6 Ways Quality Can Strengthen Supply Chain Profitability

To thrive in today’s competitive global business environment, manufacturers must have a top-to-bottom quality-oriented approach that infuses innovative thinking into every part of the supply chain in order to deliver world-class performance through products, processes and people.

Some promising news, according to a recently published report by Forbes Insights and ASQ, is that senior executives and quality professionals see a direct connection between the success of their continuous improvement initiatives and the success of their organizations as a whole.

The Forbes Insights/ASQ research surveyed 1,869 executives and quality professionals from around the world and focused on the links between quality efforts and corporate performance, as well as the evolving business value of quality and its relationship to the supply chain. Thirty-six percent of enterprises surveyed said that they regard themselves as an established quality organization, while 39% reported that they are still developing their quality programs and 25% said they are struggling to implement quality in their companies.

For those organizations that do have established quality programs, more than half say their initiatives already encompass a range of key corporate functions, including operations and supply chain management.

This focus on quality for the supply chain is especially crucial when one recognizes that supply chain management is often motivated to achieve the least cost when identifying and qualifying new suppliers. Supply chain leaders are often rewarded for these cost-savings. But then extra costs are incurred once the final product is manufactured and delivered and it is discovered that reworks are required due to the focus on price and not quality.

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NFL Draft Lessons for Supply Chain Managers

Just like with successful football game play, having a well-developed modal selection strategy helps organizations defend against capacity concerns and score points for their bottom line by lowering transportation costs.

Every year, the NFL draft provides coaches an opportunity to re-evaluate their teams and supplement their current roster with new players to fill skill or position gaps and prepare their franchise for the future.

In a similar way, supply chain managers have the opportunity, on an ongoing basis, to review their transportation portfolio to ensure they have the right modes and processes in play to not only address the demands and the environment of today, but to face the challenges of tomorrow.

Read on to learn three important lessons supply chain leaders can learn from this year’s NFL Draft and how it applies to calling winning plays for their organization’s transportation network.

The Challenge for Supply Chain Managers

Much like NFL coaches, supply chain managers find themselves having to balance short and long term demands. Managing the demand between these two competing forces is fueled by:

  1. Ongoing disruptions: Whether on the football field or in the supply chain, disruptions can and will occur. It can be easy when everything goes according to plan, but when volatility and the unexpected cause disruption (and they always do) supply chain managers have to have a backup plan.
  2. Short-term cost-savings still primary focus: Organizations are still pressing supply chain managers to deliver more value and additional cost savings. According to a survey completed by Georgia College and the University of Tennessee, 36.7% of shippers listed reducing costs as their first priority in 2015, up from 32.2% in 2016.

Read more at NFL Draft Lessons for Supply Chain Managers

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3 ways companies can identify climate risks in supply chains

3 ways companies can identify climate risks in supply chains

Despite the enormous value at stake, climate risks in supply chains can be hard to see because they are so large. The key to getting it right, according to Acclimatise CEO John Firth, who spoke at the BSR Spring Forum last week, is for managers to address supply chain climate risks in terms of existing stressors — such as procurement costs, on-time delivery, water availability and secure energy and infrastructure.
At the Forum, speakers and participants identified three lenses that can help company managers connect climate change to existing supply chain concerns.

Vulnerable regions

The economic costs of climate-related disasters are rising, in large part because business is consolidating in vulnerable regions in the name of market growth and efficiency. It is projected that by 2070, seven of the 10 largest economic hubs will be in the developing world, and assets exposed to floods will rise from 5 percent to 9 percent of global GDP.

Categories at risk

Sustainability professionals also can address climate risk through global supply or procurement categories that are dependent on stable climatic conditions, such as crops, capital-intensive infrastructure and water-intensive operations.

Sustainability destabilizers

Finally, climate change undermines companies’ ability to address material sustainability issues. Many companies are working to improve economic development in the communities in which they operate, yet climate impacts, especially disasters, can depress job markets for years. Or, while it is typical for companies to commit to reducing greenhouse gas emissions, the lower water runoff associated with droughts can reduce the capacity of hydropower, the most mature source of renewable power

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