SCM Best Practice: Improve supply chain visibility to reduce working capital

Reducing working capital is one of the strongest challenges all organizations face these days and moreso aftr recent ecomnomic downturn when it was again proved that CASH is KING. One of the very effective ways to reduce your deployed working capital, is by increasing your supply chain visibility and leveraging the same visibility to lean your processes by removing bottlenecks or to release excess/buffer inventory that holds up the working capital. The big questions now, is how to increase the supply chain visibility and what are best in class organizations doing to achieve this? Another one is, how to make sure that the way we want to increase our supply chain visibility (SCV), gels with the overall organizational strategy? 

Well, the answer to the first question is that it is upto us to evaluate our options and decide but before that, it is recommended to have a list of options in the area of maximum pain so that a proper presearch can be done. The major methods that the best in class organizations take to improve their supply chain visibility are highlighted in the attached picture here:

Not all of them are required and it is highly likely that you already have one or the other method or system in place but that doesn't mean that you have complete supply chain visibility and you have all the information available to go for the transformational change in the organizational processes. It is recommended to check of above systems/methods and evalaute whether your comapny will need this or not and if it is deployed, what will be the ROI on this (also in terms of how fast the working capital can be reduced and how much).

The above picture does not provide all the options but this list is based on the major challenges that organizations face. In case, your organization face a different challenge, let me know and I will glad to help to identify the right method for you to improve supply chain visibility.

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