An efficient, well-run supply chain used to resemble the first manufacturing assembly line: materials moved down a single straight line from start to finish. And why not? Henry Ford introduced the first assembly line in 1913, reducing the time it took his workers to assemble a Model T car from 12.5 hours to under two. Speed, efficiency, and reliability -- three qualities factory floor managers share with supply chain and logistics pros. But as supply chains continue to expand globally and become increasingly fragmented and complex, they more closely resemble the innards of a fine Swiss watch: dozens and dozens of individual parts that all have to work together 24/7.
Achieving this level of supply chain synchronization has never been more difficult, but it is possible. For businesses looking to move up the levels you must avoid the five most common missteps to synchronization across the supply network. These often spell the difference between success and failure.
Let’s examine these five obstacles to supply chain synchronization. Notice how closely intertwined they are. One problem leads to another, and then to another, and the chain reaction continues.
Obstacle 1: Internal Silos
Too often, we work in silos within our own organizations - between departments or geographical locations, etc. And when we are not able to collaborate with our own colleagues, how can we expect to be able to do so with external partners? Enterprises that have learned to collaborate internally are the most successful in creating collaborative relationships outside of the enterprise. A company must develop internal capabilities to handle their own transactions to share information effectively if they hope to do the same with their supply chain partners.
Obstacle 2: Unreliable Data
That lack of collaboration and communication breeds mistrust - not in one another, but in the data that comes streaming into our email inboxes, shared spreadsheets, etc. The problems grow worse when partners, even those using technology that enables real-time information-sharing, place restrictions on the information that they choose to share. There may be logistical reasons for doing so, but incomplete or out-of-date frustrates all parties, and that breeds unsatisfactory relationships. Supply chain professionals have to spend their time working around poor planning with an inherent lack of trust in the data.
Obstacle 3: Lack of Visibility
No trust, an inability to collaborate to identify and solve problems make it impossible to achieve end-to-end supply chain visibility. Suppliers often don’t even know the “must arrive by date” for goods they manufacture, instead working to a “make by date” which has no bearing on how the goods need to travel to their destination. This often leads to suppliers and logistics providers being in combat over on-time order fulfilment, with both sides adopting defensive tactics.
Obstacle 4: Delayed Information
The primary factor that creates a lack of visibility and lack of trust is an inability to monitor and share information in real-time. If one partner reaches out to another for information, chances are what he gets back will be outdated and incomplete. That means decisions are made, and actions taken, on information that may be out of date. Having access to real-time data is not a luxury today, it’s a business necessity. Something as simple as setting up Google alerts or another way to automate the process of monitoring the Web for relevant “breaking news”, you and your partners need the ability to collect and share real-time data. Disruptions can happen at any time - be they weather, economic, social or political unrest, or just the dreaded “things go wrong.” The quicker you and your partners can react to something unexpected, the easier it will be to mitigate the damage.
Obstacle 5: Inability to Mitigate Disruptions
All of these factors force the supply chain to be in a state of reacting to, rather than anticipating, disruptions. Forbes magazine recently reported on one of the SCM World's “Future of Supply Chain” survey’s key findings that rated the category of “shipping/logistics disruptions” as the highest rated supply chain risk. 75 percent of respondents indicated they are somewhat or very concerned about shipping problems now and through 2017.The truth is that many companies just accept that disruption is inevitable and just extend lead times to compensate. If that’s the prevailing attitude, imagine the competitive advantages you can create if you can overcome these five obstacles.