A supply chain is a structure and a process combined into a system including planning, people, resources, organizations, data/information and the surrounding activities that are necessary for the production and delivery of a product or service from a supplier to an end user/customer. Supply chains, by their nature are becoming more global than ever before.

What is Supply Chain Management?
Take the time to carefully detail (in graphic form) your supply chain. Sometimes a picture is worth a “thousand words.” Be sure to include every part of your organization that is involved in any way and ensure that those departments or individuals understand their role in making the supply chain efficient, cost- effective and supportive of the organization’s supply chain.

“Supply chain management (SCM) is the active management of supply chain activities to maximize customer value and achieve a sustainable competitive advantage. It represents a conscious effort by the supply chain firms to develop and run supply chains in the most effective and efficient ways possible. Supply chain activities cover everything from product development, sourcing, production, and logistics as well as the information systems needed to coordinate these activities.” – Supply Chain Resource Cooperative, Poole College of Management,
North Carolina State.

Production re-structuring for your Supply Chain – only part of the solution. Consumer behavior is subject to changing attitudes and trends. “Made in the USA” is driving suppliers of component parts as well as the end products to be produced with higher USA content.

Recent changes in production prices in various markets outside the USA and the tariff application (amount and timing) on certain goods has resulted in significant changes to costs and equally important, the uncertainty of those costs resulting in a major impact on profitability and market share.

The term “Reshoring” (sometimes referred to as “Onshoring”, “Inshoring” or “Backshoring”) where production of components and/or finished goods are brought back to the US (or home domicile of the company) is sometimes used as one of the recent tools to take advantage of the “Made in the USA” trend or manage exposure to the changing tariff landscape. And, without question “Made in the USA” products are still the choice of many consumers around the world. But this is only part of the solution. A more holistic approach to managing your supply chain is necessary.

Evaluating and Re-Engineering Your Supply Chain

A significant amount of focus has been directed towards supply chain management recently, including expanded course offerings in colleges, certifications of supply chain professionals, product-specific training, management structuring and redesign within the  supply chain process and many other efforts. Our experience has highlighted several key areas that seem to rise above the rest in terms of importance in the evaluation and/or re-engineering of your supply chain:

  •  Visibility of the Supply Chain for the Organization
    Take the time to carefully detail (in graphic form) your supply chain. Sometimes a picture is worth a “thousand words.” Be sure to include every part of your organization that is involved in any way and ensure that those departments or individuals understand their role in making the supply chain efficient, cost- effective and supportive of the organization’s supply chain.
  • Visibility of the Supply Chain to Executive Management and Stakeholders
    Just as cybersecurity has risen out of IT departments and into the Board Room in recent years, so should the supply chain for an organization. As the supply chain drives many financial and operational results, timely and accurate Information, trends and changes affecting the organization’s supply chain need to be elevated to the chief decision makers who have the ability to make changes and set direction that is favorable to the organization going forward.
  •  Accurate and Timely Data Gathering, Analysis and Reporting
    Real time, accurate data (a digital foundation) providing a view into the performance of an organization’s supply chain is critical to decision making and taking appropriate action required for an efficient, cost-effective supply chain supporting the organization’s objectives.

Some have said that technology with sensors and elements of artificial intelligence may replace traditional supply chain management:

Clearly, the death of supply chain management as we know it is on the horizon. The managers and companies working to update their skills and processes today are the ones who will come out on top.” – The Death of Supply Chain Management, Harvard Business Review, June 15, 2018.

  •  Visibility of the Environment within which the Supply Chain Operates
    Obtaining timely and accurate knowledge through focused internal resources, outside professionals and consultants related to the environment in which your organization’s supply chain operates is critical to managing the organization’s supply chain. This would include changes in tariffs, duties and taxes, cost trends, country political risks, competitor supply chain information, etc..
  • Culture of Agility and Flexibility for the Supply Chain of the Organization
    Perhaps one of the most important of all, agility and flexibility within the organization’s supply chain. As is often the case, an organization cannot anticipate changes that may be out of their control and so the ability to act quickly to make changes and redirect the process is critical. This includes things such as buying terms and contracts, inventory management, alternate supplier planning, clear critical data visibility, etc.

Supply chain management is critical to the success of an organization. Knowledgeable, experienced team members together with objective (often 3 rd party) evaluations and reviews of the current supply chain are absolutely critical to avoid costly financial missteps and legal/regulatory issues buried in the complexities of current-day supply chains.

Howorth International

We provide specific resources on a project by project basis. Where required, we engage industry experts and other outside professionals (research firms, regulatory specialists, in-country experts, attorneys, tax and accounting, human capital experts and others) as needed for a project. We are able to operate in a cost-effective manner in virtually any
industry, while providing highly-qualified resources for a project. In addition, we work as an extension of an organization from the planning and evaluation stages through the implementation of management approved changes.

Lawrence P. Howorth is President and Founder of HOWORTH
International, LLC, (www.HOWORTHLLC.com) a 25 year old multinational provider of Interim, part time (fractional) and project management and advisory services.
Tel: (562) 544-5300
Email:Lawrence@HOWORTHLLC.com

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