Challenges of Managing a Complex Supply Chain

It is a tough time for business owners and demand planners. There are too many uncertainties and too many variables. Reading the news causes fits and fatigue. There are times when sales are robust but you do not have the products in stock. There are other times, like right now, when the oppostive is true. But how much is too much and how little is too little. It would be nice to have inventory managed with some magic all knowing, all seeing process. Like a wad of money sitting on top of your inventory saying: "This is the money you could be saving with process A" like in the new Geico commercials.

Unfortunately, there is no magic wad of money. Though planning for future demand is ultimately a guess - it is not a trivial guessing game - it is a skilled process that relies on data collection, analysis, and robust communication and collaboration. You have to know the issues, the drivers behind the issues, and initiate reasonable solutions for the best possible inventory management.  Unless you are in a business that makes products that are specifically designed and built from scratch for customers, you must contend with managing inventory and all the headaches that go with it. 

Here are 3 articles that illuminate the challenges of managing a complex supply chain. The January 31st article in the Washington Post, Economy Sinks Under Weight Of Inventory, is very telling.

• Article 1: Oil Won't Stay Cheap


• Article 2: Freeing Working Capital Will Spare Firms in 2009


• Article 3: Economy Sinks Under Weight of Inventory