In the supply chain, it’s all for one and one for all! Or is it? Sadly, while we all need to work together to achieve a single goal (getting goods to customers), competition has often prevented effective collaboration. It’s time to end that forever and reap the rewards of uniting supply chain partners for sustainable growth. This article shares why growth is so critical and how to unite successfully to attain growth.
Why Growth is so Critical in the Supply Chain
Every company’s goal is to make a profit. Most companies prioritize growth to achieve this. Yes, growth is critical to business expansion, but it isn’t just about increased production and consumption. Businesses can also grow in wisdom, experience, and knowledge. Shifting a perspective or engaging in a new approach can improve profitability.
In some cases, such as embracing technology to improve effective rebate management, knowledge, growth, and profitability can go hand in hand.
The German philosopher Eckhart Tolle is known for saying, “Evolve or die.” Massive supply chain disruption, varying consumer demand, the shift to e-commerce, and the exposure of how little visibility there has been in the supply chain have exposed retailers to supply chain risk – hampering growth of all kinds.
Strategies to Unite Supply Chain Partners
McKinsey says that companies with advanced supplier-collaboration capabilities tend to outperform their peers by approximately double in growth and other metrics. How do they improve supply chain collaboration? A group of high-performing supply chain experts came together at a summit of leaders hosted at Harvard University to discuss this topic. Together, they identified five ways to unite supply chain partners and serve customers better and published these in Supply Chain Management Review (SCMR). Their tips are: find your purpose, balance the core and the new, unleash the power of human + machine, share the supply chain with the ecosystem, and retool talent and teams. We break them down, below
SCMR says, “Your supply chain is no longer just a means to get products from Point A to Point B. It needs to be the vehicle to enable your company’s purpose.” This sounds beautiful. But what does it mean in reality? Simply: customers find you more credible, and collaboration is easier when your supply chain partners share your vision.
One way of focusing all supply chain partners on this purpose is to create relevant deals and incentives that serve mutually-beneficial goals. This often starts with joint business planning initiatives that foster alignment on performance metrics, targets, and key strategies for the year.
“As supply chains become digital, networked and centered on customer outcomes, COOs and CSCOs need to keep one foot in the present (for stability) and one in the future (for innovation),” SCMR reports. We agree.
Much has been written about the risks of lagging behind your competitors. For example, an article on key factors driving the digital adoption of rebate management notes that outdated systems increase the risk of human errors, reduced compliance, and even revenue leakage. Fortunately, some software providers can proactively support organizations as they manage the transition between old, clunky tools and new, streamlined operations.
3. Human + machine
Forward-looking organizations know that what SCMR says is true: “Technology has become more than a tool—it’s a means to help supply chain leaders imagine what is possible and, more importantly, achieve it.” Supplier collaboration is key to enhancing this success on a bigger scale. Regarding rebate management, for example, a lack of clarity across rebate deals, complicated admin challenges, and disorganized deal information can create or exacerbate schisms between trading partners.
The alternative is using humans and machines to work together effectively. Key practices for supplier and distributor collaboration ensure agreements are recorded in a standardized way, sales data and business activity forecasts are shared, and common processes make rebates so easy to sign off.
But, as SCMR notes, “it is essential to experiment with new technology that can augment the work of people who then can spend more time on innovation that fosters growth.”
It has been said, “If you want to go fast, go alone. If you want to go far, go together.” SCMR says, “no business leader needs to go it alone in today’s shared economy,” and when supply chain partners are united in the pursuit of growth, they shouldn’t have to. By shifting from ‘my supply chain’ to ‘our supply chain,’ the entire ecosystem becomes a progressive support network.
The Enable founder, Andrew Butt, puts it like this: “My vision is to empower thriving partner ecosystems of manufacturers, distributors, and retailers where people can find the best products, services, and value. My mission is to enable trusted trading relationships that service customers better together.”
Enable may provide a tool to remove the administrative burden of rebates and harness their strategic potential, but we’re so much more than just rebate management. We believe in uniting trading partners through seamless collaboration. Become part of our community, and you’ll discover this for yourself.
5. Retooling talent
SCMR says, “Teams must be retooled with the right skills to support the supply chain of the future.” Citing one of the participants at their event, they point out, “Companies must look at skills relevant for the new normal. What made us successful yesterday may not be what takes us forward.”
A future-looking supply chain taps into the diverse skill sets of all participants across the network. No one needs to be an expert in every aspect of the supply chain. It would be impossible to attempt it! That’s why partnerships exist, to leverage each supply chain participant’s expertise.
SCMR calls it a ‘patchwork of talent.’ But leveraging the right talent also requires leveraging the right technology. No one can do everything. But the right, connected software can help share insights, effort, and programs to leverage knowledge and effectiveness for the benefit of all supply chain partners.
How Can Supply Chain Partners Unite to Attain Growth?
As SCMR says, “Technology is evolving at warp speed. Consumer preferences are fickle and fast-changing. And the supply chain workforce is in the middle of a transformation.” Now is the time for courage. Investing in the right technology will pay dividends (for example, rebate management software customers have seen an average ROI of 400% over three years). But this will not be achieved without effort, collaboration, trust, and commitment.
McKinsey puts it succinctly: “The turbulence of the past two years has forced many organizations to address vulnerabilities in their complex, highly globalized supply networks.” But rebates can actually unite supply partners. So it’s no surprise that, according to Gartner, 77% of companies are investing in supply chain collaboration. This move will make coordinating responses to future disruptions easier, increase efficiency, and eliminate redundancies.
Is it time for you to unite your supply chain partners in the pursuit of growth? If it is, schedule a demo to see how you can build better deals for everyone in the supply chain.