Managers, industry experts and researches, have demonstrated that supply chains are driven by cost, delivery and quality concerns. It is true that this approach have worked well for years, but in the most recent, and in the coming years, it have not, and it won’t be enough effort for companies to succeed in these complex markets.
The old supply chain concept focuses in price, while the new concept recommends that the supply chain must be designed and managed to deliver outcomes. These outcomes, according supply chain researches, several surveys and workshops, recommends that supply chains must provide at least one of six outcomes:
• Cost: reduce cost of the product, ensure on ...view middle of the document...
Reducing cost, or having low cost as the “competitive advantage” of a company is a big mistake, because it can be easily replicated, and it is almost impossible to maintain this advantage in the long run. Supply chain managers must understand the needs of critical customers and be proactive to streamline the processes between the supply chain design and the customer’s needs.
This article explains very well the current supply chain trends and the future consequences of not driving supply chains to have more than one of the explained outcomes. On my work and entrepreneur experience, I have seen how most small and mid-size businesses, to focus their efforts mainly in reducing costs, then in on-time delivery, and sometimes in product quality, but their sales team often offers the customer a quality product, on-time delivery and at the “most competitive” price, generating a big gap between customer’s expectations and the real results. Managers need to understand that product quality, on-time delivery and low cost are part...