Octagona Srl/Internationalization News/The importance of Supply Chain Management in today's market
The importance of Supply Chain Management in today's market

The importance of Supply Chain Management in today's market

We talk more and more often about Supply Chain Management, in relation to companies that wish to achieve maximum productivity, through efficient coordination between all phases of the distribution chain.

This coordination must be supported by appropriate strategies, which involve every activity linked to resources and personnel impacted from the distribution flow of production. 

There Supply Chain Management therefore concerns everyone activity business aimed at bringing the final product to the market and delivering it to the customer.  

Today it is increasingly covering a'crucial importance for businesses, since its correct application allows you to optimize costs and achieve a better level of productivity, essential if you want to be competitive in your business sector.

Supply Chain Management, the importance of planning 

 

Planning a'Efficient Supply Chain Management is essential to ensure that a distribution network is created that is capable of harmonizing processes and reducing the time between the actual creation of the product and its delivery to the end user. 

There is no un single typology of Supply Chain Management, since this must be designed according to the needs of the individual company, based on its size and consequently, based on the complexity of its distribution cycle. 

The distribution chain can be relatively short, and can also be carried out with direct connections between the supplier and the company, and between the company and the end customer. At the same time it can prove to be decidedly more complex, involving more resources and subjects.

Its planning must therefore be carried out considering all these aspects, which are strictly specific to each business reality.

In any case, the objective always remains the same: to optimize the organizational structure with the aim of obtaining a progressive and constant improvement in productivity, linked to ever greater customer satisfaction.

In today's market, now globalized and highly digitalised, it is of paramount importance to be able to count on streamlined and efficient production and distribution flows, to establish one's brand and fight very fierce competition, in practically every sector.  

To optimize its presence on the national and international market, it is also essential that Supply Chain Management is ready to change based on new trends and/or innovations, always with the aim of achieving, and possibly even exceeding, its business objectives . 

 

Supply Chain Management, the main steps

 

There are five fundamental steps for good supply chain management:

  1. Planning: as already reiterated previously, planning is essential to anticipate what customers' future needs will be and to be able to act accordingly. It consists of verifying the resources (raw materials, components, equipment and capacity) necessary for each phase of production. This activity is often supported by enterprise resource planning (ERP) software.
  2. Sourcing: this phase consists in identifying suppliers capable of guaranteeing quality raw materials and components at prices in line with market expectations and capable of guaranteeing and respecting delivery times.
  3. Manufacturing: it is the heart of the supply chain management process, the phase in which the raw materials are transformed into the final product. During the manufacturing process, companies must pay attention to waste or other factors that can cause deviations from original plans and make immediate corrections if necessary.
  4. Delivering: once the product has been created, the distribution network must guarantee the timely delivery of the products and ensure that even in the case of transport methods that are temporarily unusable, it is still able to guarantee delivery.
  5. Returning: also known as reverse logistics, the last phase concerns product assistance and customer returns. This is a fundamental moment as poor management of the return can damage the company's reputation and call into question all previous work.

Supply Chain Management

 

Supply Chain Manager, an increasingly essential figure

 

In any case, a good Supply Chain Management model requires that all the subjects involved in one or more steps of the distribution chain together constitute a valid collaborative network. 

To achieve this, figures within companies are increasingly emerging, specializing in the management of

Supply Chains

, which have the precise task of optimizing all processes linked to the distribution chain, including the possible outsourcing of certain activities, especially logistics ones. 

The Supply Chain Manager must make sure of this, also providing a'adequate training with the aim of best expressing all the potential relating to the company's resources and identifying new winning strategic models.  

His skills include:

  • the analysis of the relationships between costs and benefits of each distribution channel
  • the planning of all goods flows, from'acquisition of raw materials upon delivery of the finished product to the customer
  • warehouse management
  • the definition of objectives for improving the distribution chain
  • the creation of strategies to optimize distribution plans
  • constant monitoring of performance trends
  • the identification of training processes for staff
  • the integration of corporate marketing activity with the distribution chain

 

We have seen how successful Supply Chain Management is increasingly essential today for companies that want to improve their presence on the markets and expand their business.

We of Octagona we have been alongside companies eager to grow for years, and we are ready to offer you our advice and all our support in this regard.

For any questions, please feel free to contact us.  

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