The three As to ensuring Supply chain success – Priority Freight

The three As to ensuring Supply chain success

To achieve success within today’s competitive markets, it’s crucial for supply chains to be at their strongest. Creating a successful supply chain is often complex and reliant on various factors.If you look closely not only do the three T’s, trust, time and transparency, influence supply chain success but the three A’s: agility, adaptability and alignment also play an important role.

Agility

A key characteristic of an agile organisation is flexibility. Indeed, the origins of agility as a business concept lie in flexible manufacturing systems (FMS). Initially it was thought that the route to manufacturing flexibility was through automation to enable rapid change (i.e. reduced set-up times) resulting in a greater responsiveness to changes in product or volume. Later this idea of manufacturing flexibility was extended into the wider business and the concept of agility as an organisational orientation was born.

In fast-paced markets, where the environment, customer preferences and competition is constantly evolving, having an agile supply chain that responds and adjusts is essential. Agility is critical, because in most industries, both demand and supply fluctuate more rapidly and widely than before. Most supply chains cope by playing speed against costs, but agile ones respond both quickly and cost-efficiently.

You should be able to rely on your logistics partners for support in all complex and urgent logistical challenges at every level of the supply chain. Having an open and collaborative relationship with your logistics provider is key when creating an agile supply chain where elements outside of your control are being problematic.

When using a time-critical logistics supplier you have to have a close working relationship and be confident that they follow your interests. Here at Priority Freight, we are united by one common goal – to discover the best freight logistics possible and make your freight our priority.

Adaptability

Adaptability is the long-term perspective regarding the response to market changes. Most companies don’t realise that in addition to unexpected changes in supply and demand, supply chains also face near-permanent changes in markets. Those structural shifts usually occur because of economic progress, political and social change, demographic trends, and technological advances. Unless companies adapt their supply chains, they won’t stay competitive for very long.

Efficient utilisation of technology and capacity, establishing a strategic partnership with logistic partners and structural changes in the supply chain network are among the key factors, which need monitoring to turn a company into a future-ready business. Adaptation can be tough, but it’s critical in developing a supply chain that delivers a sustainable advantage.

The best supply chains identify structural shifts, sometimes before they occur, by capturing the latest data, filtering out noise, and tracking key patterns. This enables you to then relocate facilities, change sources of supplies, and, if possible, outsource manufacturing which is when you need to rely heavily on your logistics provider and have confidence in their ability to deliver a solution effectively.

Alignment

Great companies take care to align the interests of all the firms in their supply chain with their own. Collaboration with suppliers and customers is key to taking a mature supply chain to the next level and the importance of collaboration cannot be over stated. Effective and seamless collaboration helps when getting critical alerts, such as over commitment of supplier capacity and supplier/distributor resource balancing. When one part of the supply chain has interests different from the rest of the supply chain, its actions will not maximise the supply chains performance.

Starting with the alignment of information, allowing all the companies in a supply chain equal access to forecasts, sales data, and plans. Next align identities; in other words, the manufacturer must define the roles and responsibilities of each partner so that there is no scope for conflict. Companies then must align incentives, so that when companies try to maximise returns, they also maximise the supply chain’s performance. To ensure that happens, companies must try to predict the possible behaviour of supply chain partners in the light of their current incentives. Companies often perform such analyses to predict what competitors would do if they raised prices or entered a new segment; they need to do the same with their supply chain partners. Then they must redesign incentives so partners act in ways that are closer to what’s best for the entire supply chain.

When using a time-critical logistics supplier you have to have a close working relationship and be confident that they follow your interests. Here at Priority Freight, we are united by one common goal – to discover the best freight logistics possible and make your freight our priority.

Priority Freight
Posted on 7th September 2017, By Aimee Hawkes
Read about Aimee Hawkes

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