Spending and activity are on the upswing as companies are increasingly using their supply chain to gain market share. This has lead to a paradigm shift in how companies view their supply chain. Ideally Supply chain management aims at essentially reducing inventory, increasing the speed of transactions with real-time exchange and increasing by efficiently fulfilling customer demands. It does not only involve the movement of a physical product through the chain, but also includes any data that goes along with the product like an order status information, payment schedules, and the actual entities that handle the product from stage to stage of the supply chain.
Most organizations are just beginning to recognize the benefits and problems that go together with an integrated supply chain, making the practice of supply chain management a fairly recent phenomenon. Some of the trends that are changing the supply chain management are as follows:
The key to input to the larger Sales and Operations Planning process, demand planning has a significantly positive impact on new product introductions, inventory planning and management, customer service, supply planning efficiency and sourcing strategies. The demand-driven approach facilitates companies to create a more customer-focused mindset, without sacrificing operational efficiency. It consequently improves the management efforts greatly, and helps the overall costs and customer service efforts. Advanced demand planning systems and appropriate tactics can also help discover data and identify trends that may be buried in a company's information systems. Companies need to be committed to demand planning and forecasting efforts to yield the best results.
Increase in competition
An increase in competition invariably leads to price pressure. Companies need to look at the supply chain management to offset this trend. It therefore becomes necessary to reduce cost and create a more efficient value chain to remain cost competitive and provide value-added services to meet the demands of customers. By streamlining processes with better design, better collaboration across networks and new services can help the company stay competitive and strengthen relationships with customers.
Short Product life cycle
To meet the needs of both customers and consumers, companies need an efficient product lifecycle management process, which includes grave emphasis on managing new product introduction, product discontinuation, and leveraging across their entire product and infrastructure characteristics. The end result isn’t predictable without a formalized product lifecycle process. Product lifecycle management Technology and processes can ensure that products being produced for specific markets are well-managed and are compliant.
Outsourcing all or part of your supply chain operation can bring about significant economic benefits. Although without the right systems, processes, or organizational management structure the risk to success can increase to frightening levels. When outsourcing supply chain , the need for information controls and excellence from the “information worker” becomes a high priority. There also is a need for information systems to connect and coordinate the supply chain as seamlessly as possible in such a scenario. If not managed efficiently, it can result to a breakdown in the entire supply chain.
An inefficient and poorly functioning supply chain services can have a negative impact on almost every aspect of an organization, thus jeopardizing the long-term performance and success of a business. To remain successful, companies need best-of-breed Supply Chain Management.