When it comes to supply chain management, an organization’s supply is the lifeblood that keeps it running. Especially for electronics-based manufacturing, supply management requires a careful balance between too much and too little to keep the supply chain flowing smoothly. No matter your application, however, as a supply chain pro, you need to optimize supply levels to ensure that you meet customer demand while simultaneously minimizing costs, no simple task to be sure.
In this article, we’ll explore how you can balance the scales of supply management and keep your supply chain in balance.
The Importance of Days Supply On-Hand
Days supply on-hand (DIOH) is a critical metric for supply chain and sourcing pros, measuring the number of days of supply a company has on hand at any given time. High DIOH can lead to increased costs associated with storage, handling, and obsolescence, while a low DIOH can result in stockouts, lost sales, and unhappy customers.
To balance the scales of supply management, you need to strike a balance between these two extremes. You need a deep understanding of your product portfolio, customer demand, lead times, and other factors that affect supply levels.
How a 360-Degree, Fully Connected View of Data Can Help
To achieve a balance between high and low DIOH, you need a 360-degree, fully connected view of your data. This means that you need to have a complete view of your supply across all your locations and channels, as well as data on customer demand, supplier performance, and other key factors that impact supply levels.
Think of this view of data as a crystal ball that helps you see into the future. With the right data, you can predict customer demand, identify trends, and adjust supply levels accordingly. You can also use data to monitor supplier performance, optimize replenishment processes, and reduce the risk of obsolescence.
To achieve this, you need a robust platform that provides real-time visibility into your supply levels, risk and spend data, and other critical information. Moreover, this system should integrate with your ERP, PLM, CRM, and other enterprise systems to provide a complete view of your supply chain.
Balancing the Scales of Supply Management
Balancing the scales of supply management requires a holistic approach. You need to optimize supply levels while also minimizing costs, reducing waste, and improving customer satisfaction. Here are a few tips to help you achieve this balance:
Prioritize Supply Management
Make supply management a priority by setting clear goals, measuring progress, and rewarding success.
Leverage Data
Use data to predict demand, monitor supplier performance, and optimize replenishment processes.
Adopt a Lean Approach: Use lean principles to minimize waste and improve efficiency in your supply chain.
Focus on Customer Needs
Keep customer needs at the forefront of your decision-making process and adjust supply levels accordingly.
The Bottom Line: Embrace Technology
Balancing the scales of supply management is a critical task for supply chain professionals. By achieving a balance between high and low DIOH, you can ensure that your company meets customer needs while minimizing costs. To achieve this balance, you need a 360-degree, fully connected view of your data, which can be achieved through the implementation of a comprehensive supply management platform that integrates with your enterprise systems. By prioritizing supply levels, leveraging data, adopting a lean approach, focusing on customer needs, and embracing technology, you can keep your supply chain in balance and optimize your supply levels.
