What supply chain new year’s resolutions should be on your company’s list for 2018?
There’s nothing quite like the start of a New Year to get moving on those goals, tasks, and mission that your company has been pondering but not acting upon. As supply chains and logistics operations become more complex and intertwined with other entities, they should become a focal point for firms that want to improve, streamline, or enhance their operations during the coming year.
Here are five supply chain resolutions that all firms should be thinking about as 2018 approaches:
1. Improve sales forecast accuracy. Improved forecast accuracy, when combined with software that translates the forecast into demand driven events, helps companies decrease inventory and operating cost, increase service and sales, improve cash flow and gross margins, and increase pre-tax profitability.
2. Reduce inventory levels. If #1 is on your list, then a reduction in inventory levels should come naturally. To reap even bigger rewards, take additional steps like reducing demand variability, re-examining service levels, addressing any transportation capacity issues, reducing order sizes, and/or reducing supplier lead times.
3. Work on your shipper/carrier relationships. Work with your carriers to determine which lanes and freight work best, and collaborate with them to ensure you are adding profitable business to their network. This will solidify a long-term relationship that will save you from costly changeovers. Also, honor your commitments to your carriers, supply them with accurate data and information, and introduce them to new opportunities.
4. Have respect for the people behind the wheel. Making your facility more driver-friendly helps your carriers retain drivers, which reduces their operating costs to save money. In Pay is important to drivers, but it is not the topic they talked about most in feedback with their employers, Brian Straight highlights a recent WorkHound study that uncovered a mix of positive and negative feedback from drivers. Logistics was the third most popular topic discussed, with a focus on fuel stops, planning, and load assignments among others. Among the negatives of logistics, WorkHound cited wait times, routing, and fuel decisions which are not in the driver’s control. “While trucking is thought of as independent and entrepreneurial, many drivers don’t believe this,” a WorkHound spokesperson noted. “They want to keep moving and they don’t feel they have the power to do that.”
5. Plan ahead and be proactive. If “flying by the seat of our pants” was your company’s supply chain motto for 2017, there’s no time like the present to reverse the tide and take a more proactive approach for the coming year. In fact, the cornerstone of efficient logistics management lies in the planning process and leads to minimal chance of failure or a breakdown in the supply chain. By planning well in 2018 and addressing any potential issues and possible contingencies, you can effectively eliminate the possibility of any supply chain delays while also running a more efficient, streamlined supply chain.