For most companies, supply chains are a critical part for their strategic advantage. However, 80% of all companies don’t have real transparency when it comes to their supplier network. Usually there is information in different departments, but the big picture is missing. For the company this is like driving at high speeds on a foggy road. It is dangerous.
If your supply chains are an important for your business model, here is a test to see whether or not you should further investigate supply chain mapping. Give your company 1 point for each "yes" answer.
11 questions to better supply chain control
- Do you have a global view of your supply chains and can you analyze the complexity of the network?
- Do all your stakeholders (Procurement, Logistics, Supply Chain, Quality etc.) have the same understanding (and basically the same knowledge) of you supplier network?
- Does your risk management cover the entire supplier network?
- Can you identify risk gravity in reaction to an incident (i.e. insolvency or natural disaster) at a sub-supplier site?
- Can you identify places on supply chains where quality standards or compliance regulations are missing?
- Do you have a master plan in case of an incident at a supplier site?
- Do you know how a change of supplier would impact the whole supply chain?
- Can you manage the leadtime for specific products within the entire supply chain?
- Do you know the added value of your products for each step in the supply chains?
- Can you identify the critical paths in your supply chain?
- Can you use scenario planning to compare different supply chains in your network?
A score of 11 is perfect, 8 is tolerable, but 7 or lower and you've got serious problems. The truth is that most organizations are running with a score of 3 or 4, and they need serious help, because other companies run at 11 full-time.
Supply chain mapping is the basis for understanding your supplier network. Scenario planning based on this data helps you find new opportunities and be prepared for unexpected situations.
Expand your horizon – use supply chain mapping!
Pictures from Photocase
Susann Städter (Photo-ID:148478), Don Espresso (Photo-ID:205910).