How to Improve Supply Chain Relationships and Mitigate Risks

This document discusses the importance of managing effective relationships with suppliers in supply chain management. It outlines strategies and steps to improve supply chain relationships, including encouraging good conduct, effective communication, and strong agreements. It also explores ways to mitigate supply chain risks and reduce costs, such as diversifying suppliers and using technology. The document concludes with the importance of timely payments and the benefits of outsourcing.

Supply Chain
Management

Table of Contents

INTRODUCTION
Procurement Council defines procurement management as “SCM incorporates all efforts
engaged in the production and distribution of the final product or service, from the evening
plier supplier to customer service. Procurement management includes management and demand
management, acquisition of materials and parts, production and integration, storage and tracking
of goods, order delivery and order management, distribution to all channels, and delivery to
customer. Also supply chain management in the essential business function that help a business
to make the flow of inventory in smooth way. DSV is a global provider of transportation and
services solutions in UK. Provides and manages supplychain solutions with thousands of
companies every day, from the youngest conducting business with large businesses around the
world. Therefore the following report outiline the effective supply chain management and how
they achieve the goals of the conceived, supported and developed within the DSV roads in a way
that they can improve their supply chain management. Also, report outline the various
mitigations solutions for the supply chain risks along with the ways to cut down various
unnecessary business expenses. At the end, report speaks about the way by which company can
improve supply chain sustainabily.
MAINBODY
in what ways can supply chain relationships be improved
Nowadays, business owners are facing an increasepressure on customer needs in
product development, quality improvement and demand responsiveness and also entrepreneurs to
reduce production costs, short lead time, and low inventory to ensure and improve profitability.
Managers realize that delivering products to customers faster than competitive will improve the
company's competitive position. In order to stay competitive, companies should seek out news
stories on important supply chain management issues.
Organizations that are successful in supply chain management understand the importance of
managing effective relationships with their suppliers. These organizations have the ability to
build trust and confidence in their providers which leads to the sharing of information and the
identification of development opportunities. Provider relationship management is a difficult task;
including revision, advanced testing and follow-up planning in order to further develop long-
term asset relationships and strategies. There are various models of Supplier Relationship
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Management. These types require that both parties have the following characteristics: mutual
respect, understanding of the benefits of the relationship, trust, fairness and honesty. Following
are the business strategies of DSV roads in order to improve the supply chain relationship with
their supplier-
Encourage good conduct
Companies should consider you to ensure that the supplier behaves in a manner that is conducive
to building productive relationships. It is the responsibility of the supplier and the consumer to
promote good behavior in order to ensure a win-win situation. For example: opportunistic jobs,
slow delivery may indicate that the supplier is not adequately invested in the relationship.
Find out more from strategy providers
It is important to understand that strategy providers are not the same as regular retailers. They
cannot be managed in bulk in e-auction systems or in accordance with the requirements of the
discounted garment. This relationship requires time and trust. As such, a significant consumer
investment in the relationship should be repaid with a variety of supplier benefits. For example:
with regard to new product innovations, risk reduction projects and reconstructed engineering
programs can be the result of a successful supplier relationship.
Effective Communication
Keeping the channels open and strong will help keep you and your providers on the same page. It
needs to be clear in working with each other to build trust and understanding in the partnership.
In addition, it is also helpful to understand their language and culture to avoid any damage to
communication.
Strong Agreement
One of the most important steps in managing supplier relationships is always to make sure that
you and your suppliers agree on a clear agreement when defining terms and obligations. This
should be done before agreeing to a broker-dealer agreement. Such an action will remove any
conflict or disagreement if there is a problem.
Supplier Relationship Management System
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As with any other aspect of your business, strategies are needed in a structured relationship with
your suppliers. The important thing is to treat them well and not to abuse their power as a
consumer. It is important to determine supportive and supportive relationship management
management principles within a set period of time, a list of tasks and a process to achieve goals
and establish roles.
Performance Management
An effective provider relationship management system should incorporate defined performance
management processes. For example: participation in a high level of management is key to the
continued success of the SRM program. Authorities can only meet quarterly to discuss strategies
while lower levels are involved in strategic planning and can contact suppliers daily or weekly as
appropriate to manage the business. Therefore, acquiring inputs from a different level of
management will ensure that the SRM system will work effectively on a daily basis while
continuing to develop and address the long-term goals of both parties.
New Training
When establishing an SRM system, training is needed to educate the organization about its
benefits and its role in improving business performance. All involved must be trained in how to
use the tools to ensure the successful implementation of the plan.
Therefore, a new and more inclusive training program will be of great help. Example: At
Procurement Academy, staff are trained according to their role in the modern e-learning toolkit
as state-of-the-art training. Such training allows them to face real work situations that prepare
them for any future challenges.
Point to Any Roadblocks
It is important to discuss with your suppliers any potential obstacles. For example:
communication issues between your sales managers and your supplier's sales department,
