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The ABC of Streamlining the SMB Supply Chain

People who work in small to medium-sized technology companies wear a lot of hats. Who has time to figure out how to “streamline” their supply chain? What does that really mean in practice?

By using very simple (and often free) solutions, you can reduce costs, save yourself time, and make yourself look like a star. Here are three simple tips for streamlining your SMB supply chain:

  • Automated inbound visibility
    The arrival of a bunch of packages or pallets at your dock can be a hassle. Will you have enough staff to deal with the unknown influx of inbound shipments? Did you receive everything that the supplier promised? Did that snowstorm in Denver hold up your shipment? Will you be able to turn the product around to your end-customer in time?

    Recommendation: Set up a visibility solution through your carrier, your third-party software supplier, or your logistics provider that shows when and/or if the shipment was sent. Proactive email notifications will let you know in advance if a shipment is delayed, so you can notify your customers in advance. Finally, use this visibility solution to determine when the shipment will arrive and plan staff accordingly.

  • Brisk order processing
    Let's say your firm processes 20 shipments a day. If you could save one minute of time per shipment, that would save you a whopping 84 hours in a year. That's more than two weeks worth of time saved.

    Recommendation: Use a shipping system with an address book and integration capabilities, thereby reducing key strokes and manual entry. Saving one minute per shipment is entirely feasible since you don't have to continually type in addresses. In fact, one minute per shipment is on the low-end of what I've seen at UPS customer sites.

    In addition, for an even more streamlined order processing system, work with your carrier or a third-party software provider to link up your order entry database with their shipping systems. Imagine the satisfaction you'll enjoy when labels automatically print once an order is entered into your order entry system.

  • Customer-enabled tracking
    Every supply chain needs glasses. Giving your customers visibility into their orders on the outbound side of the supply chain is as important as your need for visibility on the inbound side. This outbound visibility helps in two major ways. It lets your customer plan for receiving the shipment(s) and helps you avoid WISMO (where is my order) calls.

    Recommendation: Use a shipping system (your carrier’s or a third-party software provider’s) to set up proactive transportation notifications for your customers. First, capture your customer's email address during the sale. Then, during the outbound shipping process, set up outbound shipment notifications to the customer-supplied email address. Your customers will appreciate the advance notifications.

By using these three simple (and often free) solutions within your supply chain, you can look like a hero and save your SMB time and money. It’s as easy as ABC. I'd like to hear whether your firm uses these solutions, or has any other tips that are making your supply chain run like a “well-oiled machine.”

11 comments on “The ABC of Streamlining the SMB Supply Chain

  1. Jennifer Baljko
    October 22, 2010

    Hi Mike,
    Thanks for sharing these practical tips. I have a few follow-up questions for you.

    It seems “automation” today still implies some sort of email chain in which one person receives the notification and then forwards it along to the internal shipping/receiving team and/or the customer. How easy is it set up the system to notify multiple people at the same time so everyone who needs the shipping or receiving information gets it simultaneously? Are there any drawbacks in having that information disseminated across multiple individuals or groups? I imagine a considerable amount of time would be saved throughout the supply chain if everyone got the information at the same time.

    And, how do you envision these inbound and outbound visibility issues being addressed by Web 2.0 connectivity tools or social networking platforms? These kinds of tools are becoming more prevalent, and people are getting comfortable interacting this way. Some of these shipping alerts may lend themselves to a Web 2.0 environment.

    Jenn

  2. DataCrunch
    October 22, 2010

    Hi Jennifer, I am not speaking for Mike, but incorporating a distribution list or adding multiple recipients to an email notification should be relatively simple.  The real question I think you are posing is that email notification, although perhaps automated by the sending party, still requires human intervention at the receiving side or somewhere in the chain.  The more automated systematic approach would be to implement some sort of event management system, where these sort of notifications would then trigger of series of events which would then be reacted to automatically by the system via a rules engine and making the proper adjustments and decisions without any human intervention.  Incorporating Web 2.0 or social media into this would be quite compelling.

  3. Jennifer Baljko
    October 22, 2010

    Right, Dave. That's exactly what I was wondering – how do we shift from a system that stills need human interventation to a more truly automated event-notification mechanism. That's really what most companies could use.

