Companies use multiple tactics to generate economic profit, including introducing new products, launching marketing campaigns or undertaking acquisitions. Supply chains offer an effective, though less understood, path to creating value through growth, driving down working capital, improving cash flow and lowering cost.
Surprisingly few companies understand the importance of the supply chain, and few have a formal strategy in place for managing global supply chain risk in the years ahead. This is especially dangerous given the volatility and uncertainty in trade relations between the U.S. and China, as well as other scenarios around the world. Besides geopolitical uncertainty, having the right talent, a holistic perspective and appropriate technology may all figure into the supply chain risk factor.
Use the following best practices to optimize your supply chain and minimize risk.
Redefine The Supply Chain
Best practices begin with redefining supply chain excellence and broadening its scope.
Create A Cross-Functional Team
Best practices for driving shareholder value through supply chain optimization can be easily implemented in any company for concrete results.
Focus On The Right Metrics
Following increased visibility and cross-functional team-making, focusing on the right metrics is the logical next step.
Connect With The C-Suite
Another essential best practice in supply chain optimization is building relationships throughout the entire company and starting conversations with the CFO and other key executives.
Manage Risks
Long-standing supply relationships have value, but disruption of those relationships can be devastating.
Total Value Optimization
The Total Value Optimization (TVO) framework promotes greater collaboration, integration and transparency.
Read more at Six Ways To Optimize Your Supply Chain To Generate Profit
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