The importance of good supply chain management has increased dramatically over the last decade, as organizations realize the benefits of supply chain for driving competitive edge. The biggest brands - particularly Amazon and Apple - have demonstrated to others how designing their supply chain in line with their strategic goals can boost the bottom line, and everyone is following their lead.
In order to facilitate this, supply chain leaders have had to develop new skill sets and refine old ones, as their responsibilities shift towards that of a fully fledged business partner.
A problem solver
Supply chain executives still need to be experts at managing traditional supply chain functions such as transportation and inventory management, but in order to drive the benefits of supply chain to the overall organization, they must no longer concentrate on the minutia of the supply chain. These roles must be delegated to both employees and new technologies, while executives focus on high-level problem-solving skills and creative thinking alongside the C-suite.
To do this, they must have an overview of every facet of the company that is impacted by and impacts on the supply chain so they can best identify opportunities to cut costs and improve efficiency. They must also have an overview of the entire the supply chain in order to see where they may need to work closer with partners, where they may perhaps need to change partners and initiate relationships with firms nearer their base as a result of transport costs or cheaper labor.
Maintaining good relationships with suppliers has always been vital to good supply chain management, but it has become even more complex as the world has become more globalized. Supply chain leaders need to ensure that they are in constant communication so they can help partners better execute their processes, and so that they can be aware of any delays that could have a knock-on impact down the chain, and any risks that could potentially cause delays.
In order to achieve mutually beneficial connections with supply chain partners, it is necessary to have an in-depth understanding of the business operations and a natural gift for relationship building. They must nurture long-term relationships with suppliers, and delegate strategic and operational capabilities to individual agents to help ensure an ongoing mutually beneficial relationship - and recognize when it is no longer mutually beneficial.
It is also vital to communicate supply chain goals across your own organization to ensure collaboration, and that the goals are aligned with the business’s entire strategy. It is all very well having a great supply chain strategy, but without full team support it is unlikely that it will be successfully executed and the whole farrago is effectively rendered meaningless.
A key business sponsor for IT
A recent Deloitte report, ‘Supply Chain Talent of the Future’, found that 95% of the supply chain leaders said advanced analytics including optimization and predictive analytics was the foremost capability of the future and that their companies either currently use them or expect to in the future. However, just 46% said they saw it as a strength today in their supply chain organizations.
The supply chain manager does not need to be an expert in IT, but they do need to work closely alongside the CIO to make sure they are using all the technology they can to drive improvements throughout the chain, and employ staff with at least an element of IT-savvy. They need to always be on top of the next-generation of technology tools, as well as implementation challenges that are part and parcel of today’s supply chain software solutions.
A Risk Manager
The latest A.T. Kearney report, ‘Is Your Luck Running Out? Managing Supply Chain Risk in Uncertain Times’, found that there was a strong understanding in supply chains of the level of latent risk, yet there was a real failure to translate this recognition into a solid plan to actually deal with them should they arise. This would suggest that supply chain leaders are forgetting some of their traditional responsibilities. This is particularly true in a global supply chain, in which there are constant risks. They now have a wealth of information coming into them, and this must be analyzed within seconds and decisions made to address issues before they arise. They must also have contingency plans in place for every possible scenario allowing them to react quickly should disaster strike.