4 Supply Chain Strategies you’re missing out on, yet they’re sitting right in front of you.
It’s time to leave the apartment to a friend’s birthday party.
My girlfriend and I are already running late, the bus runs every 30 minutes, it takes 5 minutes to walk there, and we have only 7 minutes left.
“Where’s my keys?” I bellow frantically, in the hopes that my girlfriend had seen them somewhere. Ruffling around in the drawer of our hallway’s bureau, I start flipping over every piece of paper and gum wrapper that could be covering them.
From the frame of the doorway I hear a sigh of discontent, and seconds later I see a darting hand reach in front of my face.
“Here,” remarks my girlfriend completely unenthused.
The keys were sitting directly on top of the bureau, directly in my line of vision, directly in front of my face, but I couldn’t see them. I was so incredibly fixated that they were somewhere else, so incredibly focused on looking in the less obvious place that I had lost sight of the obvious.
I know I’m not alone in my sharing of this personal anecdote. Whether it’s a wallet, keys, hairbrush, or cellphone; 100% of the individuals reading these words have experienced this exact same moment of looking frantically for something that’s right in front of your face.
As often as this situation can arise in an everyday-personal capacity, it’s equally as likely to happen in a business-professional setting. We as professionals sometimes get so caught up in what we’re doing; solving the trivial problems of today so tomorrow can be manageable. But in the end, we lose sight completely of long-term solutions, which is a real shame because sometimes, the answers are sitting right in front of us.
This is: 4 Supply Chain Strategies you may be missing out on.
1. Accepting the Digital Transformation of the Supply Chain
Recent projections have shown that Supply Chain tech’s market value will reach $13B this year and is on pace to exceed $19B by 2021 (Supply Chain Digital 2017).
This trend is present for good reason.
At a time when stakeholders demand for transparency, traceability and sustainability is at an all time high, global brands have turned to technological advancements to cope. Integrating daily supply chain operations, educating less tech-savvy management teams, and adjusting strategies to match the capabilities of continuously emerging SCM tech is a great task for any organization, but a necessary one.
Digitalization of the supply chain is a movement that has cultivated not because of an acceptance of supply chain technology, but a disruption of supply chain technology. This is not the time to ‘feel out’ the disruptive technology of today, it’s the time to embrace and adapt with agility.
The graphic below gives some further suggestions on the kinds of digital integrations organization can benefit from- investing in tech implementation.
To list them out, these are some of the trending technologies of supply chain management, year 2017:
IoT, PLMs, SRM, Chatbots, Uberization, AI, Machine Learning, Automation and Robotics, Self-driving vehicles, Cloud integrations, Big Data Analytics, 3D Printing, Blockchain Technology (forbes.com).
2. Leverage Supplier Competencies
The importance of increasing supply chain visibility lies within creating a basis of transparency and trust in the relationship between your organization and external suppliers (in support to the first strategy listed; digital integrations can aid the obtainment of supply chain visibility).
Building trust in this relationship can transcend the collaboration from a linear model to a more circular model; one that focuses on creating shared value. Before this is possible, the risk management of a supplier relationship must be vetted so that collaboration can ensue with a high resilience to supplier-related risks.
The model above is a simplified display of how Supplier Enabled Innovation can be utilized to optimize and enhance the top-line value of your organization through leveraging supplier competencies. With a proper blend of influence/development, common interpretation of values and goals, and utilization of technology and innovative thinking, your organization can aid the acceleration of external supplier performance.
“The suppliers themselves have in the most part always been innovative. They have to be in order to remain in business and increase their market share. The trick however for companies at the top of the supply chain is recognizing this innovative trait, and plugging into it.” (supplychainstation.com)
3. Strong Supplier Governance and Compliance
“Governance represents the structures and processes by which societies share power, also shapes individual and collective actions” (Eltantawy 2011).
I’m certain that your supply chain management strategy involves actions for creating a basis of supplier compliance to meet the standards of your organization.
But, is your organization governing suppliers efficiently?
In order to assure that suppliers are working within acceptable parameters of production, buyer entities must take measures to gain some level of certainty. Most organizations choose to assess suppliers, audit them if need be, and evaluate their progress and performance.
In reality, the process should be an aggressive assessment of suppliers, and external risks that suppliers may be less resilient towards (country related, financial and/or geopolitical risks). After the assessment process, suppliers should be compared on potential for performance within the guidelines of price, but also in regards to sustainability and their ability to perform in line with a purchasing entity’s corporate values. After a supplier is selected and collaboration ensues, internal and external audits should be an action of commonality. Rather than ad hoc auditing, supplier audits should take place yearly and sporadically. This way, disingenuous suppliers won’t have the time to hide damning aspects of their organization’s functionality. After this, thorough reviews and evaluation of suppliers should ensue, but again, keeping in mind sustainability, quality, ethics, and profitability (Notice profitability was the last parameter for evaluation. There’s nothing profitable about collaborating with suppliers that utilize child labor or have poor living conditions for workers.).
All in all, governance should be an active, but more importantly, aggressive action within supplier relationship management; aided by technological advancements to streamline the process as much as possible.
4. Seek out Gender Equity and Diversity in Supply Chain Roles
Supply Chain professionals are a group of individuals crudely imbalanced within ethnicity and gender.
Still today, older Caucasian men dominate the profession, while persons with ethnic backgrounds, women, and younger supply chain professionals get the short end of the stick.
Pidgeon-holing supply chain management teams to a bunch of old white men, is certainly the wrong direction to be moving in, year 2017. The issue, of course, is a question of a much larger systematic fallacy that women and people of ethnic backgrounds aren’t equally as qualified as white men. These are the groups that have become oppressed, outside of the “norm” of society, so to see them marginalized in supply chain management positions isn’t surprising, but it is certainly disheartening.
“As Kevin Shriver of Land O’Lakes said on a panel, if more than 50% of the population is women and less than 20% of the people in senior supply chain positions are women, then by default we cannot be hiring the most talented people. This gets us back to the issue of the characteristics that we look for and the criteria we use to select people” (kinaxis.com).
Characteristics associated with male and female leaders, are of course, figures of societies creation; perpetuations of prejudices and stereotypes. However, these same stereotypes have been an unspoken barrier women must scale up and over before they are accepted in the community of supply chain professionals.
Organizations globally must work actively to balance- the imbalance with equality programs during hiring processes and board selections.
What have we learned?
You have the power to change enhance the performance of your supply chain, and you knew all of this information.
Sometimes you just need a really irritated girlfriend to show you- what you were looking for has been right in front of you the whole time.
Until next week.
This publication is brought to you by author Sam Jenks, but also on part by Kodiak Rating — A Supplier Relationship Management SaaS functioning out of Stockholm, Sweden. Kodiak Community intends to challenge traditional business practices with innovative thinking and creation.