Three Phases to Assessing Internal Supply Chains

Photo source: Image by jotoler from Pixabay

Has your company’s production been halted by the COVID-19 pandemic? Per the National Association for Manufacturers 2020 Q2 survey, respondents were asked about the specific ways that COVID-19 impacted their businesses and 59% said their supply chains were disrupted and 49% said they experienced unplanned production stops.

Manufacturers that have weathered the global pandemic the best previously invested resources to ensure their supply chains were efficient and productive. As we see most manufacturers returning and reopening production, it’s still important to review internal supply chains as supply chain strategies potentially shift through reshoring and more local to local buying. 

At APICS Milwaukee our mission is to serve supply chain professionals at all stages of their careers. We know ensuring your supply chain is efficient and productive requires constant evaluation and action. We suggest the below three phases to assessing your internal supply chain.

  1. Information Management: To assess your supply chain, it’s important to ensure your team understands and has the information supporting the fundamental concepts of supply chain management. Next, it’s imperative to access to an accurate and effective information database to help identify opportunities for improvements and measure success.
  2. Operations Management: Once you have a common understanding of supply chain components and quality data, the team should examine and assess the various elements of operations such as resource planning, materials planning, capacity planning, purchasing, shop floor control, product costing and continuous improvement efforts. 
  3. Business Management: In this final phase, executive management planning activities are addressed, which close the loop on the entire operation.  The topics covered are Business Planning, Marketing/Sales Planning, Manufacturing Planning and System Development.

One company that has had tremendous success evaluating their supply chains through the above steps is BASF. They leveraged APICS training to help educate employees at all levels and saw the following results:

  • Cost savings of approximately $60 million annually in internal logistics services

  • Order fulfillment cycle time reduced by 25 percent

  • Cost of goods sold reduced by 12 percent

  • Delivery accuracy increased 25 percent

  • Direct labor costs decreased 79 percent over 12 months

  • Return on supply chain fixed assets increased 62 percent over one year

Looking for more information on assessing your internal supply chain? Join us next week Tuesday (6/30) for a virtual Supply Chain Workshop taught by an expert APICS Instructor on the topic. This event is free for APICS Milwaukee members.

APICS Milwaukee is the premier professional association for supply chain management, helping over 180 Milwaukee area companies represented by our members, with educational and networking opportunities.  Learn more about how we do this on our website at www.apicsmilw.org.