Executive Briefings

The Need to Optimize Supply Chain Networks

So different from those of the past, today's supply chains require new strategy, analysis and planning, says Steve Martin, vice president of supply chain excellence at Ryder System. He discusses current marketplace realities and their impact on sourcing, sustainability, and inventory optimization in the midst of unpredictable demand.

Challenges to supply chain efficiency today must seem endless. Begin with the length of such networks these days. They span the globe, bridging different time zones and cultures, both of a business and political nature. Throw in sourcing from low-cost markets, fragmentation of vitally important data, and a larger number of participants in any transaction than ever before. Speed-to-market pressures pose additional hurdles. SKU proliferation, the emphasis on sustainability. Oh, and by the way, the economy hasn't been so great in the past year or two.

"In general, supply chains have continued to become more complex," says Martin, " so our planning, strategy and analysis have had to change."

This can be daunting for some who can remember when planning efforts could evolve over a couple of years. Now, what-if scenarios and a holistic approach are needed; things can't wait. Dynamic analysis support tools may be called for, Martin says.

Risk is significantly higher, and the consequences of failure may be orders of magnitude greater than before. Supplier failure is likely to be the greatest risk any company can face, but security factors - and the costly government mandates that accompany them - have to be taken into account.

All of which calls for optimizing the supply chain network, Martin says. He feels such initiatives aren't optional, but the time and money invested in them pay off in a number of ways in any event. For instance, sustainability is top of many minds in business these days. "Supply chain network optimization has its green effects if done properly," he says.

To view this video interview in its entirety, Click Here.

Challenges to supply chain efficiency today must seem endless. Begin with the length of such networks these days. They span the globe, bridging different time zones and cultures, both of a business and political nature. Throw in sourcing from low-cost markets, fragmentation of vitally important data, and a larger number of participants in any transaction than ever before. Speed-to-market pressures pose additional hurdles. SKU proliferation, the emphasis on sustainability. Oh, and by the way, the economy hasn't been so great in the past year or two.

"In general, supply chains have continued to become more complex," says Martin, " so our planning, strategy and analysis have had to change."

This can be daunting for some who can remember when planning efforts could evolve over a couple of years. Now, what-if scenarios and a holistic approach are needed; things can't wait. Dynamic analysis support tools may be called for, Martin says.

Risk is significantly higher, and the consequences of failure may be orders of magnitude greater than before. Supplier failure is likely to be the greatest risk any company can face, but security factors - and the costly government mandates that accompany them - have to be taken into account.

All of which calls for optimizing the supply chain network, Martin says. He feels such initiatives aren't optional, but the time and money invested in them pay off in a number of ways in any event. For instance, sustainability is top of many minds in business these days. "Supply chain network optimization has its green effects if done properly," he says.

To view this video interview in its entirety, Click Here.