EFFICIENT AND effective supply chain management relies on a range of factors. Stuart Emmett of Learn & Change UK has condensed these into eight rules which he presented at the recent Sapics “Supply Chain Vitality” conference held in Sun City.
Rule 1 The buy/make/move/sell processes are all inter-related and interconnected and all internal and external connections must therefore be viewed as a whole.
Rule 2 Inventory is the common component of all supply chains. Fixed lead times are critical. The format of inventory and where it is held is of common interest to all supply chain players and must be jointly investigated and examined.
Rule 3 SCM requires co-ordination of all players. The optimum and the ideal cost/service balance will only ever be found by working and collaborating fully with all players in the supply chain.
Rule 4 Time is cash, cash flow is critical and so are the goods and information flows. Fixed, reliable lead times are more important than the length of the lead time.
Rule 5 Serving the customer is the reason to be in business. It is their demand that drives the whole supply chain - finding out what customers value and then delivering it is critical.
Rule 6 Supply chain management is about flow and it is only the movement to the customer that brings the ultimate value. Everything else adds cost. Smooth, continuous flow movements are preferable.
Rule 7 Taking a total, holistic view of the cost/service balance from the customer’s perspective is key. Trade-offs are possible by looking holistically outside the box.
Rule 8 Information is needed for decision-making - it lubricates the supply chain. Using appropriate ICT is critical.
