The buzzword of the 21st century – Globalisation.
It’s hard to ignore the impact it has on the way we do business. In the world of supply chain management, it’s like a hurricane that’s turned everything upside down – sometimes for the better, sometimes for the worse. Unlike a real natural disaster, it’s not all bad news. In fact, it’s created a whole new set of opportunities for businesses that are willing to adapt.
If you think of globalisation as a giant jigsaw puzzle, then supply chain management is the glue that holds all the pieces together. From sourcing raw materials to delivering finished products, every step of the way requires careful coordination and management. It’s like a symphony, with each instrument playing its own part in creating a beautiful and harmonious whole.
But globalisation has added a new layer of complexity to the symphony. It’s like adding a new instrument to the mix, one that plays a different tune and requires a new set of skills to master. Businesses that can learn to play this new instrument and incorporate it into their symphony will be the ones that succeed in the global marketplace.
So, how can you adapt to this new reality? It’s like learning a new language. If you think of globalisation as a new language, then supply chain management is the Rosetta Stone that helps businesses decipher it. And just like any language, it takes time and practice to become fluent.
That’s where technology comes in. From artificial intelligence to the blockchain, there are a host of tools available to help you navigate the complexities of the global supply chain. It’s like having a pocket translator that can help you communicate with suppliers, distributors, and customers worldwide.
What is Globalisation?
Globalisation connects people and economies around the world. It’s the phenomenon that enables countries to trade goods and services, share ideas and cultures, and let you collaborate on a global scale. If you think of globalisation as a language, then it’s one that’s constantly evolving and adapting to the needs of an interconnected world. It enables businesses to expand their reach, individuals to connect with others from different backgrounds, and economies to grow and thrive.
So whether you’re a business owner looking to expand your market, or a curious traveller exploring different cultures, globalisation is the language that allows you to communicate and connect with the world.
So, how has globalisation affected supply chain management? With goods and services travelling across borders, there are more factors to consider, from customs regulations to currency exchange rates. This increased complexity can lead to higher costs and greater risk, which is why efficient supply chain management is more important than ever.
Let’s describe some of the advantages and opportunities that are presented to us by globalisation and supply chain management:
Access to New Waters
You want to expand your business in another country but you don’t have much knowledge about it as you’re not aware of its local market. For that, you have to partner with a local distributor in that region to help them reach customers more effectively. This can be especially beneficial if you are looking to expand into emerging markets, where local knowledge and expertise can be critical to success.
Technology and Information Sharing
Imagine you are using a cloud-based supply chain management system that allows you to track inventory, monitor production processes, and manage logistics in real time. These systems can help you identify and address supply chain issues before they become major problems.
Also, globalisation has led to increased information sharing between businesses and supply partners. So it enables your business to better understand your supply chain partners and work collaboratively to improve efficiency and reduce costs.
Greater Efficiency and Productivity
Imagine you are selling products and are responsible for ensuring that they are delivered on time and in good condition. By utilising real-time data, you can identify and address supply chain issues more quickly, resulting in reduced downtime and improved overall performance. Additionally, by collaborating with suppliers and sharing best practices you can gain valuable insights and knowledge that can help you improve production processes and reduce waste.
For example, you might learn about new methods for optimising your transportation routes, or find a more sustainable way to package and deliver your products. This can help your company stand out in the global marketplace.
Improved Customer Service
In today’s market, there are higher customer expectations for quick and dependable delivery of products and services. To meet these expectations and improve customer service, you should adopt effective supply chain management strategies.
For example, by using predictive analytics and supply chain visibility tools, you can analyse customer demand and accurately forecast future requirements. This ensures that the right quantity of products is delivered to the right place at the right time, avoiding stock shortages or overstocking. As a result, you can satisfy your customers’ demands and gain a competitive edge in the market.
Inventory Management and Risk Mitigation
Let’s say you have to import raw materials from different countries to manufacture a product. You would need to manage the inventory of raw materials efficiently to ensure you have enough stock to meet production demands, but not so much that you are tying up capital in excess inventory.
To mitigate the risks associated with global supply chains, you could diversify your suppliers across multiple countries and establish contingency plans in case one supplier is unable to meet your needs. You could also implement a tracking system to monitor inventory and shipments and use data analytics to predict potential disruptions in the supply chain.
You can maintain a steady flow of raw materials and avoid stockouts or excess inventory. This leads to cost savings, increased efficiency, and improved customer satisfaction.
The impact of globalisation on supply chain management is significant, but businesses that take a strategic approach can thrive in this globalised world. You can ultimately provide better products and services to your customers worldwide.
Want to know more about how we can help you with the globalisation of your supply chain?
Connect with BlueSky today.