A business always has a mindset to grow and goes through several hurdles in order to do so. If you are a business leader, who would want to scale your business, you should have an impeccable supply chain.
The term ‘business success’ has a lot of details and requires research and understanding. Earlier reports from Deloitte stated that about 79% of the companies with an efficient and strategic supply chain management system had much more growth. Under their industries, these companies performed well.
Also, about 8% of the companies that had a mediocre supply chain had a slight above average growth. You can consider the supply chain as one of your most invaluable assets for your business.
In any business venture, studies have indicated that their growth or failure in the first 5 years could depend on the performance of supply chain management. There can also be several financial challenges for any business to fail or even worse go bankrupt.
A large number of corporations along with medium-sized enterprises have global supply chains. Studies show that the cost base shows 90% devoted to supply chains. In any business, there has to be a well-researched business model. Supply chain management being efficient is an added expense above all others for any business to thrive in its specific industry.
We can understand that supply chain management has just evolved with time. An earlier report from the Australian and Securities Investments Commission revealed that 44% of the business could not grow or failed for lack of effective supply chain management.
Business success depends heavily on supply chain management which often gets overlooked from critical leadership solutions. The supply chain is also under study as it is yet to understand all the essential metrics.
Strategies behind supply chain-
There was a study a few years ago which revealed shocking revelations about businesses not considering supply chain management as a standalone system. Which means that industry leaders could not decipher the intricate alignment of the supply chain with other business strategies.
A properly catered supply chain is imperative for achieving corporate success and ultimately fulfilling commercial goals. Your supply chain management should support the entire business structure, which is not the case for several businesses in the modern economy. It is very important to review the supply chain in order to ensure business success.
Looking into the growth of Walmart, we can understand business success for efficient supply chain management. The company deeply studied inventory that is managed by vendors. They strategically partnered with vendors to provide affordable prices to the customers. Walmart also applied cross-docking for reductions in inventory and made their supply network productive. Also with the help of technology, Walmart became a leading low-cost retail business with a massive pool of loyal customers.
Designing of Supply Chain Management-
The supply chain design plays a pivotal part for business success which includes outbound distribution from warehouses. Along with this, the supply chain evolves with time after making changes and improvisation along the way.
For your business success through supply chain management, you should be cognizant of an effective supply chain design. There is also scope for service improvements which can garner more savings and opportunities for business growth.
Studies about Whirlpool’s success indicate that supply chain formed an integral part of business scalability. The management team understood the continuous optimization of the supply chain management for avoiding economic abnormalities.
The company emerged with a redesigned methodology. This included a process that comes with consistent vigilance on network design. The system also got added with a cohesive structure of collection, standardization along with cleansing of supply chain information.
Whirlpool also empowered itself with better understanding of the supply chain system which helped them stay industry leaders for about 13 years. Well! Of Course the work always needs optimization and expert study. Since 2017, Whirlpool also looked into warehouses that were nearer to the customers in order to stay competitive in the digital economy.
- In today’s time, the company also provides a shared warehouse policy in order to expand the distribution network. The modern economy demands a business to stay aligned with the current market trends.
- And more importantly, it requires a business to create products that offer substantial value to the customers. In any business, a growth that is marked by profitable revenue is one of the most critical factors along with customer satisfaction.
- The supply chain of a business can be related with customer satisfaction and a business should always look after these domains. When strategizing an effective design of the supply chain, one of the most important conclusions to keep in mind is customer satisfaction.
Some of the key aspects of a poor supply chain include delays in delivery time to the customer. This is followed by inefficiency in response to customer feedback, shortages in inventory and below standard quality products. On recognizing any of these hurdles, you should always take it as a top priority and address these pain points. The operational performance should improve on rectifying these problems and ensure business success with a stellar supply chain management.
Lessons from supply chain success stories-
The popular shoe company, Zappos have championed stellar customer service excellence. Being an Amazon subsidiary in recent years along with its inception as a brand, Zappos have provided top-notch quality to its products. Zappos with its customer support is a beautiful example for companies to learn and understand the importance of supply chain.
When you are trying to figure out the supply chain cost for your business, there are a few key areas to study. In a business, costs devoted towards the supply chain are usually massive. But as a business, you should try to understand which products are adding more value to customers. In this way, you can exclude products that have overbearing manufacturing and shipping costs.
Some of the key verticals to determine excessive supply chain costs include the expensive cost of transportation, cost of maintaining storage and inventory, inefficiency in inventory management, cost of procurements and several others. It is very important for you to streamline the process of supply chain.
The performance of your supply chain management depends on your supplier. This can make or break your business. It is very important to collaborate with your primary suppliers and work towards reducing any uncertainties in the supply chain system of your business. If there are challenges in the supply chain, it would increase expenses in a business and disrupt positive customer experience.
Suppliers who are unethical can tarnish the reputation of your company. Especially, if you are an emerging small business trying to make a name for your brand, unethical suppliers can hamper positive customer experience. Even if your business does not need inventory and is heavily focused on service, there can be a point to transport at least some sort of spare parts or maybe consumable items. At the end it is your business and you should always look after the growth wheel of the company. Innovations in technology, automation, and artificial intelligence can help a part of your venture. But the phase of idea generation, business model, and execution is your forte. The digital economy in India is booming and startups are getting evolved into unicorns. There are loads of opportunities in the market for your business to thrive. You just need to trust the process and the team building your objective.
Frequently Asked Questions-
- What are the advantages of supply chain management?
Ans– A well-functioning supply chain management helps in business success and enhances customer experience.
- How to make a successful supply chain management?
Ans– A successful supply chain management comes with collaborating with the right supplier.
- What is the most crucial factor in supply chain management?
Ans– A supply chain management system should be well-planned and flexible for new improvisation.
- Mention 4 elements of a successful supply chain system.
Ans– Integration and operation combined with purchasing along with distribution are the 4 elements of a well-planned supply chain.