Personalized supply chain! The link between your company silos!

How many parts of your business act as independent business silos? How many functions in your organization behave like islands?

One of the main problems in a functionally organized company is that these functions can become isolated from each other over time. The responsibilities, metrics, skills, strategy, and mandates for each function can lead employees to place their functional focus above the overall organizational goals.

But the supply chain team is uniquely positioned to bridge all of these silos and islands. The supply chain is truly the glue that can hold your business together!

Whenever I have joined a new company, I have often heard and observed that employees across functions are not working as well as they should. Organizational lines and boxes on a piece of paper become actual boundaries and obstacles to real-life teamwork and productivity.

The finance team has their priorities, the marketing team has their focus, the operations team does their own thing, and sales does something completely different.

When the organization is truly dysfunctional, each of these functions works past one another, pointing the finger at the shortcomings of other groups and fundamentally undermining the entire organization’s ability to succeed. Business silos are unproductive and destructive.

There is obviously no room for such behavior in a high-performance organization. Each individual and team must work in harmony to achieve the company’s overall goals. This does not mean that there are no disagreements or disagreements. It means that high-performing teams have figured out how to address these issues, rise above them, and continue their push forward.

The role of the supply chain in addressing business silos

The term “Supply Chain” is more than just the name of the group that manages material and logistics. And “Supply Chain” is more than just a characterization of the flow between suppliers and your company and your customers. “Supply Chain” also reflects the leadership role this team can and should play in unifying your business!

The supply chain interacts with every aspect of your business in a unique way at a given point in time.

design and development

The development of new products must be supported by the supply chain team, which works closely with design and development. The supply chain must find and qualify suppliers, manage the introduction of new components, materials and products, and coordinate the logistics of those suppliers, raw materials and products.

finance

The interaction of supply chain and finance must be close and harmonious in a well-functioning organization. The supply chain team largely controls the largest spend in many companies. The procurement of materials, goods and services and the timing of that procurement, payment terms with suppliers, and the building and disposition of inventory all dramatically affect the amount of cash a company has and uses.

Management of the Sales, Inventory and Operations Planning (SIOP) process within an organization dictates all tactical and strategic resource planning at all levels. And the supply chain’s ability to successfully and competitively negotiate costs can have a direct impact on a company’s bottom line.

The supply chain must work closely with finance to keep the company running efficiently.

manufacturing plants

If your company has either in-house or outsourced manufacturing operations, these facilities are entirely dependent on the supply chain to ensure materials arrive on time at specified grades.

The supply chain must coordinate the flow of goods across the entire end-to-end supply chain from suppliers to internal operations to customers.

IT

Much of the backbone of any business is found in the IT systems that enable it to operate. And the core of these systems can often be found in the supply chain. ERP/MRP, WMS, TMS, SIOP and other systems provide the platform for electronic transmission of information along the supply chain.

IT is more than just the back office function that keeps the computers running and your email working. The supply chain and IT teams together create the foundation for an organization to deploy tools and skills that can provide competitive differentiation, customer satisfaction and financial excellence.

Customer Teams/Marketing/Call Centers

Depending on your industry, the supply chain team needs to be closely connected to the customer teams. When you ship products to customers, you need to provide that transparency to customers and customer service representatives. And that visibility is enabled and provided by the logistics team within your supply chain group.

The supply chain team manages the flow of goods and materials, as well as the transportation and logistics to move those goods. Commitments to deliveries to customers certainly require input from the supply chain team, if not the actual commitment itself.

Nobody wants to disappoint a customer or miss a commitment to a customer. Therefore, it is imperative that the supply chain team works closely with all customer-facing groups.

Corporate silos – conclusion

The supply chain team interacts with virtually every part of your business. The above examples are intended to be illustrative and not exhaustive. But it is clear that supply chain is an integral part of your business.

Many companies are less efficient than they could be because many of the functions within the organization act as corporate silos, which is highly destructive behavior.

The supply chain team needs to recognize their unique ability to provide leadership beyond their direct responsibilities. Supply Chain works with every part of your business.

Therefore, the supply chain must function across all silos and organizational boundaries and dissolve them. Supply chain leadership is a core element of any high performing organization.

Originally published January 2, 2018.

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