incompatible software, relationships with new managers or employees etc. This is an important
step you should take as anything that hinders your supplier relationship has the potential to
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reduce or stop the product. Therefore, you want to avoid this as much as possible by facing any
roadblocks ahead.
Note that timely payments are important
Paying your providers on time will ensure that you do not lose them. In this way, you will prove
that you are a loyal customer and that it is easy to work with them. In the event that you are
unable to pay on the agreed date, notify the provider as soon as possible on the due date. Just
remember that providers will appreciate timely payments like you as timely actions on their part.
Technology
There is no doubt that technology can simplify the entire process of relationship management
with suppliers. Having an active system will make it easier to view your providers and analyze
all the risk factors. Therefore, using SRM technology gives you a complete and unparalleled
visibility for your suppliers, giving you a detailed picture of what affects your purchase and
making it easier to reduce risk.
How does the organisation (managers) mitigate supply chain risk and reduce supply chain costs
Supply chain risks comes from many activities, data loss, breaching, natural disasters,
bankruptcy of supplier, illegal acts and areas. (Company) should take a critical look to their
business and find out areas with risk exposures. And evaluate potential supply chain interruption
scenerios. Covering every scenario in (company) is not possible, so prioritize potential risks by
the myth they could actually take place. Then take a estimate of financial and impact on brand of
every single event. Conduct financial due diligence to ensure long-term supplier viability to
make sure supplier doesn’t impact (company’s) reputation badly.
Supplier’s Risks
Never ever rely on a single source for materials or products. It’s desirable to source goods
from low cost locations, but your supply chain will become vulnerable if goods can’t be
delivered in a timely manner. Secondary reliable suppliers should be established to minimize the
risk. Be aware of risks your suppliers could face, that can include regulations compliance, risk of
country, conditions like economic and political or anything that may impact their ability to serve
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them below are the ways by which supply chain manager can minimise the risk of the supply
chain management such as -.
 Work with the suppliers, data management centers, transportation carriers and
continuiting plans of business that align with yours should have disaster recovery surety.
Involving them in risk management plannings reinforces their importance and dedication
as a partner and their role is elevated in risk mitigation.
 Share information regarding increased sales projections, and partners should be included
in product design changes. This will help suppliers to have right product available
whenever needed. Similarly , if forecasts of sales drops , let partners know that. They will
appreciate the heads up gesture and it will strengthen your relationship.
Throughout the supply chain,
key operational metrics and
status
reports such as inventory,
demand, forecasts, production
and
shipment plans, work in
progress, yields, capacities,
backlogs, etc.,
should be accessible easily by
key members of the supply
chain. Such
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information should be accurate
and timely, rendering it useful
for all
parties for planning and re-
planning purposes. Thus, it is
important
that the key indicators are
tightly managed and that any
updates are
made as timely as possible. The
accuracy of the data should be
a
source of confidence to the
parties using the dat
Throughout the supply chain,
key operational metrics and
status
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reports such as inventory,
demand, forecasts, production
and
shipment plans, work in
progress, yields, capacities,
backlogs, etc.,
should be accessible easily by
key members of the supply
chain. Such
information should be accurate
and timely, rendering it useful
for all
parties for planning and re-
planning purposes. Thus, it is
important
that the key indicators are
tightly managed and that any
updates are
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made as timely as possible. The
accuracy of the data should be
a
source of confidence to the
parties using the dat
 Throughout the supply chain, operational matrices and reports of status such as inventory,
forecasts, productions and shipments etc. of (company) should be easily accessible by all
key members of the supply chain. This type of information should be timely and accurate,
rendering its very useful for all parties for planning purposes.
 Company should undertake the deep impact analysis in order to identify the impact of the
supplier risk on the business on the earlry strage in order to make the arrangement so that
the supplier risk might not be that reactive to the company performance.
 Make a note about the vulnerable cyber attack on the information system of the business.
Cost cutting ways
 (Company) should make most of the space it have will save money at end of the day. As
storing in inventories and warehouse comes as a cost. Finding a space that’s more in line
with (company’s) actual needs will save money.
 (Company) should use a single software package for completing requistions or else it
might encounter situations where employees ending up using different applications
ordering too much of inventory supplies. (Company) need to implement an process for
approval so that nothing gets ordered without the consent of designated officials.
 Regularly looking at client demand patterns to get wheter something needs to be tweaked
or improved. Patterns can be found changing from month to month, seasons to seasons
and this information can be used deliberately to make most accurate decisions for supply
ordering.
 Products package should be better less likely your products will be damaged during
shipment. Ensuring the responsibility of this function to properly package and stacks
products as to avoid, or at least minimize damaging chances.
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 Outsourcing is a better way to reduce supply chain costs. Conduct proper due diligence to
ascertain whether or not service providers which are considered have ability to fulfill
enough of the productivity and efficiency benefit to justify your unbearable expenses for
such services. Outsourcing may lead to substantial savings and also a supply chain with
proper functionality.
CONCLUSION
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REFERENCES
Books and Journals
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