Managing the supply chain in the current turbulent world is increasingly becoming difficult. Various external and internal factors contribute to mismanagement and ultimate to a total disruption to the smooth functioning of the supply chain. The latest trend in Supply Chain Management is to create confidence in supply chain team members so as to mitigate risks in the process. In fact, building confidence within the supply chain management is increasingly becoming extremely important for the companies to do away with the various risks involved in the process. Very often, issues and problems in the chain happens because the supply chain members are not confident and are in tandems about some unforeseen events erupting at the last hour; and these leads to a lot of man made mistakes which could have been avoided. In addition, the end-to-end visibility and real time information is extremely critical.
Lack of Confidence=Rise in Risks
Globalization of the market, shorter product and technology life cycles, uncertainties in demand and supply, complex international supply network comprising of logistics etc—all have led to great risks in the supply chain management. And if you add chaos and nervousness to then chances of making wrong decisions exist in every stage of the supply chain.
Issues like lack of information and visibility in the process ends with lack of confidence that often leads to a breakdown of the chain. Some of the typical pain-points for the supply chain members are:
• Can the suppliers deliver?
• Is the quality of products is good?
• Is the demand forecasts correct?
• What is the current status of the order?
• What is the order cycle time?
The lack of confidence in the supply chain leads to the following risks mentioned below:
Finance & Market:
• Stocking up inventories
• Obsolete inventories
• Incorrect markdowns
• Less supplies
• Changes in users taste or preference
• Missing existing and new opportunities
Chaos & Decision:
• Unsure whether a decision is correct or wrong
• Overreacting
• Mistrusting and second guessing
• Intervening and overreacting
Confidence Building Measure
Companies have woken up to the fact that having an effective supply chain management also means to have a team confident in the process. There are a number of solutions available in the market that can not only create an effective supply chain management process but can also make the information available to the members which in turn can increase confidence and mitigate risks. The supply chain management solutions should have the following:
• Availability of real time and accurate information
• All the relevant data should be accessible to all
• Whenever there is an issue or problem, the appropriate team should be alerted
• The supply chain members should have the right tool to respond and troubleshoot
• The demand and pipeline inventory should be visible to all the concerned teams
• Whenever the products are going out of stock, the appropriate teams should be alerted
Effective supply chain management solutions from companies like Oracle can power information-driven supply chains, predict market requirements, innovate in response to volatile market conditions, and align operations across global networks. In addition, Oracle’s supply chain management solutions provides industry-specific solutions based on best-in-class applications that span product development, demand management, sales and operations planning, transportation management, and supply management.
Conclusion
The supply chain is often exposed to market risks, and it would fail to correctly respond to changing market trends and user preferences if the right market signals are not detected at the right and appropriate time. And if the right information and data is not available all the time or in real time, there are chances of problems and issues at each stage of the supply chain. The best bet is to have an appropriate supply chain management solution that would have the companies take control of the whole operations and hence increase the supply chain confidence.
