Supply Chain Integration allows for tactical and operational control
Supply Chain organisations are well established in most companies. However, with the introduction of many computer based business support systems and the commercial pressures to reduce costs, the supply chain focus has shifted to operational efficiency and cost reduction and businesses must look towards supply chain integration.
These lean supply chains deliver immediate bottom line benefit but can result in a loss of flexibility and resilience to change. Either a short-term crisis or longer-term shift can substantially disable the supply chain. Often the cause of the change is external and is a result of a lack of awareness of the changing business environment. Otherwise it can be internal, with a change in business strategy not being fully translated into the supply chain processes and organisation.
Global supply chains are even more dynamic and subject to many perturbations. Supply chain professionals are therefore drawn into a continuous process of managing unplanned events and improving operational processes to avoid new ones. They are aware of the increased complexity of global supply chains, reflecting the differing regional standards, legislation, assets, and capabilities. However, it is an increasing challenge for them to close the gap between the day to day operations, business strategy, and the changing business environment.
Ensuring that your present supply chain is fit to support present business needs and your future strategy requires both a structural and dynamic alignment. This supply chain integration and alignment should not just include all the physical assets involved and the operational planning required to direct the assets and optimise the flow of materials. It should also ensure that the reporting and management control processes allow informed and timely decision making at the right level. Modern digital systems create a wealth of data but this must be translated into meaningful information. These systems should also ensure that decisions are rapidly and effectively communicated to all the relevant functions, including external service providers.