The solution to improved network resiliency, supply and demand planning, accounting prowess, and visibility into logistics stem from a common factor. These advantages in the supply chain rely on advanced systems, including a transportation management system (TMS), that work to improve operational excellence and avoid unnecessary risks. As companies look to combat the effects of supply chain disruption—regardless of whether it’s the latest move by a competitor or a public health event—the use of supply chain optimization will remain paramount to success. Shippers and logistics service professionals need to understand the problem in maintaining substandard optimization efforts, how robust capabilities add value, and a few best practices to achieve top-notch results.
The Problem With Maintaining the Status Quo
Failure to collect, capture, and analyze data with the help of automation, will amount to over-ordering or poor carrier selection. The total landed costs of goods will rapidly spiral out of control, and shippers and logistics service providers will be left holding a higher freight bill and lower profit reports. In fact, failure to optimize operations will leave up to 40% of freight spend on the table, says Cardinal Health in Becker’s Hospital Review, and that represents a huge value that could be used to keep product price points under control, work with more carriers, and build a better, more productive workforce. Ultimately, supply chain optimization can transform the dismal outlook into an opportunity to achieve business growth.
Supply Chain Optimization Resources Improve Freight Operations
The sentiment over supply chain optimization continues, which as explained by Shreyas Bhat via Inbound Logistics, derives from its strategic value:
Tips to Overcome Obstacles Through Supply Chain Optimization
Countless opportunities to optimize supply chains exist. According to Steven Bowen of the Forbes Council, these include:
- Redefining the supply chain to broaden the scope of supply chain excellence and optimizing the end-to-end supply chain, reviewing procurement through reverse logistics, and even looking at the customer experience and its impact on efficiency or productivity.
- Leveraging a cross-functional team that will visualize and make informed decisions with how to respond to supply chain disruptions and accommodate sudden peaks or lulls in operations; such activities must rely on data and reporting capabilities that transcend the barriers of working from home or working remote third-party locations around the globe.
- Tracking the right metrics to increase visibility, hold supply chain partners accountable, and identify the effects, including both short-term and long-term results, of such performance and visibility initiatives.
- Working with the C-Suite to understand supply chain needs and operate within budget restraints, not to mention making technology improvements where necessary and build an appropriate, data-driven business case for such investments.
- Deploying a SaaS-based TMS that connects suppliers, vendors, customers, and your company in one platform; collaboration and automation within the platform must enable turn-key operations to track and improve route selection, rating, accounting, and more.
- Let robotics process automation handle the day-to-day activities, reducing reliance on manual labor and resources and improving efficiency along the way.