Choosing supply chain technology is the most important decision a logistics manager makes in his or her career. Why? Simply because the right software solution can propel a company forward, regardless of how bad the economy is, while the wrong one may bury the business for good. Unfortunately, selecting the best supply chain management (SCM) system can be difficult.
Selecting a SCM System
Never has so much technology been developed to help organizations improve supply chain performance. Yet, the performance of most supply chains has never been worse. Due to poor coordination and planning, dysfunctional industry practices, and high costs resulting from adversarial relations among partners, most supply chain organizations generate low profit margins, surviving, not thriving. To help you choose the right SCM system for your company, the rest of this post delineates the steps you should follow in the selection process.
Assess Your Needs
When choosing supply chain technology, it’s imperative to understand your organization”s needs. Although most SCM systems deliver a complex set of modules, allowing companies to manage different business areas, ranging from financials, manufacturing, inventory, transportation, marketing, and sales to human resources and customer management, not all solutions are the same. What can you do to choose a solution that best suits your organization? Instead of developing a time-consuming list of features your organization may need, you should create SCM narratives by verifying how your employees perform their daily tasks. This approach will provide a lot more context for the features you need in order to achieve specific short- and long-term objectives regarding productivity, revenue, cost, and customer service.
Understand the Impact of Technology
Implementing a SCM system into your organization will have a significant impact on different areas, affecting business growth. Will the solution deliver powerful yet user-friendly functionality? Is it scalable and flexible enough to support horizontal and vertical growth? Can it help you streamline processes, improve productivity, increase efficiency, and reduce costs to boost revenue and profit? Although your organization will be affected by competition, trends in the industry, and volatility of the global market, asking yourself all these questions is imperative to find a solution that delivers exceptional agility so that you can offer your customers unparalleled service.
Read Unbiased Reviews
Most vendors will provide you with comprehensive information about the supply chain technology they sell only if you know what questions to ask. If you know very little about SCM systems, the best thing you can do is to read reviews and case studies published by unbiased sources. Some topics to research include the capabilities, benefits, and drawbacks of the SCM system you plan to get; vendor costs for data migration, customization, training, and support; software licensing options and hardware requirements; and the reasons why SCM implementation fails.
When searching for the right supply chain technology, a few additional factors you should consider include:
- Visibility – Getting in-depth insight into the business operations not only allows you to control different processes, but also gives you the confidence that the best decisions are made at the most opportune moment.
- Collaboration – Opting for a SCM solution that encourages collaboration enable employees to work in a pleasant yet productive environment.
- Flexibility – A SCM system should support feature selection, module development, and policy and formulas modifications.
- Scalability – To facilitate growth, a SCM solution should provide a reliable scalable infrastructure, functioning both on premise and in the cloud.
It’s true that finding a suitable supply chain technology for your company takes a lot of time and hard work. However, it’s also true that getting the right SCM solution can bring extraordinary benefits.