Simplifying Complex Global Supply Chains

Read Time: 4-minutes

One of the big obstacles in creating really reliable, ethical, and sustainable chemical supply chains is the overwhelming complexity.

So, in this weeks issue, let’s explore how we might go about simplifying things.

Firstly though, why does it matter?

Well, if we get a good grip on the intricacies of global supply chains, we can reduce costs, increase efficiency, and improve our reliability.

Essentially, ensure we stay competitive.

Let’s break it down into the following areas:

1. Supplier Capture

2. Vetting Process

3. Main Components

4. Common Challenges

5. Key Strategies to Overcome them

"Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But it's worth it in the end because once you get there, you can move mountains." – Steve Jobs

Implement a Supplier Capture Tool

If you’re anything like me, you will be frequently contacted about buying new products, or by new suppliers. Most people ignore these approaches, which I think is the wrong move.

Create a form or a capture tool which populates a database with their information. This will be invaluable for managing contacts and reaching out to source products and ingredients down the line.

You can view mine HERE, but make sure you tailor it to your specific business needs.

Implement a Strict Vetting Procedure

Employing a stringent vetting process early in the supplier relationship can help you to filter out those who don’t meet your standards, effectively allowing them to self-disqualify.

This saves time and resources by focusing on suppliers that are more likely to meet your needs and standards.

Why not try and develop a checklist or scoring system that includes your non-negotiable criteria, like compliance with industry standards, financially stability, adherence to ethical and sustainability benchmarks.

Make this checklist part of the initial engagement process, clearly communicating it to all potential suppliers.

Understanding the Main Components of Your Supply Chain

A well-functioning supply chain includes various components, each playing a crucial role:

• Manufacturers produce raw materials.

• Suppliers provide the raw materials.

• Logistics Service Providers move products from one location to another.

• Warehouses store products until needed.

Okay, so admittedly that’s very basic. So, why not take a key ingredient and complete a supply chain map for it. Identify everyone and everything involved in getting that product to your door, successfully.

You can then start to build up more of a picture around the vulnerabilities in your supply chain.

But wait, that’s not simplifying things, that sounds complicated…

…yes, at first.

But once you’ve completed the exercise, you will have a much clearer understanding of the whole supply chain ecosystem. Although it sounds counterintuitive, this helps to simplify things in your mind.

Identify Common Challenges in Supply Chain Management

Managing a global supply chain means you will inevitably face several common challenges:

• Delays: These can be caused by production issues, logistical problems, or unexpected demand changes.

• Miscommunication: This often happens when information is not shared effectively across different parts of the supply chain.

• Inventory Issues: Overstocking leads to high holding costs, while understocking can result in lost sales.

Take the supply chain map you put together above and start to pinpoint areas where these sorts of challenges may take place. You’ll no doubt start to think of some ways to reduce the impact should they happen.

It’s a good idea to hold regular reviews with your key supply chain partners to ensure all of you are aligned with your expectations.

Do you see how you are already starting to gain much better control over your supply chain?

Learn Strategies to Overcome these Common Challenges

Implement the following:

• Enhanced Communication: Use platforms that allow real-time data sharing and updates among all partners. These don’t have to be anything complicated – Slack, WhatsApp, We Chat, whatever works for you.

• Improved Forecasting: Can you better anticipate demand and adjust your supply chain activities accordingly?

• Relationship Management: Develop strong relationships with key suppliers and partners. This can lead to better service levels and more favourable terms.

If you really want to get advanced, you can look at implementing integrated supply chain management systems that combines data from various sources to provide a comprehensive overview, enabling you to make more data driven decisions.

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So, there you have it. A few steps to help simplify your supply chain.

By investing time in creating forms which allow potential suppliers to do a lot of the leg work for you, you can really speed up your own efficiency.

Then, by taking the time to map out your supply chain and really taking the time to understand it, you will be in a much better position to find ways to strengthen it, boost it’s efficiency, and mitigate against potential delays.

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Thanks for reading, and see you next week.

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