How to Overcome These 5 Supply Chain Challenges
Supply chain managers have always been faced with a unique set of supply chain challenges, it’s something they deal with on a daily basis. However, if we fast-forward to 2020, they are now facing a dramatic increase in the difficulties involved in not only creating but also retaining efficient, effective operating methods in times of distress.
The issues have increased tenfold as the global supply chain has been faced with the continuing effects of the COVID-19 pandemic. The current strains on supply chains are far more intense than they have been in the past, and effective management requires a strong plan, vigilance, and constant assessment of weak links. Generally, there are five major areas of concern when it comes to issues within the supply chain. All of these concerns present hurdles that can be difficult to achieve without a strong team and an even stronger strategy.
In fact, many supply chain managers are finding that partnering with a reputable and experienced 3PL is the best way to go. This is increasingly becoming the case as most businesses are now looking to shift a large portion of their business to an online model and embrace newer technologies. This is where Redwood can help with the implementation of software such as RedwoodConnect 2.0. To learn more about how Redwood can help you face your biggest supply chain challenges, reach out to our team here.
Customer Service and Client Expectations
All businesses rely on excellent customer service to be successful. In fact, customer service is at the center of supply chain management and is one of the biggest overall supply chain challenges. The most basic expectations that need to be met as a supply chain are delivering the right product, in the right quantity, to the right location, and on the right timeline. As simple as that sounds, there are dozens of moving parts in that simple transaction, and just as many opportunities for something to go wrong.
One-size-fits-all offerings don’t work in this setting. Consumers need options, and customization of services has become the norm. With these aspects in mind, the best way to ensure that customer service needs are met is with clear, open channels of communication.
Communicating as much as possible through access to data, visibility of the supply chain in motion, and accurate up-to-date information is key. Utilizing technology that allows clients to address and respond to shifts and changes in real-time will lead to greater customer satisfaction. Companies that invest in systems that increase visibility and simplify data are preparing themselves to meet customer service challenges head-on, and prevent many potential issues.
Globalization and Cost Control
Cost control, which is always a bit of a challenge, has many facets where issues may arise. Thanks in large part to rising fuel and freight costs and a greater number of global customers alone, managing transport costs can be demanding. Add in increasing labor rates, new regulations, and rising commodity prices and you’ll find that operating costs are almost uniformly under intense pressure. This is all prior to the delays and other issues caused by the recent global pandemic.
As with customer service challenges, visibility and technology can provide the solution here. Oftentimes, businesses struggle to apply outmoded processes and technologies to global supply chain operations, and these existing systems are frequently incapable of meeting more modern demands.
For example, let’s say there is a company that needs to reroute an inbound container shipment due to closure or restrictions that are currently in place but has a lack of visibility into the overall system. Suddenly, this simple decision to redirect a shipment from one port to another becomes a problem that causes issues across the supply chain. This only results in higher costs and decreased efficiency.
Technology, streamlined systems, communication, and flexibility allow a company the ability to quickly see the cost and service implications of every decision. Using technology to optimize systems leads to reduced costs, and in a globalized system, this is particularly important. The key is having a plan and executing it properly.
Planning and Risk Management
Planning and risk management means accounting for, and responding to, changes in the global market. Events and factors like political agendas, credit availability, pandemic events, consumer demand, global sourcing, and new product launches create major shifts in the markets- and the supply chain is immediately affected.
This is where planning, review, and assessment become key. In order for companies to stay as efficient and effective as possible, regular reviews and reassessments of the market and plans for contingencies must be evaluated. Major risks to operations must be identified and quantified in order to control, respond to, and mitigate them. Having a risk management plan for how your company reacts to and overcomes major disruptions to its supply chain will allow your response to minimize damage to the company and be back at peak functioning more quickly.
SRM, or Supplier Relationship Management
Now more than ever, it’s important to create, understand, and follow mutually agreed-upon standards when it comes to the relationship between your company and your suppliers. This allows for the most effective management of expectations.
Clear communication about current performance, as well as opportunities for improvement, issues that arise, and having consistent values are also reliant on mutual standards. Communication and E2E visibility, as with the other major challenges, will be your allies in maintaining a healthy dynamic between your companies and your partners.
Finding The Right People to Help Tackle Your Supply Chain Challenges
There are a few last challenges that all businesses face to some extent…
- Having the right talent on hand to manage the supply chain effectively
- Being attentive to cost control and globalization issues
- Utilization of technology and streamlined systems to plan for risk management
- Upholding customer service standards supplier relationships is everything.
To achieve all of the above, you will undoubtedly need the support of a solid team or a 3PL.
Here at Redwood logistics, we believe in the motto of ‘Connect to Win’ and we know that building the proper connections to succeed in business is reliant on people and the tools that empower them. From our RedwoodConnect 2.0 TMS platform to RedwoodInsight, we have all the bases covered and a team of experts ready to help you put them to use to tackle all your supply chain challenges.