6 Best Ways to Optimize Supply Chain Management

by Josh Biggs in Tips on 22nd October 2019

A supply chain includes many people, organizations, activities, resources and information. It is a network that allows the supplier to send the final product to the buyer. There are many steps involved to convert raw materials into final products. Supply chain management plays a pivotal role in the business, as it can faster the production cycle and reduce costs too.

A supply chain includes a series of steps, they are needed to get a finished product delivered to the customers. These steps include transforming raw materials into finished products, transporting the products from the warehouse and finally delivering the products to the customer. The supply chain starts by receiving an order from your customer.

Why is supply chain important?

The supply chain includes functions such as product development, operations, marketing, distribution channels, finance and customer service. It is a chain system and they are dependent on each other. If one of them breaks down, it can affect the entire chain and can increase costs for the organization too.

Supply chain management has a lot of potential to boost your customer experience. How? You must be wondering. When you cut down the delay in delivering your products and providing the products at a low cost then your customers would become your loyal customers. When your customers are satisfied you can easily gain a competitive advantage over your competitors.

There are so many entities involved in the supply chain process i.e., warehouses, vendors, distribution channels , retailers. So you must work collaboratively with all of them to deliver your product to targeted customers. The cost of a product includes material cost, labour cost. If you have supply chain management in place you can reduce both the complexity and cost of the manufacturing process. The evolution of the supply chain has played a significant role in repressing the inflation.

Why must you optimize your supply chain?

If you’re planning to optimize your supply chain, you must look at the entire process. The supply chain has also changed a lot over the years with the introduction to networks, internet technologies and other tools. The technology has truly given a hand in bringing true collaborations between the suppliers, distributors and partners. It has become highly important for manufactures also to evolve when it comes to optimizing the process. Most people have come to understand how their complex, competitive supply chains can face trade-offs and challenges. In any situation, supply chain optimization will help you manage costs, stays lean and instantaneously responds to any fluctuations or demands in the market.

Here are the 6 ways to optimize supply chain management

Concentrate on your core strength

Most organizations forget that handling too many tasks can get daunting. They can outsource the repetitive or not so important tasks. Instead of concentrating on the multiple tasks, if you concentrate more on the important tasks that no third party can perform you can save time and concentrate on more important tasks. It is proved that using your company’s internal resources can only help you in the short run. If you rely on a third party for repetitive work you will have time to improve your core strength and concentrate on more efficient ways to improve customer experience.

Employee development

Employees are the most valuable assets for any business. They’re even more important in companies with supply chains. Every single day they face many operational pressures. But that shouldn’t stop the company from focusing on developing their employee’s skill set. Companies can take a step by investing in their skills enhancement and training. They can rotate highly efficient staff through multiple job assignments to get them accustomed to the supply chain, so they can help you in developing the high-level supply chain.

Direct communication

In a supply chain, there are many people involved. If you want your supply chain management to work seamlessly without any interruptions, it is important to establish open or direct communication. When more than 2 or 3 people are involved in a process, there are high chances of things going downhill due to a misunderstanding between the parties involved. It is your responsibility to ensure that clear communication comes through you. When you’re in the loop, every part of the loop should communicate effectively, not the one part. When your line of communication is clear most of your work will be delivered on time without any delays.

Inventory management

You’re not the only party involved in the supply chain. Some suppliers supply everything you need at a low cost. If you don’t keep your supplier informed about the demand for your products, they may not carry enough inventory or sometimes carry too much. Either of them will do no good for your business. Because if your suppliers are carrying too much inventory, it simply means that they have spent a lot of money on it and ultimately the burden will come on you.

So to avoid such situations share your demand information with your supplier, so they can have their plans to optimize the inventory management and it would not put the cost burden on both of you. You need to understand the financial implications of both situations i.e. when you place or revise an order. If you’re collaborative with your supplier/manufacturer it will help you in reducing costs, provide your customers with quality products and make sure the products are available.


If you want your organization to stay connected with its audience, then you must bring innovation into the picture. Technology plays a major role in business development. If you want to communicate you can’t always rely on mobile phones as there is always a possibility of another person not responding. It is important to always maintain quicker communication.

As every second is precious in a business, it becomes important for businesses to use the latest updated technologies to make working easy. There are many AI-based technologies now available in the market that would assist you in keeping track of your orders and inventory, depending on your organization’s size you can select the applications that will fulfil all your business necessities.


Logistics also play a huge part in your supply chain. It is not just about transporting goods from one location to the other, there is more to it than that. You must keep in mind the customers demand also, make sure that the products reach them fast and safe without any damage. Since all the functions in the supply chain are interlinked.

You must make sure that all of them function properly to not affect the logistics as it is the last step. If you want your customers to experience to be excellent then make sure you deliver the goods on time with perfect condition. Make sure you always maintain spare parts in your vehicle, in case they break down on the way to delivery. Hire drivers who are experienced and can handle the vehicle breakdowns well.


Supply chain management is the most important for a business. The more streamlined the whole process is the more helpful it is. Supply chain management can reduce costs, speed up the production cycle and lastly improve customer experience. It is important to optimize your supply chain management to ensure that everything works according to your plan.

Categories: Tips