In many small businesses that go through rapid expansion and growth, the supply chain seems to grow almost organically along with the company. Often this occurs when decisions on suppliers, vendors, freight companies and other partners in the supply chain happen quickly, and they are never evaluated as the supply chain grows.
The answer to this issue, or when developing a supply chain, is to take the time to go through the process of supply chain planning. With complex logistics issues, software solutions make a very complicated and detailed supply chain easier to understand, plus it also provides the ability to try different options through a simulation program to see if they improve issues or create new problems.
Better Decision-Making Processes
When starting out in supply chain planning, the key is to have the big picture, not to work with incomplete data. This is where a customized software program can be very important as it will prompt for data and to allow the planners to then focus in on specifics that may have been overlooked in past planning and considerations.
In addition to looking at what is there, the planning process can also look at potential unforeseen or unexpected issues. This can include having redundancies in the system to address issues if a key supplier fails or other types of possible issues that can occur.
Through planning, it is also possible to detect inefficiencies in the current system. This may include excessive handling of a product that may be happening in-house or issues with product tracking that is simply not effective. Once these issues are detected through supply chain planning, corrective measures can be put in place.
Also, the use of supply chain software for planning may show areas where automation can be built into the system. Not only will this boost efficiency, but over the long term, it will help in reducing logistics costs.