Trains, Planes and Two Essential Elements of a Strategic Supply Chain Management Program

Over the past 20 years, supply chain management has become a mission-critical component of a company’s success. Strategic supply chain management has the capability to significantly reduce a company’s costs, minimize risk, boost customer service, increase efficiency and improve the bottom line. However, if a company wants to succeed in today’s business environment, it must not only have insight into the supply chain, but also a deep understanding of what it means to have a strategic supply chain management program. Among the significant components, sophisticated supply chain software and employee supply chain expertise rate among the top. 

Selection is Key

Selecting and implementing the right software is not only critical to a company’s success but also essential to its entire survival. Businesses are picking up on the rising importance of selecting and implementing the right tools. In a recent Gartner study, it was stated that the supply chain management software market grew 7.1 percent to reach $8.3 billion in 2012. One game changing feature that can be attributed to this rise in the supply chain software market is the capability to implement via the cloud. Companies realize now more than ever that cloud allows them to stay current in the business climate and get the most value in less time and with lower risk. Effective supply chain management is on the radar of every successful company – whether they’re global or not. However, in order to strategically manage the supply and demand, inventory, transportation and other critical aspects of a company’s operations, it is important to have the knowledge and skill sets available within the organization.

Necessary Expertise

It is certain that, along with advanced supply chain software, corporations also need employees with the skill set to support their supply chain strategy. A recent Wall Street Journal article states that these experts are hard to come by. The article goes on to say that many universities have recently introduced undergraduate and master degree programs specifically focused on supply chain management. Additionally, many universities have partnered with software companies, such as JDA Software, to introduce and familiarize students with best-in-class solutions and tools and prepare them with real-world scenarios and typical day-to-day operations of a supply chain professional. Clearly, companies are recognizing the need for this experience and how it ultimately affects the success of their organization.

Practice Makes Perfect

Studies confirm that untrained or poorly trained users will cost significantly more to support than well-trained users. One such Gartner study concludes that 33 percent of respondents surveyed indicate lack of supply chain talent as a barrier to reaching revenue, customer services and profit goals. Sophisticated supply chain management systems require continual and reliable training programs in order to fully maximize the systems features and functionality.  Organizations need to better understand that training is a journey and not a one-time event; however, continued education is often where companies fail to invest, and in turn, risk their organizations to fall by the wayside. 

Putting it all Together

It is apparent that the success of a strategic supply chain program starts with advanced software and continues with employee training. Without these significant pieces, a company simply cannot remain a competitive and market-leading organization. Sophisticated supply chain software has the capability to provide rapid ROI, improve efficiencies and drive bottom-line savings; however, today’s market is constantly evolving and companies that don’t invest in their employees and consistently sharpen their supply chain management skills with ongoing education and training will ultimately lose their foothold and jeopardize their entire success as a company. 

  1 Comment   Comment

  1. Alejandra J.

    As a supply chain management student, I cannot agree more with your views on this field and the positive impact a responsive and optimal supply chain can have on a company. Being knowledgeable in strategic sourcing, route optimization, inventory management and forecasting (among other essential roles of SCM) is the new “it factor” global and local companies look for in new recruits. Most forward-thinking companies are noticing the opportunities in supply chain including cost savings, higher quality, shorter lead times, and most importantly, the creation or expansion of customer value. With supply chain gurus like Walmart, Target and Amazon shining bright thanks to their efficient distribution systems and supplier relations, competitors are starting to focus more on their supply chains than on marketing or accounting departments. Young students should consider SCM as a major that will most certainly provide them fruitful opportunities in the future, considering the current shortage of experts in this wonderful field.

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