5 Vital Roles of Supply Chain Management in Business

Finnegan Pierson

Supply chain management is the movement of products from their place of manufacture to the consumer who ultimately purchases the product. Many businesses are involved in the supply chain, from the manufactures, the freight liners, storage facilities, distributors and ultimately to retailers who offer the product to consumers. With so many working parts to the process, it falls on the supply chain management team to ensure the success of delivery. The capabilities of a supply chain management team can have a huge impact on the success of a business. Here are crucial decisions made daily by supply chain managers.

1. Arranging Transportation

It is the job of the supply chain manager to contract with third-party logistics providers such as freight companies and shipping lines, depending on how far and where products need to be delivered. Knowledge of customs requirements and duties of other countries is required when exporting goods.

Weather can also have an impact on which provider the manager chooses to use. Freight lines are especially vulnerable in moving goods when weather causes roadways to become impassable. Armed with knowledge of winter driving tips, most skilled truckers are able to keep the supply chain moving.

2. Inventory Control

Inventory control in supply chain management means supervising the flow of goods from the places of manufacture to the retail facilities where the goods will be sold. Working with the purchasing manager, the supply chain manager supports the company’s objectives for reducing inventory costs while maintaining maximum customer satisfaction.

Item Fill Rate (IFR) is important to gauging consumer satisfaction, as it calculates the percentage of time customers are able to procure the product when ordered. Being able to calculate demand and meet that demand is crucial to the growth of the business for which a supply chain manager is employed.

3. Warehouse Management

The warehouse is where the product is stored prior to shipping and distribution. Warehouse management ensures the overall profitability of inventory. Supply chain managers influence the design and operations of the warehouse which must be organized and user-friendly. They must manage associated costs, employees, training and stocking strategies. They’re also responsible for writing and promoting policy to ensure a safe workplace that is in line with OSHA safety guidelines.

4. Communication

Perhaps the most vital role of the supply chain manager is communication. Without excellent communication skills the supply chain would fail. From conception of the product to delivery, the supply chain manager plays a key role in engaging vendors, sharing strategies and resolving issues. They also must collaborate with different teams, including sales and customer service. The supply chain manager must always be on the look-out for areas of improvement and is responsible for sharing those ideas with other corporate leaders and directors.

5. Evolving Technology

Technology is constantly evolving, and it is vital that the supply chain manager be able to keep up with the latest trends. With the boom of online retail, the role of supply chain management has become even more complex. Software has assisted in streamlining the process of delivering goods and avoiding bottlenecks in the supply chain. Technology has also given rise to real time demand and the opportunity to find creative solutions to meeting those demands so that customers receive their products in a timely fashion. Supply chain management software allows for better inventory management as well as more effective order tracking and delivery on the part of the supplier and the consumer.

Supply chain management is a complicated operation that requires knowledge of the practices of multiple business sectors. Working with manufacturers, suppliers, retailers, shippers and distributors are all part of the work of supply chain management. Communication is one of the most important qualities a supply chain manager can possess, but the ability to keep up with technology is also important. The performance of the supply chain management team of any operation impacts every step of the supply chain process.