What Is Sourcing and Supply Chain Management

4 min read
Dec 27, 2023 2:23:00 PM

Want to succeed in business? Then you need an effective supply chain management strategy.  

But that’s not easy. Customer demands are increasing, the need for customized products is higher than ever, and with globalization, our supply chain has never been so complex.  

Even with all those challenges, an effective supply chain management system will ensure the best quality, minimize costs and waste, and reduce time spent in production. Moreover, the better the supply chain management, the more protected your business and brand’s reputation will be.  

Whether you are new to supply chain management or hope to improve your current system, here are some tips to help your brand develop a successful supply chain strategy.  

Decide on Your Goals 

Setting goals is the first step in developing a successful sourcing and supply chain strategy. Once the goals are in place, determine the efficient amount of inventory and expected or necessary daily production output.  

By determining your company's goals, you can also create marketing tools and develop sales strategies to reach those goals. Having goals in place will also help you align different department operations to meet the supply chain plan.  

Do Market and Industry Research 

Doing market research will help you keep abreast of trends that could affect supply and demand. By anticipating future demands, you can more accurately determine inventory requirements, storage volume and logistical needs. Conducting research will also help you prevent supply or product shortages and ensure the final products will still be relevant and meet the customer’s expectations.  

This is where an effective and knowledgeable partner can help. They have resources in the industry that you may not have, and can keep you updated on the latest information. Don’t be afraid to ask questions of your contacts and build a network of experts. 

Embrace Technology   

Don’t be afraid of new technology. 96% of industry leaders agree that innovation is extremely important to growth.   

Technology is essential for operation efficiency, successful sourcing and supply chain management. Since the goal for successful operations should be to look for ways of becoming more streamlined, staying current on the latest technology and training employees on how to use it is necessary.  

Look at integrating your current technology stack. Pull relevant data from different systems and have a way of analyzing it. For example, your CRM may have a sales board that forecasts upcoming sales and orders that you can use to get a head start on material orders. Or, maintenance records may give you an idea of why you are seeing higher material use because a machine is older and in need of replacement. 

This work may yield additional benefits. For example, you could save up to 10% in IT costs alone by utilizing cloud technology. Furthermore, integration tools will enhance in-organization communication, and implementing mobility tools can cut additional costs by large percentages.  

Analyze and Use Your Data  

Regularly gather data on your supply chain for actionable information that will help you make important decisions, including how you manage your supply chain. For example, if you know a shipment is going to be late, then look at adjusting the production schedule to compensate. Tracking the movement of your supply chain will help you make improvements where needed and fix problems before they happen.  

By analyzing your data, you will make informed decisions and avoid costly pitfalls. Once key performance indicators (KPIs) are in place, analyze data to measure cost performance, staff productivity, process efficiency, lead and cycle time, and quality.   

Support Employees 

Celebrate your employees by giving them what they need to succeed. Offering employee training will help them feel more invested in your company and its success. Often, your employees who are on the front line of production will have the best ideas for optimizing your work and improving supply chain management. Have a way to find and nurture those ideas and reward employees for what they do. 

Understand Customer Needs 

Before investing in tools, learn what your customers require. This way, you can create a process to harmonize with those requirements.  

One way to learn about your customers’ needs is through surveys. Conducting surveys can give you better insight into what products or services might be successful for you to plan accordingly.  

For example, if you learn that your customers require expedited shipping, you will need a shipping plan to meet this need. To accomplish this, you must synchronize planning, production, warehouse, sales, and logistics.  

Embrace Adaptability 

The supply chain is still vulnerable. While there are things you can prepare for, there are things you cannot.  

For this reason, make it your goal to either be flexible in whatever comes your way or to continue to function regardless of the daily changes. Have a contingency plan and workarounds ready if you need them. Make sure to have additional employees knowledgeable of your supply chain processes and partners you can trust when things get tight. Rather than relying on the lowest-cost providers, build a relationship with the partner you can trust to help when you need it. 

Work with a Managed Service Partner 

You don’t have to be a supply chain expert to succeed in this market. Let us help you. 

GO2 Partners is a team of dedicated specialists with the tools and experience to help you evolve your supply chain processes. Our services will help you uncover inefficiencies and enable your teams to execute, deliver and unlock opportunities in every supply chain step. Our supply chain services include: 

  • Sourcing and Category Management — Strategic sourcing to help you spend less and buy smarter.  
  • Supplier Relationship Management — Enhance your procurement team’s reach with vendor relationship management services and solutions. 
  • Procurement Audits and Compliance — Reduce risks with our procurement process, audit and recovery. 
  • Strategic Procurement Transformation — Deliver lasting growth with sustainable results. 
  • Supplier Identification — Provide continuous growth with geography-based assessments, supplier identification and qualification services.  
  • Spend Analysis — Improve your spending management and savings through collecting, cleaning, classifying and analyzing data.  
  • Contingency-based Cost Reduction — Risk-free, expert procurement services without the up-front costs.  
  • Procurement Staffing and BPO — Boost the agility and productivity of your business with on-demand strategic sourcing resources when you need them.   
  • Market Assessments and Benchmarking — Make intelligent, actionable decisions and negotiations with the expertise of AI.  

 Contact us today to learn more!  

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