Maintaining an efficient supply chain may keep costs down, but does it always make the customer happy? This article explains why effectiveness and responsiveness can be just as important.
Supply chain leaders are intimately familiar with the problem—should they prioritize efficiency in their supply chains, or is delivering effective, responsive solutions to their customers more important?
In competitive markets, cutting costs wherever possible is essential to survival. However, sacrificing the customer experience to save money, time, and effort is not always the best strategy. In fact, efficiency often directly contradicts the customer’s goals.
In the end, supply chain managers need to assess their customers’ needs to deliver on their promises, prioritizing efficiency or effectiveness to meet expectations.
What is an Efficient Supply Chain?
Supply chain efficiency is the measurement of how well a company uses its available resources—whether financial, human, technological, etc.—to accomplish its goals. By maximizing efficiency, a company can obtain what it needs while reducing costs, which allows the company to extract the most value from its processes.
How Supply Chain Efficiency Can Reduce Effectiveness and Responsiveness
An efficient supply chain does not always meet customer demands. When a company prioritizes supply chain efficiency over effectiveness and responsiveness, quality, timeliness, and flexibility often suffer. While efficiency focuses on accomplishing goals with as little waste as possible, effectiveness focuses on accomplishing them to the standards of the customer.
Both efficiency and effectiveness are critical pieces of the supply chain puzzle. In the end, supply chain leaders need to strike a balance between these standards to reduce costs and deliver quality to keep their business partners satisfied.
4 Ways to Find a Balance That Fits Your Needs
1. Invest in Automation
Automation allows organizations to blend efficiency with effectiveness by increasing the speed and efficiency with which each component within the supply chain completes repetitive tasks. Whether you need solutions in manufacturing, logistics, packaging, or order processing, automating your processes can help.
2. Outsource
In some scenarios, it may be not only less expensive but more effective to outsource part of your supply chain needs. Finding partners who have better capability to deliver quality and efficiency can benefit everyone involved.
3. Talk to Your Customers
Staying in communication with your customers can help you meet and exceed their expectations, which can help you retain their business. Unless you know what your client wants and what they value, you will not be able to find a balance between efficiency and effectiveness that addresses their needs.
4. Use Data to Evaluate Your Internal Processes
An effective and efficient supply chain is critical of itself, constantly looking for where it can improve performance and reduce waste. To determine where your efficiency is lacking—and where you might be able to sacrifice efficiency for effectiveness—you need to collect and analyze data about your processes. Make adjustments accordingly.
Take Your Efficient Supply Chain to the Next Level
At Teknik Trading, we take pride in our ability to provide our partners with a balanced blend of supply chain efficiency and effectiveness. Our cost-effective, responsive solutions are tailored to meet your needs and exceed your expectations.
Let us help you manage your supply chain efficiently and effectively. To learn about our stress-free solutions, call +1 (305) 592-1512.