Looking to increase efficiency? Hire a Supply Chain Consultant!

Looking to increase efficiency in your supply chain? It’s a challenge, because pressure of work and increased day-to-day responsibilities mean that key supply chain people do not realistically have time. It is necessary to stand back and work out what can be done to improve the efficiency of the business. You probably need to hire some help from a Supply Chain consultant!

What can a supply chain consultant do for your business?

• Provide clarity by identifying weak points and non-productive steps in your current supply chain. A clean hands-on look at your systems and processes can deliver this by also working with your staff to assess the current situation.
• Evaluate current business processes by assessing the status quo and the risks, issues and benefits against best practice. You can benefit from their knowledge and experience of various cost reduction technologies that you may not have been exposed to before.
• They design specific solutions to identified problems with you, plan the changes together and thereby ensure a successful outcome. This is especially important when the changes are cross-functional. The use and application of project management skills and proven concepts can provide you with the assurance that the proposed improvements will improve business efficiency.
• Train your key staff in new technologies and introduce best practice. Apply a skills transfer process to create self-sufficient staff.
• Work with you throughout the implementation, manage the changes and resolve any issues as they arise until you are satisfied. This could include managing cultural and language issues when working with low-cost countries.

What to consider when selecting a supply chain consultant

• Prepare a clear brief of the intended work and negotiate the fee which needs to be tied to the deliverables. Contract with the service provider to pay at intervals based on milestones achieved.
• Get involved with the selection of the consultants that will work on your project to make sure that they have the knowledge, expertise and cultural fit.
  Control the deliverables through a structured reporting mechanism which provides for remedial action.
• Consider incentives and penalties for successful completion of the project. The consultant must document the financial savings achieved through cost reduction and process improvements and must explain how they will be sustained.

Some forward planning when engaging a supply chain consultant will pay off handsomely. Technology is moving fast and external support for implementing new systems and processes is almost mandatory. If you are looking to increase efficiency, hire a supply chain consultant.

Supply chain consulting affecting bottom line

How can supply chain consulting affect your bottom line? Supply chain consultants come in all shapes and sizes and it is prudent to research their offerings carefully. Many consultants specialize by industry and some even concentrate on specific steps in the supply chain or in a given type of technology solution.

Some supply chain managers can detect their own problems. However, one challenge is the availability, visibility and accuracy of information. Poor quality of information limits the efficiency and effectiveness throughout the supply chain. What can be visible is escalating prices of raw materials and services, high labour rates and obsolete stockholdings. An external intervention is often needed to tackle these and similar issues due to the on-going pressure of day-to-day operations and lack of the appropriate skills to make improvements.

What can a supply chain consultancy do for you?

• A review of your end-to-end supply chain process. Internally it is difficult to objectively see the problems and also to explain them to stakeholders. By identifying bottlenecks and unnecessary complexities and looking for ways to eliminate these, consultants can propose solutions that can reduce costs and save effort.
• Innovating through the use of technology. Often I.T. systems do not talk to each other and different software solutions have been used to solve discrete and short-term problems over time. Consultants can diagnose how this is negatively impacting the flow of the supply chain and can propose how to solve any disconnects. Techniques such as Six Sigma and “Lean” in conjunction with new technologies such as RFID and cellular connectivity can optimize the flow in the supply chain.
• Purchasing and Inventory management. Applying best practice to purchasing using strategic sourcing processes and automating some of the procure-to-pay functions can deliver substantial savings. Inventory holding costs can be reduced through supplier stockholdings and receiving goods on a consignment basis (sale or return). Focusing on slow moving and redundant stock and limiting waste can have a direct effect on the bottom line.
• Future opportunity assessment and staffing review. Staying competitive in a rapidly changing economic environment means ensuring the right skills are on board to fulfill the strategy. Consultants can establish gaps in knowledge and experience that will impact the organization later and can propose new structures and developments plans to deal with this issue. Low cost country sourcing is becoming a reality and requires a particular skills set.

How can we measure the savings and benefits?
When engaging consultants it is prudent to tie their fees into measurable benefits. Whether it be savings in procuring goods and services, reduction in inventory or more efficient transportation, all these activities can be measured and compared to internationally published benchmarks. Ensure that you select the most capable and reputable service provider for your particular needs. That is the way that supply chain consulting can affect your bottom line, and positively.

Supply chain consultancy for Automotive Industry

Engaging a supply chain consultancy with automotive industry expertise is recommended when companies in this sector recognize a need to streamline processes in their supply chains. Automotive supply chains are complex as they have many tiers and lots of links in the chain. Although it is widely accepted that the automotive industry is a leader in running its supply chains well it is also clear that there's room for improvement. Deliveries can be late, products could be of poor quality, damaged or incorrect and warehousing and logistics can be bottlenecks.

Using technology
Global vehicle manufacturers are known to use more ERP and packaged software systems than some other industries and they have adopted and integrated more e-business tools. The best direct suppliers to the vehicle manufacturers (Tier 1 suppliers) also utilize similar technology focusing on supplier integration and the sharing of data up and down the supply chain. However, this level of sophistication is costly and benefits can only be realized if systems are implemented and used efficiently. This is where automotive supply chain consultants can play their part.

