WHAT IS THE PURPOSE OF A SUPPLY CHAIN?
Advisory Board Member GMU Center for Retail Transformation
The majority of my career has been focused on Supply Chain Management, Transportation, Logistics, Last Mile Delivery and solving business problems with Robotics.I have designed and implemented supply chain projects globally, and I have managed supply chain and logistics organizations for some of the largest companies in the world.
Along the way, I earned three Master's degrees including an MBA, Logistics and Industrial Management, a combined degree from Baker College and Penn State;and a Master's of Supply Chain Management from Penn State University. The Supply Chain Program at Penn State is consistently ranked as the leading or one of the leading, Supply Chain Masters program in the world. I'm grateful to be a graduate of the program.
What I find fascinating is that the press and platforms like LinkedIn, only write articles about the importance of supply chain management when some type of disruption occurs reminding everyone how vulnerable they are. Case in the point, the disruptions that have occurred globally due to the pandemic.
I continue to read articles where the writer erroneously states that the pandemic is a 'Black Swan' event that triggered a massive global disruption in manufacturing and the supply chain. False. Pandemics have existed on earth for thousands of years. The Black Swan event that caused the current disruptions throughout the supply chain wasn't the pandemic, it was the foolish decision made by governments to intentionally shut down their economies - this has never happened before - ever. The process of restarting an economy and meeting pent up demand for every imaginable product is no easy task.
The supply chain disruptions we are currently experiencing has shifted the conversation of what a supply chain is all about. Phrases like, "ensure continuity of supply" or "balance supply with demand" appear frequently in publications and articles.
Let me be clear. The purpose of a supply chain isn't to ensure continuity of supply, balance supply with demand, reduce working capital, and so on. Yes, the things that I listed are important but they're the result of an optimized supply chain, they aren't the reason why a supply chain exists.
If you're new to the topic of supply chain management, or even if you have years of experience, it is vital to remember that the legitimate purpose of a supply chain is to ENABLE GROWTH.
Far too many companies have executives in charge of running their supply chains who view the supply chain as something to be managed. This is FALSE. Supply chains should not be viewed as being transactional, supply chains should ALWAYS be viewed as being FLUID and STRATEGIC. You don't manage strategy, you LEVERAGE strategy to affect a desired outcome.
