Managing a supply chain can be a challenging task and requires the development of several activities that, if well executed, can aggregate more value to your business. In fact, through a good logistics and supply chain management, your company is able to reduce costs, improve delivery times, retain customer loyalty, increase productivity and create business opportunities.
However, there are some common management mistakes that could affect your supply chain’s performance and the results you are getting from it. For this reason, in this post, we’ll show you the 5 most common mistakes in logistics and supply chain management and what you should do to avoid them.
Establishing standard processes is important to ensure that your business’ supply chain activities meet all your specific requirements. This is also a way of applying terms and conditions that make it possible to increase your control over the processes.
Although the logistics scenario is ever-changing and it is important to constantly review and make adjustments to your processes, implementing a standard workflow can make your logistics processes more fluid and visible to all. Some ways of making your logistics and supply chain management more organized are defining work methods or using charts to define what’s expected from each stage of production.
Managers tend to only worry about analyzing their company’s performance metrics when the results achieved aren’t as expected. This attitude can lead to problems because demands in the logistics market are constantly changing, even for reasons that do not relate to your business.
Therefore, it is important to make the Key Performance Indicators (KPIs) a part of the strategy to monitor your business’ performance, productivity, sales, and quality of products and services delivered. From the metrics obtained by the KPI’s, it is possible to do things like identify and find alternatives to prepare your business in advance for the lower demand seasons.
This is one of the management errors that could cause great damage to your business’ performance. When there is a lack of communication among different sectors, the possibility of one activity negatively interfering in another is greater. For example: the production sector delays the production of a product, which impairs the transportation sector to make the products’ delivery on time. Thus, the customer will be unsatisfied.
To avoid facing issues like this, it is essential that all sectors work synergistically to ensure greater internal communication. Therefore, as a manager you must work in an integrated way to the team and other areas, establishing a channel of direct communication.
As part of this, you should constantly encourage your employees to express their opinions and share ideas, increasing their engagement and motivation in the workplace. After all, well-structured communication is the best way to avoid misunderstandings and problems due to lack of information.
A business that doesn’t rely on the appropriate technology resources could face several problems, such as inconsistencies, errors, delays, and losses.
Using specialized logistics and supply chain management systems increases the visibility of your processes and brings more precision to their execution. Among its many benefits, technology allows you to monitor each stage of the production line, reduce human force and errors, as well as optimize your operational flow through the automation of tasks. All these benefits translate into competitive advantage, data accuracy, reduction of costs, and increased security.
Companies need to accurately predict demand to avoid losing sales or having unnecessary costs due to excessive inventory. For this, it is fundamental to know the market and anticipate information about demand or retraction, as well as seasonalities.
A good way to do this is to studying sales reports and identifying the products and services with the greatest turnover. This evaluation will also enable you to analyze the customers who have decreased purchases in your company and come up with strategies to try and regain them.
Does your company make any of these logistics and supply chain management mistakes? If so, it is time to change this and achieve your full potential in the market!
And to help you do so, we have built an exclusive material with the ultimate guide to boost your sales in logistics. Fill in the form below to download it!
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