Nowadays, businesses focus more on customer-centric model. Following the trend, your supply chain should also pay more attention to the end customer. Miebach study noted that companies that optimise their supply chain can potentially reduce inventory costs of total between 20 percent and 30 percent, and even reduce cost for individual items by up to 50 percent. That being said, you should optimise your supply chain to gain the most profitable scheme from your business. To do so, you need a comprehensive end-to-end (E2E) strategy with complete visibility.
Michael Raisin from Miebach Consulting wrote in his white paper that E2E service can decrease 25 percent cycle time it takes to deliver from supplier to customers, increase 10 percent service level, and increase performance of entire system. Not only that, it also heightens ability to respond at peak capacity utilisation, internal and external process transparency, as well as minimise obsolescence and depreciation expenses.
Likewise, if you want to receive more profit while spending less during the process of providing and distributing goods to the customers, you can apply the following E2E keys, according to Supply Chain Wizard, to improve and optimise your service
>> Inventory optimisation, you should assess both demand and supply variability, analyse full portfolio of products to set right inventory targets, segment products by profitability, volume, variability, life cycle, and enable tracking and reporting of KPI’s to ensure performance.
>> Distribution optimisation, you should map the end-to-end order to cash process, conduct financial analysis to find key pain points, balance distribution costs with other supply chain objectives, achieve quick-wins, while optimising for long term success.
>> Demand planning and forecasting, you should analyse current forecasting practice and accuracy metrics, highlight largest opportunities by product segment, and decide between manual vs. automation to improve accuracy, enable consensus demand planning via collaboration tools.
>> Supply planning and purchasing, you should understand key supply planning parameters, analyse historical product availability and inventory planning insights, optimise supply planning process, tools, and parameters.
>> Performance management KPIs (key performance indicators), you should build a holistic understanding of all supply chain KPIs, enhance current KPIs with “leading indicators”, and balance the KPI scorecard to deliver business objectives, enable drill-down capabilities for root-cause problem solving.
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