Optimizing Your Supply Chain - according to officials at Ernst and Young, the quality of a company's supply chain management will soon be driving force to its success - Brief Article

Bobbin, May, 2000

Most likely, you have been engaged in supply chain management. the succession of interrelated activities that extends from your suppliers to your customers. But is your company's supply chain prepared to go up against the competition? And in what areas must you concentrate to fully optimize the benefits of an integrated supply chain?

A company typically has several supply chains -- each defined by the nature of its products, services or marketing channels -- and all supply chains have four key flows: 1) materials, products and services; 2) information; 3) cash; and 4) work processes and alliances. Now emerging within these established parameters. according to Ernst & Young (E&Y), is the need to skillfully apply a company's operational resources to achieve a competitive outcome.

As E&Y's Mark Manoff notes, at one time companies gained advantages on the strength of unique products, well-respected brands and a strong geographical presence. Today, a new and more sustainable source of competitive advantage has emerged -- operational excellence that drives a business' performance and differentiates a company's supply chains from those of its competitors. In the future, he says, competition will be across supply chains rather than between individual companies. As such, supply chain excellence will result in economic advantages, including winning and retaining new customers and improving shareholder value.