    Jenn

  4. DataCrunch
    October 22, 2010

    Ahhh!  This is easier said than done.  Jennifer, I agree that this is what most companies need, but there are issues, and we touched upon this somewhat on your “Co-Creation and Collaboration” post.  This may not pertain as much to an SMB company, but if you look at a typical large (or even medium sized) corporation with global operations (and in many cases, just domestic operations), the number of potential systems that are being maintained may be numerous.  Some of these systems may be modern, while some of them may be a bit dated.  Also, certain functionality may be specific to each system.  Manufacturing, Distribution, Order Entry, Finance, etc. may all be on different systems.  The problem is that they are on different systems, in which in many cases a “best of breed” solution is the best approach, but some of the systems are in fact dated and cannot be easily modified or updated without a major upgrade taking place.  This is why many companies can only hope for a visibility layer sitting on top of all or some of these systems with limited automation.  The technology exists, but are companies willing to take the plunge for full automation? 

  5. Mike
    October 29, 2010

    Dave, you hit it right on the head: “The technology exists, but are companies willing to take the plunge for full automation?”

    Fortunately, it's getting easier!  Transportation and logistics providers are increasingly offering slicker technology tools to tap into the logistics data stream. 

    Certainly today, it's standard fare to enable proactive email notifications to multiple recipients, if desired.  Also, there are often robust data streams (eg XML) available for the ultimate in notification customization.  Finally, more software providers are offering out-of-the-box integration.

    Mike

  6. Mike
    October 29, 2010

    Also, one other thing:  the web 2.0 intersection with logistics is a fascinating question (Web 2.0 == dynamic and shareable content and social networking, as defined by Wikipedia).

    Likely, integration with Twitter and/or Facebook is going to be on the horizon for a lot of companies as these social media streams become more and more ubiquitous.  Wouldn't it be cool to get a Twitter direct message on your blackberry telling you your supplier just shipped your pallet, vs. merely an email!  🙂  Obviously, the desired channel for visibility info will vary across people/firms:  some want email, some want a Twitter DM, some want carrier pigeon.

    My guess is that we'll see more of a demand for Web 2.0 supply chain visibility after High Tech firms get past some of the basic struggles (visibility from supplier to end-customer).  Sometimes (esp. for the SMB) it seems companies are focused on growing sales, cutting costs, and innovating, vs. taking the time to leverage more sophisticated supply chain technologies. 

    What they often don't realize is that there are options for technologies and it actually helps improve the bottom line and it's worth the time (even for the SMB)….   

    Mike

  7. Ariella
    October 29, 2010

    Can I get the carrier pigeon? Perhaps snail mail would fall into that category.  Personally, I don't care about the coolness factor and check my email much more frequently than Twitter, so I actually would prefer an email notice to a Tweet.  But the world at large probably would prefer a text, as that is considered universally cool –even for the teens who don't tend to follow Twitter.

  8. itguyphil
    October 30, 2010

    Ariella,

    I agree with that. The only caveat with texts is that there isn't as much accounting as there is with email. I can easily delete a text from my phone with no simple way to recover it in the case of an emergency or compliance.

    This all goes out the window is youhave a Blackberry of coourse (but I can't stand those things…).

  9. Ariella
    October 30, 2010

    Maybe you can also get a carrier pigeon, pocharles, then you can keep the slip of paper for a written record. What do you have against blackberries?  I don't use one myself, but I know it is required for many IT people.

  10. itguyphil
    October 30, 2010

    Having had worked with them for years now, there are so many little things that pop up when it comes to using and/or administering them. I have mostly done admin tasks with them. I know many IT guys love them but that's because alot of them do not have to do any real setup work (they just get it & use it). Of all of the smartphones I've been fored to work with, the BB's are the most annoying.

    The only thing I cannot ignore credit is that their support is awesome and their Knowledge base is better than most.

  11. Ariella
    November 1, 2010

    I see.  From what I understand, BBs do require specialized knowledge, so it can be frustrating for IT people to have to administer them.  Well at least you have good support available to you.   

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