Several Ways to Improve Supply Chain Performance

Several Ways to Improve Supply Chain Performance

In previous writing, we have seen that there are two types of flow that exist in a supply chain, namely "physical" flow and "information" flow.

In general, we can see the function of the two streams:

1. Physical flow or flow of goods/materials is to ensure the right type of goods/materials, in the right quantity, and the right quality that meets the requirements of the buyer. Activities in this flow are buying, making, and moving.

2. The flow of information is to ascertain what items are needed, in what quantity, when, and where they are needed.

3. In principle, all activities in the supply chain are in response to information from the flow mentioned above.

4. We have also seen that there are five basic components of supply chain management namely plan, source supply, create, deliver and return goods.

Of the five basic components, we can see that there are three important parts, namely:

1. Procurement and order management

The source of goods/materials is important information for companies to meet their needs and/or the needs of buyers. From this information, we can make further plans for the delivery of the goods/materials.

2. Transportation

Transportation is an important component to ensure goods/materials move efficiently at the right time to meet the desired needs.

3. Warehouse and inventory

This component is also a key component of the supply chain process. The warehouse stores every inventory in the supply chain.

Improving supply chain performance is about how companies can ensure a more effective and efficient physical flow (goods/materials) and information flow and remove all possible obstacles that will affect the two flows mentioned above.

Here are some ways to improve supply chain performance:

Improve and enhance good communication with all parties, both internal and external. Poor communication will cause various problems, for example, delays in meeting consumer needs.

This includes how we can share relevant information with related parties. We also must provide correct information to parties in need, you should always double-check before providing certain information, for example, misinformation can lead to errors in sending goods to consumers.

Improve coordination and manage well all existing links in the supply chain, both internal and external. This includes increasing knowledge about supply chain management.

Establish a good reporting system. One example is creating a good database, which contains all information on the movement of goods/materials from the procurement, storage, transportation to the end/purchase point.

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