By Tompkins Solutions
Supply chains have transformed over the last decade amid changing customer expectations, the rise of e-commerce, and logistics and trade pressures. With those changes comes a new mandate for the chief supply chain officer (CSCO).
The CSCO’s role used to be a lot simpler – get products from point A to point B with the least amount of difficulty or cost. Today, CSCOs have much more to do, overseeing the entire global supply chain while continually evaluating the latest technologies and solutions. Here are four common traits of a high-functioning modern supply chain.
Instrumental in controlling costs and managing complex operations, network optimization is paramount to supply chain success. Not only does the optimized network yield higher profit margins, but it provides a better overall customer experience as well.
Capacity analysis, network modeling and network design are all fundamental steps CSCOs must take when developing an optimization strategy. Networks designed based on deep comprehension and alignment with the organization’s goals and objectives enable optimal performance during unstable market conditions.
Securing the right amount of warehouse space is a balancing act – you want enough to meet needs during seasonal upswings, without overpaying for space. Developing a warehouse strategy starts with identifying the gaps between existing space and requirements.
Once capacity gaps have been identified, CSCOs must consider every available option for optimizing warehouse space. Options include, but are not limited to, relocation, facility expansion or redesign, or enlisting 3PL providers. Implementing the right warehouse strategy will make your organization more agile amid changing needs.
Supply Chain Technology
To maintain the type of oversight CSCOs need to have over operations, visibility at all supply chain stages is critical. Choosing the right technology for your operations is key to unlocking true visibility.
Selecting the right technology starts with a comprehensive review of IT system capabilities and process requirements. This will provide an understanding of which tools are compatible with existing systems and provide features that will improve data and product flows while minimizing or eliminating constraints. While it would be easy to select tools based on price alone, what’s more important is understanding the return on investment. Depending on your needs, a best-in-class platform could provide capabilities that justify a larger investment. Similarly, choosing a best-in-class platform with a majority of features that will go unused is a poor use of budget.
Optimized Labor Strategy
With labor shortages plaguing the industry, CSCOs are being challenged to keep operations moving, despite demand exceeding supply. An optimized labor strategy increases productivity, reduces costs and enables companies to be more flexible in the face of labor shortages.
Potential strategies range from reducing the need for human capital with automated systems to relocating operations to less competitive labor markets. With labor representing one of the largest expenses in supply chains, implementing a strategy that allows your business to succeed in the midst of labor shortages is key to future-proofing your supply chain. Check out our other resources to learn more about how to optimize your supply chain operations.