The global economy is unpredictable and the Covid-19 pandemic has disrupted supply chains and has continued to affect most industries. Energy prices have increased sharply due to demand, leading to costs being reduced. pushed up, the consequence is that the prices of raw materials used for production will be pushed up, especially for imported materials when transportation costs also increase. In other words, organizations need to effectively coordinate assets as goods, services, and information are transferred from suppliers to customers. At the same time, companies need to forecast future demand and balance supply and demand.
Why do you need automated supply chain planning and control?
Many organizations rely on supply chain management systems (SMC-Supply Chain Management) to predict future purchasing behavior. These tools have a number of different features that help balance product supply with customer demand, including:
- Forecasting function
- Inventory management function
- Ability to optimize pricing
SCM software automates both supply chain planning (SCP) and supply chain execution (SCE). SCP is the process by which business leaders make informed decisions about their supply chain based on data from manufacturing, logistics and inventory, while SCE is the act of executing daily operations. dates related to the company's supply chain.
An SCM system helps ensure that your supply chain planning and execution is based on a standardized set of processes. With this standardization, all stakeholders can work to improve supply chain performance and company profitability.
SCM tools also solve the problem of waste on unnecessary processes. When you automate, streamline, and simplify SCP with the right technology, you can reduce this waste.
When your supply chain is optimized and automated, your customers benefit. You can offer personalized service, lower prices and faster delivery – three factors that directly influence where they spend their money.
What influences the supply chain planning and control process?
Before purchasing an SCM system, you should first understand your supply chain processes. There are several overall processes that comprise a company's SCP approach:
- Demand planning
This is the process of creating forward-looking sales forecasts based on historical data and other reliable information, such as point-of-sale (POS) activity. As users enter data into the SCM system, reports are automatically generated to organize information, identify patterns, and provide visibility into future requirements. This allows companies to predict changes in buyer behavior and prepare for these changes or proactively steer customers in a different direction. For example, if data suggests demand is likely to decline, marketing teams can limit this decline by offering incentives, such as discounts or product substitutions. - Production planning
Once the SCM software provides the necessary insights, the supply chain team can create a related demand plan. This can then be converted into a corresponding production plan, which clearly outlines the steps needed to satisfy each decision-making detail. - Supply chain implementation
Once this plan is in place, the supply chain execution process begins. Sometimes, a company will outsource certain supply chain tasks, such as distribution or order fulfillment, to third-party logistics (3PL) providers. These are companies that specialize in specific functions that many organizations are not set up to handle on their own or cannot perform at an economical pace.
The way to automate your supply chain planning is to Optimize your processes and then implement an ERP or SCM system that can help you achieve supply chain success.
- Many organizations integrate these two platforms as part of their best-practice strategy. This allows companies to use a variety of planning and forecasting tools with advanced functionality.
- Many ERP systems are equipped with functions that provide a high level of supply chain control. These tools help users simplify supply chain processes and make every touchpoint more transparent.
- Implementing such an “All-In-One” solution means you avoid potential integration challenges and ensure seamless data flow between your supply chain functions and functional areas. other ability. This allows:
- Improved inventory management
- Improve relationships with suppliers, customers and supply chain partners
- The purchasing process is simpler and streamlined
- Advanced supplier evaluation process
The supply chain is your lifeline. It includes many different resources and stakeholders, all working together to move your company forward and keep your customers happy. However, the opposite is also true. A messy supply chain can negatively impact brand reputation, customer satisfaction, and the bottom line. With the right supply chain planning and control tools, you can avoid these risks.
