There are many modern industries built on strong supply chains. If these chains should break, it can have a ripple effect that harms businesses and the economy more widely.
There are nine important things you need to know for any business that has an important supply chain to oversee.
Table of Contents
- 1 Regularly Review And Update Your Strategy
Vet Your Suppliers Carefully
Whenever you are considering partnering with another business, proper vetting is essential. Not only do you need to be sure that your partners can provide you with what you need, but you also need to trust them to deliver a professional service. Whether your suppliers are individual freelancers or other businesses, your business’ fortunes will often be in their hands.
You can learn a lot about a potential supplier just from talking to them, and this is where you should begin the vetting process. Ask them any questions you need to verify that they are offering what you need. You can then take the opportunity to dig a little bit deeper and find out more about the business and the people behind it. In some industries, going even slightly beyond the surface can reveal a substantial amount of useful information.
Don’t Pin All Your Hopes On A Single Supplier
It is always good to have a backup plan. You never know when Plan A is going to come down with something incurable and force you to implement Plan B, whether you want to or not. You should implement redundancies wherever you can to ensure that one supplier going out of action won’t cause severe disruption to the rest of your business.
It doesn’t matter how stable and reliable your main suppliers might be. They are still ultimately comprised of people, and people are prone to all sorts of unpredictability. Depending on the industry you work in, your suppliers may also be vulnerable to specific climate, seasonal, or even geopolitical factors that aren’t a concern for most industries.
Expect the unexpected. Prepare for the worst and hope for the best. If you always have a backup ready to kick in should your main approach fail, your business as a whole will be much more resilient.
Maintain Regular Communications
When you are working with other businesses, good communications are key. Miscommunications can lead to problems for both parties. Those problems can wind up costing one or both of you a lot of money in the worst cases. Even in the best scenario, a miscommunication means wasting time.
Before you commit to a supplier, test the waters by initiating a dialogue with them. You should be vetting them to ensure their suitability anyway. But on top of this, you should be paying attention to the way that they communicate with you. Make a note of how long it takes them to respond and their attitude to answering your queries.
Of course, you also need to do your bit in communicating with them with the same tone and proficiency that you expect in return. If there is a mismatch in your approaches and personalities, communications can be stilted. But as long as you are confident that they are competent and will hold up their end of the bargain, you shouldn’t be afraid of pairing with them over a slight clash of personalities.
Get Your Managers Certified
In today’s globalized economy, the delivery of goods and services has never been more critical. Manufacturers, retailers, and consumers are all dependent on a 24/7 global supply chain that keeps everything moving. Even during a pandemic!
Accordingly, the role of supply chain manager has never been more essential. This role is worth investing in; your business will benefit from a qualified manager. You can click here for more information about the supply chain management course from Kettering University and its benefits.
The more essential your supply chain is to your business’ health, the more valuable it is to have a full certified manager heading the whole thing up. A supply chain manager will take responsibility for ensuring that your supply chain remains unbroken. They will have the specialist knowledge and deep understanding of the underlying principles needed to enhance every aspect of your business’s supply chain.
Pairing an in-depth theoretical knowledge with practical experience is a potent mix. These are precisely the kind of people that you want to manage your supply chain. Experienced supply chain managers know what levers to pull and who to talk to to make things happen. They also know exactly how to react in crisis times to protect your business and keep things moving.
Forge Long-Lasting Relationships
Long-term relationships are always nice. In the business world, the right long-term relationship can bring enormous benefits to all parties involved. Not only can you both profit handsomely from the right relationship, but you will simultaneously be expanding the reach of your business and growing your network of business contacts.
The longer you can sustain a relationship, the more beneficial it will be. Many businesses are willing to offer more favorable terms to the other companies they have had the longest relationships with. You should consider taking a similar approach and rewarding your most loyal collaborators.
Accept Honest Mistakes
Nobody’s perfect. We all make mistakes now and then. Of course, some mistakes are bigger than others. And some mistakes are easily avoidable. But it is inevitable that, given enough time, we will all make a mistake in our professional lives. As people, we are often quick to judge others without necessarily reflecting on our own behaviors. A little forgiveness can go a long way, though.
Unless someone makes an unforgivable mistake and shows no hope of being redeemed, you should be willing to overlook minor transgressions and focus on the bigger picture. Unless the mistake is so grave that it trumps the relationship, you have both spent time, effort, and money cultivating, your business brain should lead the way.
Don’t Be Afraid Of Negotiation
Negotiating is a standard part of doing business. Any CEO worth their salt needs to negotiate with other businesses, people, and sometimes even governments. A CEO at the helm who is unable to negotiate effectively is going to drag a business back. Equally, if there is no one advocating effectively for your business during negotiations, you are inevitably going to lose out on countless opportunities.
Instead of avoiding negotiation, be ready to dive in headfirst. It is possible to negotiate effectively, playing your business’s relative strength to other businesses while remaining friendly and improving the relationship between you both. While being strong in negotiations is doubtless a good thing, it is not the only skill worth looking for in a negotiator. You also want people who can think creatively and are adept at solving puzzles. These are the people who will come up with the creative solutions needed to keep multiple parties happy at once.
Regularly Review And Update Your Strategy
Every business should conduct regular audits of its current procedures and performance. This information is invaluable in devising future strategies and refining your existing approach. If you don’t ever take the time to step back and properly evaluate what you are doing and whether it is working, your business’s efficiency will suffer.
Having knowledgeable and certified supply chain managers overseeing your operations will help considerably when it comes to reviewing your approach. They can offer a level of insight that no one else can. Not only can they provide your audits with all the relevant data, they need to draw their conclusions, but they can also explain to you exactly why you need to make specific changes to your approach.
Invest In The Right Supporting Technology
There is now a seemingly infinite number of technologies that businesses can use to support their supply chains. Technology can make people’s jobs easier who work on the frontlines of your supply chains. For example, automation technology has transformed supply chains at every level. Warehouse management systems now take on the important task of coordinating workers in warehouses, carefully choreographing their work to maintain maximum efficiency.
Of course, there are also the robots that produce components, and in many cases, assemble them as well. Parts move through production lines at unprecedented speed thanks to increasingly advanced technology that is capable of producing perfect copies of the same piece over and over again.
If you are willing to invest some of your money in the factories and other businesses that support your supply chain, you can reap some serious financial rewards. It is important to invest in people, of course. But the right technology doesn’t just make them more efficient workers for your benefit. It often makes their jobs easier and safer as well.
A well-managed supply chain is essential for many businesses today. Even with the Covid-19 pandemic restricting the flow of goods, global supply chains have largely proven themselves resilient. If you properly manage and maintain your supply chain, it will see you through any crisis. But if you neglect it, you risk being crippled by a single grain of sand getting into the works. Stick to the supply chain management tips above, and you should have no problem keeping the flow.