supply chain diagram

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Supply chain strategy for any kind of company, both existing and evolving, is a first and foremost factor in the rapidly moving competitive business environment. Almost every highly growing manufacturing company has a certain supply chain strategy and structural design for analyzing demand, supply and profit management. However, to sustain and establish a business company in the highly competitive business environment, the management must consider the following unavoidable elements before planning an effective supply chain strategy.


What is the leverage in supply chain strategy? Well, in planning supply chain strategy ‘leverage’ is an important element that every business company, despite its revenue and size, should adopt to plan a smart and efficient supply chain strategy. The term leverage includes the cost reduction and benefit managing plan. However, the more power the leverage, the more possibility of growth of the company. I have found in a market research that, some highly growing Business Company adopts a smart leveraging plan that has a great impact on their rapid growth and improved profitability.

Product Development

What should the main products of a manufacturing company? And which type of products the company will produce for their targeted customers?

The Senior Management leader of a company should consider the above mentioned two important questions in order to design an effective supply chain management strategy. Developing product cycles, initiate new versions of the current products in the market places, and develop the quality and designs of the products are the main factors of product development element for planning an efficient supply chain strategy for the today’s competitive business environment. Therefore a smart product development plan firms the overall supply chain strategy.

Targeted Customers

Customers factor in the most important element of designing an effective and successful strategy for supply chain management. The think tanks of the company must consider this ever important factor, customers, of supply chain strategy. The management has to identify the targeted customers of the manufactured products and services of the company. The supply chain strategy without considering the customers must be a bull story in the business history.

Manufacturing Strategy

Manufacturing decisions, in supply chain strategy, define the manufacturing plan and probable technology that can be used in production. The management has to plan the manufacturing infrastructure based on their sales estimation and highest possible business forecasts. The manufacturing strategy includes some other factors like existing technology for production, possible upgradable technology and other facilities. However, designing a better supply chain strategy should consider this element to make a useful plan for the highly competitive business environment.

Suppliers and Raw Materials

In a strategic supply chain management, raw materials and the suppliers of the raw materials are the two important factors. A management related study shows that, the highly growing company carefully considers the raw materials and the sources of materials to plan an efficient and competitive market friendly supply chain strategy. The management team has to find the best and affordable supply sources that offer the maximum discount with other logistic support. Thus, this policy plays an important role in strategic decision making in the competitive business environments. However, the main aim of this strategic element is minimizing the material expenses.

Logistics Function Planning

Logistics functions are one of the unavoidable elements of successful supply chain strategy for any kind of manufacturing business company. The business geeks consider this element as the key to the success of a supply chain strategy for a highly competitive business environment. A better logistic function plan has a great impact on the performances of the strategic supply chain management. Logistic strategy should include the overall logistic support and suppliers of the logistic support including possible third party.

Efficient Business Communication

There are no other alternatives of efficient business communication in supply chain strategy. An ever active communication within the company, suppliers of external resources, essential service providers, materials suppliers and outer world is a significant element of modern supply chain strategy. Every existing and evolving company must ensure an efficient and versatile business communication that can play a vital role in the growth of the company and its business. Business communication specialists think, an effective communication within the all business components has a significant contribution in designing a great supply chain strategy.

Innovation and Technology

Latest innovation and technological support can play a powerful role in strengthening and developing a proactive supply chain strategy. In the technological era, there are a lot of rapidly growing companies have implemented different latest innovation and software like Advanced Distribution Software, SCM software, ERP etc. to make a strong supply chain strategy. The different business software helps to analyze the market trends and regular market behavior that allows the company to estimate sales, demand and overall market forecast of a company. The latest technology also offers different risk management tools using that a company can analyze the probable upcoming business risks.

Author bio:
This supply chain strategic planning article is written by Tom Huston who has been an analyst of different business software like Advanced Manufacturing Software, ERP, and MIS. In this article he describes the most important and unavoidable elements of planning an effective supply chain strategy. The article will help you to design an efficient and proactive supply chain strategy for your evolving business company in the competitive environment.