I’ve spoken with more than a few company leaders lately who have told me that their network designs no longer rely so much on certainty. And even if they have conducted a network optimization within the past three years, they feel that it may already be outdated.
The Tompkins Supply Chain Consortium recently published a report on Supply Chain Network Design Practices, and it could not be timelier.
The report notes significant changes in network design practices as compared to previous years. But this does not surprise me. Businesses are changing many of their practices in order to adapt to the current economic environment.
Another key finding – companies have been decreasing the amount of time between network studies from two years to 18 months. And to their credit, the smartest organizations have made network planning a continuous process in order to keep up with shifting demands, customer requirements, transportation costs and real estate costs.
This is another reminder of the rise in complexity of today’s supply chain networks and fast-changing business environment.
And while the process is typically complex, it needs to be complex as the supply chains we are modeling are complex.
A good network design can reduce costs, improve customer service and minimize capital. Updated regularly, efficient supply chain network designs flow smoothly, distribute information, meet customer demand and contribute to profitable growth.
When did you last optimize your network? What timeframes are you dealing with today? Read the Supply Chain Network Design Practices report and let me know what you are doing to keep up with the growing complexity of global supply chains.
Jim
Resources:
Hot Topic Report: Network Design Practices - How
Sophisticated is Your Supply Chain Network?
Network
Optimization in the Supply Chain: Strategies for Reducing Costs
Warehousing
and Distribution: Finding Profitable Growth in the Supply Chain
The
Five Biggest Mistakes (and How to Avoid Them) When Optimizing the Supply Chain
Network
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Photo credit: Horia Varlan
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