How to Diagnose the Weakest Point in your Supply Chain
Every Supply Chain is as strong as its weakest link. That is why the steps taken to efficiently get products and services from point of origin to customers at a considerable cost and in the best condition are key components of a successful Supply Chain. In other words, the effective management of a company’s Supply Chain is instrumental to its overall success, in relation to lower operating cost, customer satisfaction, and long-term financial health.
In view of the foregoing, the focus should then be on how to strengthen every component of the Supply Chain by identifying and better managing those points that constitute the likely potentials to weaken the entire supply chain. The following are some of the several ways of effectively managing your supply chain to diagnose the weakest point and guarantee a more efficient Supply Chain:
Create Performance benchmarks: Having performance benchmarks for every aspect of your Supply Chain is the most important step for tracking the performance and identifying potential or existing weak points. That way, the performance of employees, vendors, suppliers and all relevant parties in your Supply Chain are measured at planned intervals to spot performance gaps and recommend improvement actions. For instance, if you are a manufacturer, the key components of your Supply Chain that must be tracked or measured, will include your source of raw materials, the supplier, the third-party Logistics vendors, your Warehouse and Inventory Managers, local distribution system and your Information Technology/Communication systems. Once this is effectively done, potential weak points or risks are identified and addressed with improvement actions.
Engage A Competent Third-Party Logistics Provider: When key aspects of your Supply Chain are outsourced to Third-Party providers with core competence in those areas, they will help in diagnosing the weak points or potential risk(s) within your Supply Chain, offer professional advice on how to eliminate or better manage those risks; how to better manage logistics cost and get supplies across to your customers within agreed timelines.
Obtain Customer Feedback: Bearing in mind that the goal of every Supply Chain is customer satisfaction, you must create several channels of obtaining feedback from your customers weekly, monthly or at suitable intervals. Could be through a satisfaction survey, post-delivery follow-up calls, emails or organized face-to-face meetings. Carefully analyse these feedbacks with your team because they usually contain a lot information on performance gaps, areas of satisfaction and areas that require improvement.
Leverage the Most Efficient Technological Tools: Technological software for production planning, end-to-end seamless flow of information, warehousing, inventory forecasting, barcoding, scanning to distribution, have made Supply Chain Management more efficient and easier to track performance and diagnose weak point in your Supply Chain.
Track Adherence to Terms & Conditions of Service: One of the best ways of guarding against the potential weak point of non-adherence to contractual obligations is the ensure, among other measures that the following are observed:
- Constant engagement of third-party vendors and suppliers at planned intervals for clarifications on issues pertaining to service expectations, cost control and delivery schedules in your Supply Chain.
- Joint team-building sessions focused on service requirements to ensure that the expectations communicated are clearly understood and accepted by your team and the selected third-party provider.
- Constantly monitor and control processes and procedures addressing interactions between all third-party agents and your logistics team and track potential gaps capable of becoming weak points in your Supply Chain.
The ability to track potential or underlying weak points in your Supply Chain is a critical success factor in Supply Chain Management. The import of this is to ensure that every link in the Supply Chain is as strong as the others in a bid to achieve one collective goal – Customer Satisfaction.