Each company is different, and the same is applicable to each sector and each region. However, this does not prevent logistics companies from giving very important examples that can be applied in any type of company, beyond the part dedicated to the supply chain and merchandise shipments.
What are these lessons that we should learn -or “steal”- from logistics companies? How can we apply the lessons of the supply chain to other areas of the business world?
Steal these five ideas from logistics companies
1.- Optimization and fluidity in processes
A supply chain is a living thing that needs to move as smoothly as possible. This work includes having the parts and tasks that go from obtaining raw materials to placing the product in the hands of the final customer. And your success depends on achieving this fluency.
Is that your company? Outside of manufacturing the products, could you say that in your company the processes are well-oiled? Lack of coordination and duplication of tasks, problems when sharing information -or ensuring that the information is the same across all departments-, knowledge of the tasks and objectives of each person and each department ( in addition to the ability to work between different departments, preventing them from being watertight compartments), etc. All these points can be the source of conflicts. Making them fluid instead of trouble spots will make a huge difference.
2.- Sustainable growth
All companies want to grow; However, doing it in any way can cause us more dislikes than joys. Logistics companies are especially concerned with sustainable growth. Being companies so focused on processes, it is essential for us to ensure that we are going to be able to assume the growth in volume, which can generate more needs for personnel, machinery and facilities.
For this reason, being aware of its importance, logistics companies are also concerned about the sustainable growth of our clients. If your company grows faster than it should, it is possible that quality suffers and not only from the logistical point of view -such as stock-outs-. Processes that were efficient before can stop being so due to bottlenecks and inefficiencies, perhaps we are not having time to amortize the investments necessary for this growth before having to replace them with new ones, or our customer service department is overwhelmed.
Growing is desirable, but doing it sustainably is non-negotiable.
3.- Improve collaboration
Good collaboration is essential in logistics companies, both inside and outside the company itself. We have already mentioned the need to be able to work in harmony with the rest of the departments, but we can also take that perspective outside the walls of our company.
Logistics operators need to weave an efficient collaboration with two fundamental groups: customers and collaborators/suppliers. Putting yourself on the same side of the client is essential to overcome the traditional division that opposes the interests of the client with those of the company. This is especially the case in matters such as price negotiation, but it is also applicable when it comes to understanding the real needs of customers and their pain points. Do we collaborate with them or do we just have them sign us a rate for our standard services?
Regarding collaborators and suppliers, logistics companies often work systematically or punctually with other companies. This way they can optimize routes by increasing the volume, find reinforcements in tasks or areas that pose difficulties, etc. Can you do something similar in your company? Do you have “weak” points that perhaps you can better solve by outsourcing, either one-off or long-term? Are you even capable of collaborating for your competition when you see the possibility of achieving a common benefit?
4.- Have a global vision
Logistics companies need to see the supply chain as a whole that is beyond the sum of its parts. Only then can they understand how a failure, defect or delay at one point can end up resulting in much bigger problems at the other end of the chain. Principles such as the bullwhip effect, in which the negative effects multiply as time goes by, are what invite us to have this more general vision of the entire process and of our business.
Companies must also replicate this mentality in their day to day. Being able to understand what the ultimate goal of the company is, the value proposition they offer to the market in which they operate and what their role is in making it a reality.
5.- Continuous improvement
Logistics companies can hold their heads high when it comes to continuous improvement. Six Sigma, Lean, Just in Time processes and other modalities have a great relationship with manufacturing and the supply chain. In this way, the idea of constantly beating one’s own records and the search for how we can improve our performance have become recognizable constants in logistics work.
This desire to measure and improve every day is something that must be achieved to make the leap from the warehouse and the assembly line to the rest of the company’s activities. Many of the tasks carried out in companies can (and should) be measured through performance indicators, monitoring them and proposing corrective plans for their improvement. How long does it take to resolve an incident? And in providing a budget? Do you know the level of satisfaction of your customers? What concrete steps have you taken to improve it, and how have you made sure to see if they have worked?
Logistics and supply chain are ultimately just attempts to do things in a more logical, orderly, fluid, and efficient way. Therefore, its fundamental principles and goals can be applied to other areas of companies. Optimization, fluidity, continuous improvement, sustainability and collaboration are terms that a company should not limit to its supply chain.
Do not hesitate to learn these commandments from logistics companies and introduce them into your own processes. Sometimes there’s nothing wrong with stealing.
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