Fail to prepare, prepare to fail: a statement that couldn’t be truer than when it comes to supply chains. Planning in the supply chain is immensely difficult, yet also immensely important. Every element of success in supply chain planning widens the profit margins, which given that they are nearly always immensely tight, is crucial. So, what should be the role of a supply chain planner?
A supply chain planner must not only prepare for what is predictable and known, but they must also prepare for the times things go wrong, or the even the unforeseen entirely. Let’s take a closer look at the role of the supply chain planners and what they do.
Supply Chain Planners – What Role Do They Play?
Look at a supply chain planner’s job description and you’ll see phrases such as ‘analysing’ and ‘predicting’. They are analytical individuals with keen attention to detail whose goal it is to help an organisation reach its goals by analysing and utilising available resources within the content of future supply and customer demand.
A great supply chain planner is the ultimate logistician. They solve the puzzles when the puzzles haven’t even been invented yet. They have their finger on the pulse of every aspect of the supply chain from the manufacturing plant to the boardroom, and from sales to logistics. They are in many ways the bridge between demand and supply.
A supply chain planner manages and monitors inventories as well as forecasting both sales and production. They are frequently the ones looking at capacity planning as well as creating production plans. There tends to be a vast amount of reporting involved.
Supply Chain Planners – What They Actually Do
Perhaps most interestingly, in amongst all the data analysis and insight, supply chain planners have to plan even when they don’t have full insight or complete information. We often think of them solely working with the ‘knowns’ but the reality is that some of their most crucial work is done with the ‘unknown’.
However, in practice, we typically see supply chain planners focusing on hunting down the data, or the latest shortage, rather than planning and acting in spite of them. Supply chain planners shouldn’t be lost in the quagmire of doing and chasing. They should be, as their name suggests, planning. By elevating planning to greater importance, there shouldn’t be as much chasing and firefighting needed.
The Most Flexible Supply Chains
In our globalised supply chains, it is far from unusual for a hurricane thousands of miles away to affect what’s going on in your part of the chain. Or a political coup, a terrorist attack, or an earthquake. What about a warehouse or manufacturing plant fire? None of these are rare or unheard-of disasters when taken on a global scale. Supply chains can’t operate with the best teenage attitude of ‘it won’t happen to me’ because it might, and maybe even will.
The supply chains that are the most effective are those that are able to flex and bend when disaster strikes, instead of snapping. The only way to do this is by having a clearly thought out contingency plan ready to swing into action when it is needed. A plan that is ready to execute can save the day whilst other similarly affected chains are still scrambling about trying to figure out what to do.
These different blueprints that lay down the processes for different scenarios take a huge amount of work, yet they are only recognised as being valuable when it’s too late. There may well be short-term benefits in terms of greater efficiency or improved customer service, but their real value isn’t recognised until they are needed – and they won’t always be needed. That makes it easy to put it off until another day, and another, and another…
Whilst managing short-term shortages does have an impact on profit margins, reputation and success, these are micro impacts. Whereas not having a blueprint in place for both likely, and unforeseen, eventualities can have a dire consequence on the health of the business. Supply chain planners do contribute to the bottom line, immensely, but rarely in a tangible way until it’s too late. If you want your supply chain to be sustainable, you need them to do their real job, not the firefighting one.
How to Enable Planners to Plan
In reality, the problem comes because planners simply don’t, on a day-to-day level, get the time to plan which they need. Instead, they are bogged down chasing the shortages and fixing short-term problems. These routine operations should simply not be in their remit. They should be thinking about the exceptions, not the frequent occurrences. They should be creating, testing, and evaluating their plans for balancing supply and demand, in conjunction with contingency planning.
The Problems in Supply Chain Planning
The biggest problem for supply chain planners comes from how valued they are from above. If the highest level of management sees and understands the need for the planners, then they should be able to more efficiently and accurately do the job they are employed to do. If there isn’t management buy-in on the need for planning itself, then the supply chain planners will spend their days firefighting the short-term problems.
There is also the problem that planning requires oversight and distance – both of which can be hard to get within the organisation itself. Sometimes it takes a third party to stand back and assess the various situations, in a global context, and with broader industry experience, to truly create plans which will prove valuable in the long term.
This is why it can be beneficial to get supply chain consultants on board, such as the supply chain planning consultants at Paul Trudgian. They can help to focus on the bigger picture to ensure you’re always working at optimal levels, whatever happens.