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10 Ways to Improve Supply Chain Efficiency in 2021

Efficiency and effectiveness are imperative for any healthy, functioning supply chain. An efficient supply chain makes the most optimal use of available resources while also reducing waste. An effective supply chain is one that delivers every time, on time, and with quality assurance.

For example, you might have a fast-moving, highly efficient supply chain that quickly gets products to customers. However, the products may be of poor quality, which is not effective. Conversely, maybe you have a high-quality product that always arrives on site, but it almost always arrives late, and the customer is disappointed, which eventually ends the relationship.

The goal is to achieve both efficiency and efficacy—and it’s entirely possible.

Here are some ways you can create and maintain an efficient and effective supply chain:

  1. Bottom-up innovation: Empower your team to create a more efficient, valuable supply chain. Get your employees, suppliers, clients, and consumers involved in the action. Do this by listening to everyone involved and considering their feedback. This is a bottom-up innovation approach, as opposed to the top-down approach, in which leadership sets the tone without considering input from those at other levels.

  2. Set expectations: Everyone involved with your supply chain should know their roles and expectations. Expectations include KPIs, codes of conduct, and aligning vision and values. Ensure everyone has access to the appropriate training, including interpersonal skills, communication, and relationship management (since collaboration is imperative in creating an efficient supply chain).

  3. Data sharing and visibility: Whether you’re highly sophisticated with an IoT solution that travels with your freight or you’re a smaller e-commerce shipper trying to keep track of USPS’s missteps, you need to provide real-time, high-visibility solutions to the team. Keeping everyone aware of the data and sharing it with the team will create a more efficient information flow and provide a full view of the supply chain.

  4. Use real-time analysis: In today’s environment, a month-old report is not enough to solicit insight and projections for the future. Decisions are made using live, real-time data. These decisions are supported when the process is transparent and visible to all involved. Therefore, using real-time analysis and involving the team will provide insights on data outliers and inefficiencies in the system. These real-time insights will then accelerate innovation.

  5. Nurture partnerships: A supply won’t run successfully, efficiently, or effectively if it operates in a vacuum. Third parties that execute the day-to-day strategy should be involved in more than the execution. Take time to make those third-party relationships a part of the strategic decision-making process. Existing supplies also often play a crucial role in bringing opportunities and innovation to improve current processes that benefit the customer. Ask yourself how you tap in and capture more leverage, resources, talent, and technology from your valued partnerships.

  6. Engage your organization: Every individual plays a role in the supply chain. A leader must know the positions, understand the roles, and help individuals get the most from their existing resources to innovate and collaborate at every step. If you want to learn more on this point, download our eBook, How to Get the Most Out of Your Outsourced Logistics Partnership.

  7. Adjust the strategy: While your strategy might be set, remember that it’s an ongoing process. To ensure you continuously have a healthy, functioning supply chain, you need an assessment plan to ensure you’re always working toward your defined objectives. Quarterly business reviews provide a framework to guide you and your providers through the objectives, expectations, and moving targets to ensure they will help you achieve your predefined goals. Use the assessment to lead the team toward making more intelligent decisions and investments into the supply chain.

  8. Supply chain team: There will always be roles within an organization that are visibly tied to the supply chain’s efficiency (especially related to revenue-producing KPIs) and others that are not. To navigate the roles, create a council or board of leaders that oversees the supply chain strategy, efficiency, and functionality. This team will serve as a liaison to help the organization recognize how the supply chain strategy aligns with the team’s roles and duties. This approach can improve cross-functional communication and decrease lag time when introducing and implementing new initiatives.

  9. Identify opportunities to improve technology: Take a look at your processes and identify where technology can enhance and streamline the process. Assess where the company can improve standards through technology that will support the initiative. This could be through a cloud-based move or EDI shipments. Do your research and then select a technology software provider that fits your needs.

  10. Encourage constant collaboration: Communication must be ongoing. Suppliers, clients, employees, and vendors must all be cohesive. The best collaboration comes from long-term and strategic partnerships when success is mutually beneficial. Transparency means crucial lines of communication stay open, and that’s where the magic happens.

By working through these tips and tricks, you can establish better communication, disseminate information, and support collaboration. Ultimately, this will help you create and sustain a more streamlined, efficient, and effective supply chain.


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