Supply chains are how we bring goods to market. Each step, from sourcing to manufacturing to delivery, presents unique challenges. And if something goes wrong at one point, it can disrupt the whole system.
Supply chain management is how we keep the process flowing. But the supply chain is evolving. Our global, on-demand economy requires a dynamic, scalable approach.
And tomorrow will bring more challenges. Are you ready?
End to End (E2E) supply chain management is how you keep up today and prepare for tomorrow. Here’s what you need to know about this future-ready approach to supply chain management.
What is Supply Chain Management?
Traditional supply chains work as a series of individual, isolated functions that rely on human interaction and intervention to function. Each step in the process operates separately from the others. Communication between functions is often minimal or nonexistent.
The inherent flaws in the traditional model are obvious. Handling a breakdown in one function is slow and labor-intensive. That can leave those further down the chain waiting for materials or stock. It also gives those before the breakdown time to create an overload of supplies.
Traditional supply chain methodology isn’t very efficient. Without timely coordination between steps, late shipments and early deliveries can throw the whole system off.
How E2E Changes the SCM Process
End to End (E2E) supply chain management uses an integrative approach with open lines of communication between functions. And the entire supply chain is managed as a single entity.
From process design and manufacture to delivery and customer service, each function is managed as it relates to the E2E process. That way, if there’s a slowdown in one phase, the entire process can quickly adapt to accommodate it.
E2E relies on an open communication model. This allows you to share information across the supply chain network. Plus, the E2E process is bi-directional. So, product defects go straight back to manufacturing for correction.
The integration and open communication of an E2E strategy let you better analyze issues in current supply chain processes. That allows you to identify troubles spots more quickly, then rapidly implement solutions. It also allows you to better predict and plan for market changes.
Better coordination of functions in an E2E supply chain environment reduces delays and risks. E2E also reduces costs by removing waste in the supply chain process.
Technology like electronic data interchange (EDI) gives supply chain managers a direct line to each link in the chain. And it automates processes like procurement and order processing.
Optimizing E2E Supply Chain Management
Although E2E supply chain management is an integrated process, optimizing it requires tweaking each phase individually. Then examining how each tweak affects the other aspects of the chain.
There are five basic steps in the E2E supply chain. These include:
You need a firm understanding of the journey your product will take from raw materials all the way to your customer.
The first part of sourcing is forecasting demand. That might involve market research, customer feedback, and sales data. Accurately predicting demand allows you to adjust raw material or inventory buys to match.
You must manufacture your product or receive it from a manufacturing source. Inventory management is a key part of this phase. Ensuring that products are available at the appropriate rate for demand is essential to efficient operations.
This step involves logistics, warehousing, and sales. Getting your products to your customers on time requires careful planning and coordination between all functions, from sourcing to sales.
Building customer returns and defective product protocols into your supply chain strategy ensures you build stronger relationships with your customers. It also allows you to quickly detect and correct manufacturing process errors because a defective product goes directly back to manufacturing.
For E2E supply chains to work efficiently, you must keep track of all the moving parts. Today’s advanced communication systems and automated processes can facilitate this.
Technology Streamlines E2E Process
EDI’s two-way communication model makes your supply chain run more efficiently. That lets you focus on building stronger relationships with suppliers, manufacturers, and customers.
Data Communication Solutions has the EDI solutions you need to get ahead today and stay ahead tomorrow. Contact us to learn how our EDI solutions can help you take your E2E supply chain to the next level.