Commentary

OPINION Right on the money: How accuracy improves supply chain operations

Ivanti

Rob DeStefano, senior product marketing manager, industries, at Ivanti Supply Chain, talks about the key importance of supply chain accuracy.

The supply chain is the backbone of business operations although it is vulnerable to myriad challenges. At present, we are witnessing a growing demand for accuracy within the industry in a quest to achieve greater cost control, maximise productivity and improve customer service.

Supply and demand

A recent Accenture report cites that around 70% of industry professionals surveyed anticipate that the supply chain will be a key driver to delivering better customer service before the end of 2020. One essential step to reaching the utopia of good customer service is inventory management. This equips professionals with the tools to track resources, ensure that they are appropriately stocked and thus, meet customer demand.

At present, with B2B and B2C eCommerce booming, supply chain companies are contending with the fine balance of matching supply with demand. Businesses carrying too much inventory place pressure on their already limited and costly warehouse capacity, or face lost revenue through perishable or unsaleable goods. On the flip side, those with too little stock face the frustrating and unnecessary risk of losing customers due to unavailable items.

Manual inventory management can also add to poor customer service through human error. This time-consuming and complicated process can result in over or underselling. In instances where customers purchase out of stock items, the company’s brand reputation is affected and the customer service team may need to offer discounts or promotions as reconciliation. This can severely squeeze profit margins.

Accessing inventory in real-time is essential to preventing such issues and maintaining customer satisfaction. Employing an automated system, such as order management systems (OMS), enables businesses to collate information faster and make smarter decisions for the future. In addition to sharing data, unified solutions like this allow supply chain companies to accurately track and monitor goods on their journey to the customer. Although stock levels fluctuate, this data equips companies with the tools to maximise storage space, improve stock use and gauge supply and demand. From a human resource perspective, it unshackles workers from lengthy manual input, allowing them to redeploy their skills elsewhere in the production cycle where they will have the biggest impact on the business.

Picks, products and profit

Another factor that affects customer service and profit is the picking process. With thousands of picks performed every hour, accuracy is essential to eliminate the wrong products being delivered and negatively influencing customers’ experience. In equipping workers with Enterprise Resource Planning (ERP) systems, companies can mitigate these issues with barcode scanners, digital data entry and utilising voice-directed technology.

Voice-directed systems enable the warehouse team to focus on the picking process without being slowed by paperwork. With both hands free, picking accuracy can be greatly improved and the speed at which picks are completed is increased, therefore improving customer service. Traditionally, picks aren’t verified so if the wrong item is selected, it wouldn’t be highlighted until after the customer receives it. This often leads to product returns or correct items being dispatched with free next day delivery as compensation, eroding profit margins. In fact, Dorman Products, a supplier of automotive replacement parts, reduced its picking inaccuracy by 86% after moving to a voice-directed picking system.

Performance metrics, such as Perfect Order Rates, are another tool that can help supply chain companies to improve accuracy. This solution details how many orders are completed without incident, allowing companies to evaluate the effectiveness of their supply fulfilment at a transactional level. Using this data, businesses can pinpoint areas of improvement, helping them to achieve perfect accuracy, boost operational efficiencies and reduce costs.

Automate to mitigate

With the advent of automation, AI and data analytics, supply chain processes are now more streamlined than ever. Automated supply chain solutions are designed to seamlessly integrate into existing workflows with minimal disruption, allowing businesses to reap the benefits within little time. In fact, these solutions are engineered to adapt to the changing landscape of business, proving a method to deal with current and future issues.

There are a number of software providers offering automation at a competitive price point. This not only makes the solution affordable now, but also pays off in the long-run. When it comes to customer service, automation allows companies to meet customers’ evolving demands, accelerate delivery times and provide excellent customer service.

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