The Answer to your Efficiency Problems
Since ancient times, supply chain systems have been used to move goods and services point of origin to their point of consumption. Key roads such as the Silk Road through Central Asia and the Spice Route over the Indian Ocean were well established, linear chains that were founded for the very purpose of moving produce from spot A to spot B. As the Industrial Revolution started to spread, the supply chain system became more efficient through specialisation to meet the growing consumer demand across the world. Countries started to specialise in the production of just one component in the supply chain, such as nails, and then sold their produce on to another company for used in their product. For example, to make cloth, cotton was grown in America, shipped to England, processed through the English cotton mills and finally the finished product was distributed around the world.
Why do I need a supply chain system?
Nowadays, the consumer outlook has changed with the introduction of technology; markets have become increasingly digitally complex and centric meaning that the supply side cost of businesses has risen significantly. As a response, not only are countries becoming more specialised, as they did in the industrial revolution, but so are individual businesses. As companies have become more specialised, there is more reliance on other companies for activities in the supply chain such as raw material procurement, quality assurance, and delivery. Supply chain management systems allow companies to co-operate with the other companies in their supply chain with ease giving all parties a greater competitive advantage.
How does a supply chain system work?
A supply chain management system can be divided into three mechanisms: strategical, tactical and operational. The strategical mechanism asks you to create a structured plan to maximise the efficiency in your supply chain. Questions that should be asked are: where will I be based? Who do I want as my supplier for each unit? How will I run my business and what do I need to source from other suppliers?
The tactical mechanism is deciding how you are going to implement the highly efficient strategy that you just created. You will need to decide who will be your supplier, how much you will need to order and what your budget is.
Finally, the operational mechanisms are the considerations that need to be made to ensure that your supply chain system will work as fluidly as possible. When should you order? How will you transport everything? These are the sort of questions that need to be asked to triumph over operational mechanisms in the supply chain.
What will I gain from a supply chain system?
Lower operational costs, ease and security are just three of the benefits that come with employing a supply chain system. With an integrated supply chain system, the computer does a lot of the work you would otherwise employ someone to do. This means the money can be diverted elsewhere like increasing the labour force. It also means the job will be completed with ease. Furthermore, as the system is all digital, there is high level of security which can only serve to benefit your business.
So, what are you waiting for? Start the road to the most efficient business possible today!