Supply chain challenges
Automotive industries are caught in the wave of globalization. The challenge is to maintain and enhance supply chain flexibility and customer responsiveness whilst chasing economies of scale and cost savings. Such significant changes in the entire supply chain require tight focus. The automotive industry supply chain works on a ‘push’ model as opposed to a ‘pull' supply chain. It is a mass production industry pushing cars out to be sold but the system is driven by the rate at which dealers order new vehicles. The consumer’s need for choice is changing the landscape and manufacturers must become more responsive to customer’s needs or lose income.

Opportunities for improvement
An external intervention can highlight areas of potential cost savings and efficiencies in the automotive industry supply chain.

• Collaborating on product design with suppliers and outsourced designers to create continuous improvement can provide cost savings.
• Operational costs can be reduced through leveraging an ERP system that gives full visibility into transactions across the entire enterprise
• Taking advantage of e-procurement solutions and electronic data interchange (EDI) will streamline financial and business transactions.
• Integrating with your automotive supply chain partners using reliable, real-time information can improve performance and flexibility.
• Successful decisions are supported by analysis and reliable and relevant information that leaves no room for misunderstanding. Quality data and its accuracy and accessibility are enablers.

Companies in the automotive industry want to improve the quality of their products, lower their costs and speed up the time to market. Meeting the challenges of today’s vehicle marketplace can be accelerated by using a supply chain consultantcy for the automotive industry.

Supply Chain Consultants

Using supply chain consultants as advisors on strategic cost reduction and how to create competitive advantage is becoming a requirement rather than a nice-to-have intervention. Most successful companies have tackled making savings in conventional ways such as achieving economies of scale, leveraging their purchasing and making obvious process improvements but they are finding that this is not enough.

Supply chains are becoming more complex all the time as the global business environment is constantly changing. To stay competitive firms need to move fast to keep ahead and innovative companies are looking deep into their supply chain structures, relationships and workflows to find long-term cost reduction solutions. For this they need help.

So here are some of the potential areas supply chain consultants can demonstrate added value:

• Technology Enablement
• People alignment
• Minimising risk
• Sustainability and green issues
• Supply Chain Integration

Using the right technologies
Technology is an enabler, not an end in itself. Advances in I.T software can provide solutions to problems that were previously too challenging for non-experts to tackle such as planning and demand management through to execution and asset management.

Supply chain experts and consultants use statistical and analytical tools applying the relevant technology to develop workable solutions. One aim is to integrate various disparate supply chain functions by streamlining the processes. An example of the successful application of technology to warehousing, inventory and logistics is the use of Radio Frequency Identification (RFID), a data collection technology that uses electronic tags for storing data. It can also be used to track humans!

Many supply chain consultants have alliance partnerships with leading vendors of I.T solutions and ERP systems and some specialize by industry sector. Clients rely on their ERP partners for supply chain advice and require them to develop customized solutions.

Using the right tools
However, sometimes clients need their supply chain consultants to provide informed and impartial advice. Consultants need to devise supply chain strategies based on an organization’s operations, resources, and other capabilities and not design solutions around the available technologies.

Analytical tools such as Six Sigma can detect defective processes and implement remedies that can reduce costs and provide efficiencies. Lean manufacturing techniques aim to eliminate waste and deliver better “value” for customers. The best consultants have qualifications and experience in using these tools and can provide quick results without major upheavals to the business.

Choosing the right supply chain consultants depends on the industry you are in, the technology you use and your appetite for continuous improvement in the supply chain.

Supply Chain experts

There are supply chain experts available to solve all your problems. Some specialize in the application of new technologies, some focus on revised strategies and better management and others use tried-and-tested tools to improve efficiencies across the supply chain. Here’s some areas that are current challenges in organizations.

Outsourcing
The outsourcing of key functions in business to low-cost countries has grown and this trend has introduced more partners and therefore more complexity into the supply chain. Raw material suppliers, service organizations and logistics sub-contractors mean more complicated processes and more “distances” that material and information must travel. Companies need to review their operating models to be more flexible and to work in a more collaborative manner so that they can fulfill customer requirements whilst benefitting from outsourcing.

Data and technology
Lack of data or errors in critical supply-chain information contribute to organizations’ inability to manage their supply chain processes effectively. Organizations need information systems that link applications across multiple partners, languages, geographies and cultures. Software collaboration tools can identify these weak links and supply chain professionals can take action to mitigate their impact. However, some of these tools come with different capabilities and degrees of difficulty in terms of implementation so often this is where expert help is needed.

Risk management
CEOs today have a new and intense focus on risk, compliance and governance and the supply chain is one key area that is under scrutiny. Increasing supplier disruptions, logistics delays, product recalls and safety issues are introducing new challenges into supply chains. Many businesses are ill-prepared to handle the rising risk levels and so external intervention from experts can provide assistance in this area.

Innovation
Day-to-day operations need to carry on so innovation can sometimes take a back seat. It is more than improving technologies, training people or streamlining a process. It requires input from suppliers, internal users, business partners and customers combined with the necessary commitment from stakeholders and executive leadership.

Often ideas are sidelined or not expanded upon because people work in silos or they are just too tied up in their own sub-process in the supply chain. Taking a step back, an external view can provide insights into how to develop and harness improvement plans.

Many organizations are dealing with these challenges and new ones like sustainability and “green” issues, environmental legislation, and supplier quality. Companies can become more competitive through structured interventions by supply chain experts.