Even in the best of economic times, managing the supply chain can be incredibly difficult. Sure, it’s great when your business has more orders than it knows what to do with, but at the same time you’ve got to deal with capacity issues and meeting shipping requirements. At least with those challenges you can fall back on the fact that business is booming and that it’s worth all the work.
Profit is the Main Concern During a Bad Economy
In tough economic times, it’s actually the same story. Same issues as when the economy is booming, but reversed. Less orders, too much inventory and low production are just as difficult to manage, but you have the uncertain future of profitability on your mind. When it comes down to it, that’s the main reason most people own businesses and work for those businesses: profit. If profit is in question, then all hands have to be on deck to come up with a solution. What can be done?
Stephen Dombroski, Senior Marketing Manager at QAD, recently wrote the article The Key to Managing the Supply Chain in Challenging Economic Times for Supply Chain Dive, where he explains the importance of focusing on planning and scheduling processes in order to avoid disruption. An organized plan of attack is necessary, and by focusing on processes you can be sure to have departmental coordination with everyone in the organization on the same page. We all know that things tend run smoother when everyone is “in the know” versus a siloed in a fragmented approach.
Planning and Scheduling is Key While Managing the Supply Chain
So where do you start to focus on these processes? It’s important to take a step back and investigate how your business is currently running. Stephen provides some tips to do so:
- Plan and project future production and long-term inventory positions
- Create the usage requirements for work in process (WIP) and raw material inventories
- Determine the long-term staffing and asset requirements for managing labor costs
- Analyze if the business plan and forecast can be met and identify excess capacity
- Set capacity and production rules for the production schedule
Read Stephen’s full article for more tips to optimize your planning and scheduling processes in order to thrive during turbulent economic times.