Nov
2
Why Innovation And Technology In The Supply Chain Can Help Boost Competitiveness
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Sometimes people treat the supply chain in a manner that is not wholly appropriate. They think of the R&D team as being the innovators, the tech guys as being those who implement all the technical items and the supply chain? Well that is the bottom of the pile, they only supply the widgets and the components that we turn into something special. So why should there be any need for either innovation or technology in the supply chain?
Well this kind of ignorance could cost a company dear. If the supply chain can be both innovative and apply technology appropriately, then there is a whole wealth of savings that could be made! In turn this keeps a company with an innovative and technologically advanced supply chain in a position where it is Lean, mean and competitive
Here are some examples of typical supply chain innovation and technology use:
Innovation and Technology Combined
If innovation can be combined with technology then effectively the limit for bringing in new developments is in a sense limitless! For example, the use of Radio Frequency ID tags, often referred to as RFID is both using technology and it is indeed an innovation because it helps the supply chain become more cost effective. The levels of stock can be almost instantly monitored by using a pretty straightforward merchandise monitoring and management system, so gone are the days when you had to worry about counting each individual item.
Now you have the tags attached to pallets and this feeds the information to the system and the results are almost instantaneous and this results in the stock levels being kept to a minimum whilst ensuring that stock outs do not occur. These RFID tags do really rock and will change the way that warehouses work and keep costs down; so that is why innovation and technology need to be implemented within the supply chain. Only through keeping costs down can you increase competitiveness and so the supply chain has to have innovation and use technology. After all, if one company doesn’t do that, then here are others who most certainly will!
Innovation To Beat Obsolescence
Obsolescence is a real threat to businesses. You spend years developing a product, you bring it to market, then within a couple of years component parts become increasingly obsolete, costs rise and your competitiveness suffers. So what do you do?
Well, if there is a good deal of innovation within the supply chain, then the instance of obsolescence can be reduced. Items can be updated, reviewed and changed within a supply chain that is innovative, flexible and stable. If on the other hand, the supply chain is intransigent and can only provide x number of widgets, created to the specification that they have had for the last 10 years and no changes can be accommodated, then obsolescence can be a real threat. Companies simply cannot remain competitive if they have high levels of obsolescence, so it is vital that this is kept to a minimum.
Global Sourcing
Increasingly the supply chains that are in operation are becoming global and there is little doubt that only supply chains that are innovative and use the latest technology will be able to survive into the future. Those who simply react retrospectively will be unable to cope with the demands of a global supply chain: but those which manage to embrace both innovation and the use of technology will be able to survive. This will be the logical extension of competitiveness, so innovation and technology are inherent requirements of the supply chain, not luxurious options to be addressed as and when; they are needed now!
Sustainability
With Corporate responsibility garnering such interest the impact of the procurement team on the environmental footprint of the business is significant. Through innovation and changes in policies and processes change can come. With appropriate strategies and goals – procurement teams can take a close look at requirements and incorporate sustainability criteria on supplier and product selection helping to save both the environment and cost.
Purchase to payment
Perhaps the most significant innovation through the utilization of technology can come from streamlining the Purchase to Payment (P2P) process. Technology driven Purchase to payment can challenge and mitigate typical operational issues (compliance, authorization, visibility) through process simplification and bringing together the procurement team, requisition, suppliers and finance teams within the value chain.
Nov
2
Why Management Consulting Still Has A Role To Play For Improving Your Supply Chain
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Management consultants received a poor press during the late 1990’s and early part of the 21st Century. Originally they had been viewed as some kind of God, then some kind of pariah, who were often out of touch with some of the more recent thinking and innovative management techniques. The often stated criticism was that they would charge a lot of money to tell you what you already knew.
However, management consultants soon ‘wised up’ to the challenge of being a management consultant in the 21st Century and started to specialise, many having particular skills or training in some specialised fields of management.
For example, it is now possible to secure a management consultant who is a logistics expert. They can help you to look at the way that you organise logistics and suggest areas for improvement. This can reduce the costs associated with logistics, streamline the processes used and ensure that performance is maximised; all in one go!
Management consultants can also establish performance metrics for the organisation and then go on to look at the Key Performance Indicators that can really help to establish exactly how your organisation is performing.
Some management consultants specialise in procurement, so they are able to advise on the best way that procurement can happen and often have experienced change and resistance to change in organisations, so they are able to work with all departments to help implement some of the changes that may be required, following changes to the way that procurement is made.
Specialists In Software and Technology
Many management consultants now straddle a fine line between being IT literate, to a very high degree and being management consultants. However a good management consultant will now be able to look at the problems that an organisation has, or at its performance and make recommendations on how technology can be applied to standardize and simplify.
This can be invaluable, because it is almost like having an IT specialist and a traditional management consultant all wrapped up into one person. However, it also helps the organisation on different levels, because it isn’t just about management and it isn’t just about IT; it is about both together and that is of critical importance.
A Fresh Pair Of Eyes
One great thing about a management consultant is that they offer a fresh pair of eyes, looking at your organisation in a way that you probably would like to, but find it difficult. The management consultant is independent (in a sense) and objective, so he or she will not be swayed by personal history or by internal politics. They don’t know the history and they won’t be involved in the politics, so they can simply come in and see what is going on and then report back with suggestions for improvement. The fact that they have typically experienced a variety of businesses also helps achieve senior buy-in for change as they represent a much more credible voice to senior stakeholders.
Assistance and Collaboration
The management consultant is ideally placed to facilitate between organisations who wish to work collaboratively. Often it can be difficult for companies to approach each other, but the management consultant is independent enough to make this relatively easy. So they can set out the process for collaboration in a way that is not threatening to either of the parties.
Managing Change
The final real benefit of management consultants is that they can help organisations to cope with change. Often the best plans in the world are thrown out because the staff are so resistant to change that the new plans are simply rendered unfeasible. However, a good management consultant will help to alleviate this resistance and ensure that the service improvements that are required, can be implemented in a way that is smooth and hassle free!