How To Develop An Efficient Supply Chain Map

When I was invited to publish some words in the “Logistics and Transportation Review,” I wondered what a usual head of logistics in a third world country as Brazil could write about supply chain processes to a media vehicle that reaches so many different cultures and realities. I started to think about infrastructure differences between regions or even higher access to new technologies and platforms, but we all know about different difficulties, laws, cultures and special situations that makes logistic so broad and specific at same time.

Considering this level of complexity, I found out what logistics is really about. It is about CREATIVITY!

Nowadays there is a  very strong  need to have a big insertion of technology in order to enhance efficiency and solve problems caused by industry volatility affected by worldwide issues like the recent pandemic and Ukraine war that extended for almost one year.

Therefore, I started to think about how to build a scenery to talk about creativity in logistics environment and found out that the biggest challenge now is about the dilemma between people and technology. Everybody knows that people and technology are the base of modern logistics, but in my point of view, we are facing a time where people think that technology can solve everything, which is right, but not all problems will be solved by only using technology or even by using the edge of technology.

We need to measure the breaking point between processes and technology.

I am responsible for network transportation and 4PL/LLP initiatives in Brazil. It’s very usual that I prospect our services and technology to potential customers and we all have the tendency to show what we have the best in our portfolio, but we often meet customers that even have an ERP or MRP running accordingly or have structured processes that can be automated or improved by some kind of standard software or application available in the market.

That’s what is happening today. Hundreds of companies and thousands of startups are offering solutions for any kind of problem, but people are not able to wonder if the solution will really touch the right point that is creating the roadblocks. It means that professionals go to the market looking for a solution but it is very usual they do not have a clear vision about their problems and can be harmed by a bad decision of where to invest money and time.

It is very usual that we meet people that want to have something to help but are not sure about what they need. 

People start to look for technology and forget that sometimes they need to rebuild their own processes before betting on a new technology. This results in a lot of cases of bad implementations and millions spent on systems that really don’t solve the core problems in many companies.

So that’s where creativity enters!

In my opinion, it is crucial to understand what the current process status of your company is. It is more important to discuss the problem itself because every problem comes from a specific process failure, which sometimes is not so easy to see and understand.

In this point, the best solution to create or adjust your supply chain process could be not the state-of-the-art service but maybe something more basic that is able to cure the real pain of the process.

To exemplify: I was once talking with a potential customer and he was looking for a full Control Tower solution. They explained me that they were spending a lot of money with freights and needed to control all the routes and occupation of the vehicles. We started to scribble the phases of their processes in a simple A4 paper and quickly identified that the problems were not caused by network design but by a lack of synchronism in the pickup and delivery during the complete cycle of the sourcing process. So, we swiftly proposed a solution where we could receive their orders, process it and schedule the transportation in synchrony with the supplier delivery and the plant materials reception considering the production volumes and size of the inventories.

Immediately, we used our expertise and tools to draw a much simpler solution to the customer but good enough to solve the real pain they were dealing with. We developed the interfaces and process to assure this new approach worked fantastically and in the end, they won and we won.

That describes what I was trying to explain. It is not always the solutions are written or covered by some kind of “fashion solution”. Sometimes we need to go back some steps and find what really cures the pain. And to do that, we need to have an open mind and a low-profile behavior. Best in class solutions are what people are looking for and it is very usual to see cases where people want the best and forget to think out of the box. And creativity is the key to think out of the box.

“If we discuss the dilemma about people and technology, I will bet more on people.”

So, if we discuss the dilemma about people and technology, I will bet more on people. We are able to overpass problems by just using the tools we have in hand or even some more practical or simple solution. Besides, none of us wants to buy a Ferrari to go to the farm, right?

What we need to always have in mind:

1. Review the supply process all the time. Even when you think that you have already covered everything. Be tireless.
2. Exhaust possible solutions you have in-house. Sometimes the department beside of yours uses a certain technique or tool that you can apply with some adaptations.
3. Don’t be afraid to change your process.Be creative. Get out of the comfort zone and take the risks.
4. Always practice benchmark. With your customers and suppliers and even with competitors. Sometimes it is not difficult to discuss day-by-day problems that are faced for everybody.
5. Be simple. Try to use exactly what you need. You can make improvements later.
6. When the problem is more complex, try to use the old and good “war room”. Mix people of different areas and knowledges and be aware about every given idea.
7. Be open to hear from everyone independently regardless of their position or level in the company. More than this: hear more and always.

I do not want to teach to a group of experienced professionals like you about efficiency but always keep in mind that the best solution is the one where you can fit the size of your problem and the size of your tools. An efficient supply chain must be just what satisfies the end customers with a minimum cost at all.