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How Can Operations Management Best Support Supply Chain Challenges?

Are supply chain shortages, delays and the frequent inability of businesses to respond to current demand temporary or permanent?

While the COVID-19 pandemic ushered in challenges in finding the materials businesses need to meet their needs, many experts say that this will not change anytime soon.

And those organizations that adopt an agile supply methodology may be better positioned for the current and any future supply chain shortages and delays.

“Agility reflects the ability of an organization’s supply chain to react to consumer demand, market changes and volatility and the shortening lifespan of a product range,” CIPS, the professional organization for the procurement and supply profession, noted in a recent report.

Additionally, CIPS advised, “Agile supply chains can adapt to meet unpredictable customer demand in a rapidly changing and volatile trading environment.”

Supply chain issues go hand-in-hand with inflation, and with consumer prices spiking over 7% in the past 12 months —the fastest increase in more than three decades — the Federal Reserve holds that this inflation is temporary. That is, once the pandemic-caused supply chain issues are resolved, inflation will decrease.

Yet other industry experts, including some in the Federal Reserve, believe inflation and supply chain challenges will stay with us beyond 2022.

“It’s true that prices are soaring because of the severe shortages of both goods and labor in supply chains, but based on my research, that doesn’t mean it’ll be temporary. Rather, it suggests that inflation is here to stay,” economist Craig Austin reported for NPR late in 2021.

Whether its microprocessors or electric garage doors, employees or even chicken wings, when one essential piece is missing, operations can grind to a halt. And to ignore the reality of supply chain challenges or assume they will vanish could cripple your business.

Boost Midwest knows that organizations that strategically plan for change are better able to adapt when a crisis hits. So, how can operations management best support supply chain challenges?

The same skills that operations management relied on to reduce waste and inefficiencies are also crucial to the operation’s supply chain:

  • Building relationships with key stakeholders.

  • Coordinating internal business operations.

  • Keeping up-to-date with agile management techniques.

However, adding Agile Management practices that rely on data, metrics, communication, automation and technology can make your operations processes more adaptive to supply crises — and also rapid change.

An agile operations management approach:

  • Focuses on the appropriate business metrics that prioritizes the customer.

  • Uses data to highlight key problems and measure effectiveness in the supply chain.

  • Keeps current with the latest technology and automation tools.

  • Continually develops, refines and reviews business processes.

  • Delivers updates to internal and external key stakeholders.

The goals of Agile Operations Management include:

  • Rationalizing inventory.

  • Reducing costs.

  • Build a predictable supply chain.

  • Meeting unpredictable customer demand.

  • Producing a broad product range with a fast turn-around time.

“It will be a really core competence … making sure that you can manage these scarcities and issues on the supply chain, not only on the material but also on the logistics side,” Siemens Energy CEO Christian Bruch told CNBC late in 2021.

While Siemens Energy may be a global company with over 90,000 employees, Boost Midwest has found that framework often applies to niche and medium-size business operations. Contact Boost Midwest for a free operations consultation to learn how agility in operations can position your operations for success.

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Ready to learn more about how Boost Midwest can help you optimize your project management and operations? Schedule your free consultation call with us today using our Quick Schedule Link here.

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