Updated: Feb 2
Supply chain refers to the steps needed to get a service or product to the customer and involves people, vendors, systems, processes, and suppliers, associated with from designing to delivering a product to the customer. The larger the organization, the more mind-boggling a supply chain becomes. In contrast, the more localized or confined the business, the less complicated the supply chain. Consequently, the steadily developing intricacy of getting products to an ever-growing pool of potential customers over various platforms involves state-of-the-art supply chain management to keep up with agile, robust systems, recognize current bottlenecks, and anticipate future ones.
Notwithstanding, supply chain management can be traumatic for supply chain managers in times like these, especially in and after the wake of COVID-19. The market has become even more volatile due to the pandemic increasing the already stressed space. On the other hand, a day's delay in arriving goods can lead to the loss of many days of work in a supply chain since the great resignation has created an environment with less talent.
Identifying the Bottlenecks in a Supply Chain
Let us look at how to identify the bottlenecks of the supply chain. Fundamentally, identification is the most significant step to positive change. When a business chooses not to respond to problems it makes for a stagnant production and slower turnaround time. The thing to keep in mind is that bottlenecks include external factors affecting the process like raw materials, manufacturing, and shipment. Your supply chain is end-to-end, from ordering raw materials to the delivery to your customer, so any bottleneck in the supply chain will have a domino effect down the line.
Another reason for bottlenecks in supply chain management can be the lack of planning of the process. The best way of identifying the bottlenecks is by analyzing the previously collected data and information, through process mapping your current state. The process can be slowed if your front-line team has not been given enough instructions, tools or the right resources to effectively and efficiently do their jobs. Communication is change orders or project revisions are also a contributing factor to supply chain bottlenecks and overall business inefficiencies.
The lack of visibility remains another bottleneck with monstrous outcomes. According to a survey conducted by SupplyChain Digital, 78% of C-level executives need real-time visibility across their inventory network and supply chain. However, they still plan to put resources into intelligence, agility, and automation initiatives.
Managing the Bottlenecks in a Supply Chain
Thus, we have learned about the possible ways to recognize the bottlenecks in a supply chain. Along similar lines, let us guide you about getting rid of them by being operationally sound. Being ready to tackle the problems once they affect the supply chain is not an ideal approach.
Be proactive rather than waiting for a problem to show up to do something about it.
Bottlenecks should be predicted when the process is planned to avoid destructive consequences whenever a problem arises.
Developing layered systems to deal with different functionalities and implementing IT systems to use available information and data.
Proper planning about the availability of cash in the supply chain if a disruption occurs. Not only planning but a certain amount of cash should likewise be dedicated for emergencies.
Prioritize visibility along the supply chain, depending on the order of most noticeable financial impact.
Adopt artificial intelligence and different advanced technologies to get to the bottom of analytic value from gathered data and distinguish the bottlenecks along the supply chain.
Do not have a single-source supplier; having multiple domestic and international suppliers will assist you with becoming operationally sound.
Take advantage of bulk order discounts that are usually set on raw materials.
In addition, you should work with an import service provider to help you take your products to their destination.
Take advantage of automated tasks, driving a reliable and efficient line.
The above are the ways to identify the bottlenecks in supply chain management, which is the most crucial step to be proactive about the predictable issues. The ways to identify are followed by ways to tackle and manage the recognized bottlenecks through process mapping, which eventually helps you become operationally sound. Remember, a business might experience labor or technology shortage, so operationally sound means making fewer people and technologies more productive.
About the author:
Cornerstone Paradigm Consulting, LLC is an industry-agnostic business operations consulting firm getting to the root cause of business issues by way of process mapping. We're here to help you succeed.