Supply chain integration is more critical than ever in a highly transparent, globalized business world. Traditionally, supply chains, especially in large enterprises, operate in silos. Coordinating far-flung activities in different locales into a dedicated, centralized management framework was either outside the purview of most companies or difficult to implement. However, the hands-off mentality that once prevailed in the supply chain has come under fire in recent years.
Many of the issues that supply chain management now contends with are uniquely contemporary. Hyperactive media cycles lead to more reported incidents and deeper investigative coverage. However, the rapid turnover of news virtually ensures that the first details that emerge, even if they are not accurate, are likely to stick in the public imagination. While lax management practices may have had regulatory consequences before, the degree of public disapproval that can rise today is certainly more intense than in previous times. Supply chain issues like last year's horse meat contamination scandal and the collapse of a factory in Bangladesh highlight the damage that one company can incur even if the mishap was no fault of its own.
Other issues are unintended consequences of technological breakthroughs. The credit card data breaches that have rocked Target, Neiman Marcus and other companies in the past few months simply would not have occurred without the innovations that allow for mobile banking. However, neither the cultural or technological factors contributing to the need for more tightly controlled supply chain integration show any signs of letting up. Organizations should figure out how to take stock of their operational process,IT processes and business logic that contribute to the supply chain sooner rather than later.
Supply chain integration for centralized management
Enhancing supply chain management strategies does more than just cut down on the likelihood of organizational blind spots that can have a negative impact on a company's reputation. It also allows organizations to implement comprehensive initiatives and projects for increased efficiency and sustainability. In decentralized supply chain management systems, this sort of reform is difficult to achieve, as improvements are isolated in the silos that adopt them or lose something in transition to other departments. It can certainly be difficult to streamline all supply chain stakeholders and put them on the path to similar objectives.
Supply chain management software provides an able support system for organizations trying to implement sustainability, quality and cost improvement techniques on a large scale. One of the familiar rallying cries of big data - "you can't manage what you don't measure" - is highly applicable here. Collecting data from all stages of the supply chain can help organizations better target inefficiencies through intelligent, comparative analysis. This also increases transparency within organizations, as stakeholders are more aware of how their output and operational capacity affects all stakeholders. It can help companies increase the amount of attention paid to more minor players on the supply chain, either rewarding strong performance or correcting inefficiencies.
In a recent piece for Apparel, product lifecycle management expert Laura McCann Ramsey reflected on the need for transparency in both the strategic planning and execution process of supply chain integration:
"Supply chain transparency is about making today better, with an eye to the future," Ramsey wrote. "With a commitment to innovation and the desire to embed sustainability best practices into product development and manufacturing, our day-to-day systems and processes can transcend 'business as usual' through a balanced approach to product development and supply chain operations that takes into account environmental, social, quality and cost impacts."
Supply chain integration ramps up security
Enterprise networks are only as safe as their weakest endpoint. As supply chains grow, so do the number of devices and network connections that could serve as a cybercriminal's entry point into the organization. Hundreds or thousands of suppliers, vendors and advisors contribute to large enterprise supply chains. Without supply chain integration, these different contributors are likely to be disjointed and open to vulnerabilities. Hackers target smaller contributors that may be off of the central company's radar, according to TechNewsWorld. Additionally, an employee at one of these companies could perpetrate an inside job, which would have far-reaching consequences.
The Target breach, in fact, transpired due to a lack of comprehensive security oversight, observed TechNewsWorld. Hackers were able to swipe employee credentials, and looked no different from other supply chain personnel on the network. Comprehensive supply chain management strategies and advanced security tools, enforced at every level of the organization, could have provided critical intrusion detection and data breach prevention services that would have prevented the retailer from a prolonged, devastating attack.
Decentralized supply chains virtually ensure that the company will not have the resources or ability to establish and enforce comprehensive risk assessment and threat protection. Supply chain integration provides more oversight, making it easier to notice something amiss, respond to suspicious activity and prevent security breaches rather than simply respond to them. Over time, integrated supply chains simply provide a higher ROI for all IT, management and security objectives.
If you liked this article, check more Lightwell blogs out:
- 4 ways to make supply chain management more efficient
- CFOs: Get involved in supply chain management
- The top pressures impacting supply chain management in 2014
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