What can go wrong when investing in supply chain infrastructure?
By Charles Fallon
May 30, 2017 | 3 min read
Common Pitfalls When Investing in Supply Chain Infrastructure
Supply Chain Infrastructure consists of:
- Facilities required to process, manufacture, store and distribute products
- Equipment required to process, handle and transport products
- Technology required to plan, direct and execute the activities in the supply chain
Your infrastructure defines how your supply chain operates and determines how well it serves your company and its customers. It determines how quickly and efficiently products move through your supply chain. And it defines the processes used to convert raw materials into finished products that you then deliver to the market.
My entire consulting career has been focused on helping companies grapple with their supply chain infrastructure. In that time, I have seen companies across a range of industries make the same mistakes over and over again.
These syndromes include:
The Sore Tooth – Thinking about infrastructure only after capacity and performance problems become too painful to ignore
The Missing Link – Failing to recognize infrastructure as a foundational element of the company; affecting a wide swath of company activities from sourcing to sales and marketing
Separate Silos – Handing responsibility for different elements of infrastructure to different departments (e.g., facilities to operations and technology to IT) and letting them pursue separate strategies for each element
The Drunken Sailor – Squandering precious capital on infrastructure projects that look great in a press release but almost never provide the operating savings promised during the first pitch
Reach out to the LIDD team to learn more about warehouse slotting and optimizing your warehouse operations.