A company’s supply chain is one of the most important aspects of its operations. It can be a competitive advantage if it operates efficiently and smoothly, but this is not always the case. If you want to make sure your supply chain management strategy is working well, then there are many things to consider- such as suppliers, production processes, distribution channels and inventory control.
A firm can exercise greater control over its suppliers by having:
In-depth knowledge of suppliers’ capabilities and performance,
Strong relationships with key suppliers, and
The opportunity to collaborate on strategic objectives.
Â When a company has these things in place, it can make informed decisions about how best to use its supply chain resources. One way is by opting for short cycle times as opposed to long ones because this will help minimize any potential issues that may arise in the near future (such as increased costs).
Another option would be investing more heavily in inventory management so that excess stock isn’t created unnecessarily when there’s no demand. This means not only having an accurate understanding of customer demands but also being able to predict them well into the future.