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Supply Chain Management

Construction Industry never really knew what supply chain really meant until outsourcing was found to be a better option and more effective (i.e. cost, work flow) way to doing things.

Traditionally, supplying of materials was more of a thing that many did not know the importance of. However as we all know, supply chain involves much wider perspective of just bringing in and out of materials needed but the integration of operations behind all the work in the project.


The Process

The process behind supply chain was not so complex and much costly in the previous life of business especially in construction. The shift in economy managed to label certain countries as powerhouse of manufacturing and the to go to when it comes to getting supplies. This gap in distance between the main contractor and its supplier would mean any loop holes in communication would lead to disaster or even resulting in costly damages. This damage extends from the primary producer all the way to the end-user when cost is in concern.

The Supply Chain Management has only one motive and it is to adopt a system which is efficient, cost saving and brings value to all that is concerned. The system of supply chain management goes about with certain basic procedure that has to be taken note of. Let us see how it all adds up to:

1) Identifying

Supply Chain Management starts right from the decision to be with another party and it all depends on how they can fill up the gaps of the company’s supply process. Surely, if the company is able to manage its supply, outsourcing it to another would mean an awkward idea to do so however, it does not stop there. The idea of this process does not only lies working externally. Supply Chain Management is a process whereby it creates a process or system which increase every party’s functionality in all department and other companies in concern.

2) Deciding

This stage is quite crucial as it sounds. Decision is always hard to make to normal humans, as individual. However when we talk about Supply Chain Management, it concerns parties coming together and laying out how each and every one can chip in. When they come into play in different stages of the project also play a part and how they are going to execute their roles too. This deciding stage makes everything clearer.

At this stage, it is very crucial to also decide that though we may have the resource to carry out a certain role, does involving other party that can perform the same role is much of a better option. The thing about making this exact part of the decision comes by when you have in mind if others were to do that role / job, will it make your company more efficient in doing other roles and also will it help to reduce some cost. Take for example, though your company has a manufacturing plant of its own, will it be more cost effective to actually work with other company to help you manufacture certain items such that their low manufacturing cost will help your company as a whole.

3) Managing

Last but not least, when all roles are decided, the last part is managing. A perfectly orchestrated discussion would mean no problems in the end you might think however problems will only be problems when you do not expect it. If you already expected such problem to happen without any back up plan then its better known as not being ready.  Such problem would normally arise because of certain things we cannot control such weather conditions during delivery, economic status during the process and others.

All in all, while managing is a big factor, keep in mind always that lead time, having ex stocks and the ability to monitor and gauge is also a micro factor you need to manage. Supply Chain Management in all honesty differs from company to company and industry. One might work for others but not the other. The main rightful thing is definitely having the basic things covered and  a system in place to cover the roles of different stakeholders.

God Bless.


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