If you are looking for a way to improve your sales and operations planning, and there is a good chance that you are taking a closer look at your supply chain. Given that your supply chain and your daily operations go hand-in-hand, you need to have an accurate picture of what your supply chain looks like. Even though you may think your supply chain is relatively straightforward, there are a few common mistakes that people make when they manage this critical part of their business. By thinking about these mistakes now, you may be able to avoid them down the road.
Measuring Their Supply Chain By Spending
One of the most common mistakes people make when they are managing their supply chain is that they prioritize their functions by how much they spend on them. This is not the right way to go about setting up a supply chain. This practice worked well in decades past. Now, because companies have gotten so large and spread out, a lot of companies are outsourcing their supply chain management. Therefore, your supply chain probably has multiple layers all over the world. Therefore, if you rely on only a single source, your supply chain is more likely to experience disruptions. As a result, quantifying your supply chain by how much you spend on it is not the best approach. If you do not have an alternate source, then a single failure point can take down your entire supply chain. Make sure your supply chain has multiple layers and prioritize them equally.
Bringing the Supply Chain To Market Too Quickly
Another common mistake that companies make is trying to rush the development and launch of protocols and newer systems. Even though there are many companies who are looking for ways to get to the market more quickly, this also can lead to problems. For example, it is important to test the limits of new protocols and products. Otherwise, companies will end up locking themselves into massive deals. These deals may not be in the best interests of the company. Rushing the development of the supply chain can lead to major blind spots. If these blind spots are overlooked, they can lead to major problems. For example, if you do not test your supply chain, then there could be a significant delay. If you have a deadline to meet, and you do not meet that deadline, your company could suffer significantly. Take the time to test all protocols before you bring your supply chain to the market.
A Lack of Visibility in the Supply Chain
Another significant mistake that people make when they are setting up their supply chain is they do not have appropriate visibility. You need to be able to track each individual metric of your supply chain. This type of transparency is important. If you do not track the various pieces of your supply chain, you will not know what is happening to your inventory as it makes its way to you. It may also make it hard to track items when they are in transit to your clients. One of the ways that you can improve the visibility of your supply chain is to take advantage of advanced software programs. If you appropriately use these programs, you can anticipate issues before they start to cause problems in your supply chain.
Not Managing Your Risk Appropriately
Finally, a lot of businesses do not manage their wrist appropriately. Risk management is an incredibly important part of running a business today. There are numerous risks that go along with your supply chain. Some of the most important risks you need to consider include the number of days it takes to deliver your products, an increase in the demand for your inventory, issues related to your quality, problems related to your suppliers, and supply shortages. You need to have plans in place for these obstacles. If you do not think about them now, your supply chain could be severely disrupted down the road. By anticipating these problems, you can plan accordingly.
Make Sure You Avoid These Common Supply Chain Mistakes
Things are just a few of the numerous mistakes that people make when they are managing their supply chains. Your supply chain is one of the most important parts of your company. It is important for you to make sure you get it right. Therefore, take the time to develop each individual step of your supply chain. Then, test your supply chain to make sure it functions exactly as you think it should. Even though this may slow your company down at first, it can help you down the road. Then, if you set up your supply chain well, your sales & operations planning will go smoothly as well.