client.
Embrace this model to meet the goal of turning your company’s supply chain more efficient:
- Get rid of unnecessary trips by paying close attention to your purchase orders and their documentation, delivering goods on time, and minding the integrity of cargoes.
- Analyze the market’s conditions to forecast demand correctly and avoid accumulating raw materials or finished goods in the warehouse, which only results in higher costs.
- Use technology to minimize staff movement, making the necessary information, materials, and tools available for them to carry out their duties.
- Coordinate activities correctly along the whole logistics process to eliminate unproductive waiting time.
- Implement quality control systems to make sure instructions are carried out properly and products are free of defects that result in refunds or delays in the supply chain.
- Plan production according to the expected demand to avoid excess inventory.
- Synchronize the activities of each of the chain’s stages to avoid interruptions or bottlenecks that slow down its operation.
If you analyze your supply chain according to these parameters and goals, you will be able to see if it is working with efficiency.
Do not focus only on looking for things to improve, document what you are doing right too so you can replicate it and reach the excellence that will set you apart from your competitors.
One of the purposes of Solistica is to make your supply chain more efficient with comprehensive transportation, distribution, storage services, and many other solutions managed at an Intelligence Center that helps you control, monitor, and optimize your logistics’ resources, lower costs, and achieve the complete satisfaction of your clients.
Talk to our experts to improve your customer service and boost your profitability.
