Everyone knows the value of an annual physical or regular checkup by their primary care physician to determine the general status of their health. The exam also gives a person the chance to talk about any ongoing pain or symptoms or health concerns they may have. As everyone knows—playing a proactive role in your healthcare can only lead to improvements in your overall health.
Taking care of the health of your supply chain is equally important and can be done through an audit/assessment. Depending on your needs and goals, these can be done internally or by an external source. There are different types of audits but each one has the same goal of increasing efficiencies and reducing costs.
Supplier audits – provide a comprehensive look at supply chain performance to identify the strongest and weakest vendors. Do they have the product/parts that you need? Are deliveries made on time? Are their costs competitive?
Factory audits – help determine whether manufacturers have met, are meeting or will be able to meet the needs and demands of their organization, especially in light of all of the supply chain disruptions that have arisen in the last 18 months.
Carrier audit – will ensure that the carrier costs are competitive and that the company’s freight bills are accurate and error free. The value of this type of audit has risen dramatically given the recent increase in freight costs.
3PL Assessment – helps a company determine whether the 3PL is providing them with value commensurate to the fees charged for their services. For many companies, the use of a 3PL has been dictated by the need to reduce service costs while enhancing customer service performance. A 3PL Assessment helps a company determine whether the 3PL is providing them with value commensurate to the cost charged for their services.
My personal favorite is the Supply Chain Assessment, which sounds less adversarial than an audit. An assessment is one of the most powerful methods of evaluating and possibly improving supply chains, and can include reducing operational costs, correcting pain points, identifying bottlenecks so supply chain flexibility, capability and overall efficiency can be increased.
Such an effort can determine where businesses need to focus to ensure they can enhance their processes and operations in their planning, transportation, warehousing, distribution and manufacturing functions. This can include an end to end assessment of an entire supply chain or a more focused assessment on a “sub-segment” of a supply chain.
Assessments can identify gaps between current methods’ performance and best practices as well as map out a desired future state for your supply chain and develop a roadmap to migrate to the future state.
There is never a bad time to examine, evaluate and possibly improve your supply chain, reduce operational cost and increase your competitive advantage.
—Deb Stratton, St. Onge Company