Leveraging Supply Chain Engineering During Unexpected Disruptions
June 17, 2020
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Sometimes the world doesn’t make much sense and we find our supply chains responding unexpectedly. In the last decade, the rate of change has increased, and disruptions are becoming more common, impacting the way we do business. Leveraging supply chain engineering enables shippers to apply optimization and technology both tactically and strategically to logistics, reducing costs and often yielding a competitive advantage.
But where to start?
A baseline analysis, like the ones Schneider does for many shippers, provides crisp visibility to the current supply chain and identifies opportunities for further review. These opportunities may be a result of:
A recent disruption
A merger, growth, new products or even simply
Changing market conditions
One of the most frequent opportunities that comes out of the baseline analysis work is strategic footprint and location analysis. These answer questions about how many manufacturing or warehouse locations a supply chain needs, and where those facilities should be located.
In cases where shippers have established optimal footprints, the next opportunity is usually about sourcing; on the inbound shipping side, optimizing which suppliers should be used and how to best get the product from their facilities and on the outbound side, optimizing the assignments from warehouses to customers for order fulfillment. Tactical opportunities often include route design, freight consolidation, mode selection, private fleet utilization and zone skipping.
If you don’t feel your organization has the in-house talent to conduct this type of work (and many don’t), consider looking to a third-party logistics provider with Supply Chain Management services like Schneider. Our team of engineers typically identify between 5 and 15% in supply chain savings potential as an outcome of these projects and can guide you through implementing the savings opportunities with project recommendations and roadmaps.
In this ever-changing world it is imperative that supply chains be agile, flexible and resilient. Check back next week for a real-life example of how a company mitigated risk in their supply chain with an engineering study.
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