The essential guide to supply chain management best practices

Last updated:May 2017

Editor's note

Supply chain management is truly a team sport, where the ultimate goal is getting product to customers where and how they want it. Winning this game involves a lot of agile footwork, but it also requires ditching the "I can win the game alone" mentality. Each player must work together -- especially to deal with the unexpected. Strategy is crucial. And the latest tools and technology can help gain a competitive edge.

Indeed, today's supply chain management best practices are about crafting a vision of both the whole picture and the supporting actions needed to realize it. That takes working together across departments within the company and across supplier networks. Goals such as a successful omnichannel strategy, supply chain visibility and sustainability are perfect examples of achievements that are impossible without a high degree of orchestration and collaboration.

A well-oiled supply chain also increasingly incorporates sophisticated technology. From the connectedness of digital manufacturing and a digital supply chain, to analytics and internet of things (IoT) technology that can enable greater insight and visibility -- not to mention the ability to deal with disruptions -- like it or not, technology has become a differentiator and, for some, a way to catch up.

Many experts believe that trend will only continue. But none of that negates the need for a solid supply chain management strategy.

This guide to supply chain management best practices is meant to give you greater insight into all of these areas. It contains practical advice on tools, tips and other essentials you need to achieve business goals -- and to achieve big wins.

1Supply chain best practices from the inside out

Creating a holistic approach to supply chain management and enabling a collaborative mindset starts inside the company. From procurement to sales, each department is critical to success. But that success rests on the entire internal supply chain working together. One factor that inadvertently sabotages collaboration is the wrong reward system. Incentive systems must recognize the need to work together, or people will not feel they can do so.

2External supply chain functionality

In a very real sense, the competition among companies is a competition of supply chains. Efficient movement of goods and materials depends on complex interdependencies working well together, and that requires information. IoT, analytics and even traditional technology, such as ERP all play a role in surfacing and using information to gain real insight.

3Suppliers, collaboration and risk

The supply chain is an intricate web of interdependencies, and supply chain management best practices recognize the threat of a disruption -- one against which companies must have a well-developed strategy. At the center of this is a collaborative relationship with suppliers and other partners.

4Important terms related to supply chain management

Demonstrating excellence in supply chain management best practices requires a firm grasp of the terms, particularly newer ones. Here are some that you should know.