Supply Chain Council of European Union |

To maximize your supply chain ROI, executives must understand it

One of the biggest issues many companies face these days is that while there can be a big internal push to adopt new processes or technologies, they’re not always easy to understand. This issue may be particularly evident when it comes to the supply chain, because its many moving parts requires a deep level of understanding for everyone involved. That may be particularly true for the executives making these decisions in the first place.

The good news is that, increasingly, companies recognize the need for a strong approach to solving their supply chain issues, but all too often, the executives behind the decisions may not comprehend the full implications of each choice they make, according to supply chain expert Joyce Mazero, writing for Forbes. For that reason, it’s important to get a perspective from the people who deal with the company’s supply chain issues on a daily basis.

As with many other things in business, this is not a “set it and forget it” proposition, the report said. The lines of communications between the boardroom and those actually making direct contact with partners in the supply chain day-to-day should be open, with managers able to check in regularly and those on the ground being able to raise concerns easily.

The best boardroom decisions involve people from outside the boardroom.The best boardroom decisions involve people from outside the boardroom.

What’s needed?
The majority of companies in the supply chain increasingly see the need for improvement as demand for their services grows, according to a new survey from Project44. Today, 85% of executives at companies engaged in B2B transactions felt under pressure to expand or otherwise improve their delivery capabilities, and 79% say they know they’re using less-than-ideal processes to manage production, logistics and so on.

As such, 73% of those polled said they feel pressure to improve these processes as a direct result of changing expectations, but there’s a disconnect inside those businesses, the report said. For instance, while 82% of direct supply chain managers say this is an issue, that view is only shared by 57% of executives, potentially highlighting the remove the latter has from the situation on the ground.

What’s at stake?
All this comes at a time when companies are investing heavily in supply chain efficiency, so the greater understanding between managers and executives is a must, according to Brink News. After all, if execs are making big-money investments in new technology that doesn’t necessarily address
their current and future needs, that’s a potentially costly misstep.

The more executives can do to understand the risks they face in the ever-evolving world of supply chain optimization, the better off they will be when it comes to tackling these issues, making their firms more cost-efficient, and increasing their standing in the market, the report said.

When decision-makers put processes in place enable a stronger connection between themselves and the issues their employees face on a daily basis, they make it easier to take the next step as an organization and keep up with not just the competition, but also their supply chain partners’ expectations.

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