Supply chain management is, in essence, the science of predicting the unpredictable. Leaders within the field need to be a combination of a meteorologist, a logistics expert and a business consultant.
It’s certainly not a role for the faint of heart. But there have been some promising developments in supply chain management over the past few years in the form of business software. While technology alone can’t tell you, for instance, exactly how many customers will place an order in a week, it can help you anticipate many of the field’s most common issues and intervene before disaster occurs.
Still skeptical about the power of supply chain management software? Here are a few prominent supply chain problems it can help you solve in an instant.
- Not Knowing When to Replenish Stock
It’s perhaps the question that looms largest in supply chain management: When do I contact my supplier to re-stock?
There are a number of stock replenishment strategies employed by firms across the country. Some only order at specific times throughout the year. Others wait until stock levels reach a predetermined point. Unfortunately, each of these strategies have their pitfalls. Unexpected levels of customer demand, be it lower or higher than expected, can quickly expose the flaws in any strategy.
Of course, your company can’t afford to over or understock. Too much stock means you’re paying more than necessary for inventory. Understocking, on the other hands, usually leads to your company losing a customer at least temporarily, if not permanently.
Modern supply chain management software can vastly improve your ordering process by analyzing data from past sales cycles and then using the analysis to generate forecasts for future sales periods. It will save you the time previously spent crunching the numbers and eliminate the potential for human error.
- Supplier Relationship Turmoil
Maintaining relationships with external constituents is far from an easy task. They ultimately have their own incentives to pursue and policies to follow. Sometimes, these interests can run into conflict with your own.
One simple way to build and maintain relationships with suppliers is through clear and open communication on matters ranging from bidding on contracts to compliance with your each other’s company policies.
It shouldn’t come as a surprise modern business technology can help. Quality supply chain software offers suppliers an easy portal to bid for your services. It also allows them to easily share any restrictions they might have related to their own company policies. This level of transparency will help both sides avoid miscommunication and allow for more long term relationships as opposed to one-time, transactional encounters.
- Lack of Supply Visibility
Even small businesses can become incredibly complex. You could, for example, own a warehouse, distribution and store front. If there’s a sudden uptick in demand for deliveries but the vast majority of your stock is housed at the storefront, you’re in a difficult situation.
Visibility offers the simplest way to optimize supply at each of your company’s properties. By simply knowing how many units of any item you have at each facility, you can quickly reallocate resources in the event of an unanticipated surge in demand at one facility. Supply chain management software makes it simple.
A good supply chain software system will allow you to observe your stock at each facility as well as the current level of demand and adjust in the moment. In the long run, this will help all of your facilities avoid stock outs and ensure you’re not wasting your company’s valuable inventory.
You probably aren’t surprised to learn Microsoft Dynamics 365 Business Central can mitigate, if not eliminate, all of the above concerns. With advanced analytical features and artificial intelligence capable of monitoring supplies across your business, Dynamics 365 Business Central can move your supply chain into the 21st century.
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