Supply chains are very common nowadays. They are created when a company makes a product from different parts that are purchased from suppliers. These products are then sold to customers. A number of supply chains are very simple, and others are quite complicated.
To make sure that a supply chain is operating as efficiently as possible and generating the highest level of customer satisfaction the lowest cost, many businesses have adopted supply chain logistics management technologies and processes. This approach is made up of three levels of activity that different parts of the company will focus on.
The decisions at this supply chain logistics management level are made every day in a business sector. A lot of these decisions affect how a product moves along a supply chain. Operational decisions encompass everything from creating schedule changes to buying agreements with different suppliers, production, moving products to the warehouse and taking orders from clients.
Supply chain logistics management tactical decisions are often focused on adopting measures that will create cost benefits. One of these measures is working with logistics companies. This will help develop cost effective transportation. At the same time, tactical supply logistics management involves developing warehouse strategies in order to reduce the cost of storing inventory. It also focuses on developing the best industry practices.
At this level, supply chain logistics management focuses on looking at high level strategic decisions. These decisions frequently concern the entire organization. This includes the location and size of manufacturing sites along with supplier partnerships. At the same time, it focuses on the sales market and products that are manufactured.
Supply Chain Management Technology
If a company expects to achieve optimum benefits from their supply chain logistics management process, they need some level of investment in the technology sector. The backbone for the majority of large companies is Enterprise Resource Planning or ERP software.
This business enterprise software implementation will contain a company’s entire supply chain. This includes everything from purchasing raw equipment to warranty services on items sold. These applications are complex, and resources and time are required to successfully put an enterprise wide solution into action. Another key to success in using supply chain logistic management is adequately training personnel to use these systems.
Today, there are a lot of ERP solutions to choose from. It is important to select one that perfectly fits the overall needs of a businesses’ supply chain. Due to the wide adoption of different Internet technologies, many businesses can take advantage of web-based communications and software. At the same time, instant communication among customers and vendors allows for timely data updates. This is very important in managing a company’s supply chain.
As a Service
Specialization and globalization in supply chain logistics management enables companies to improve their competencies. It is usually done in a manner that is similar to outsourced distribution and manufacturing. When utilized properly, it helps businesses focus on their core competencies.
At the same time, effective supply chain logistics management allows companies to assemble a network of the best partners. These people and businesses are very important in contributing to the company’s overall value chain. This effectively increases overall efficiency and performance. The ability to quickly deploy and obtain domain-specific supply chain capabilities without maintaining and developing a complex and unique competency is the main reason why this approach is gaining popularity.
Posted by LeanCor Supply Chain Group
LeanCor Supply Chain Group is a trusted supply chain partner that specializes in lean principles to deliver operational improvement. LeanCor’s three integrated divisions – LeanCor Training and Education, LeanCor Consulting, and LeanCor Logistics – help organizations eliminate waste, drive down costs, and build a culture of continuous improvement.Facebook LinkedIn Twitter Google+