According to the McKinsey Global Supply Chain Leader Survey 2023, almost 90% of managers say they have experienced major disruptions in their supply chain, confirming the central role played by the supply chain in overall business performance. Margins, service levels and customer satisfaction are now directly conditioned by the ability of organizations to anticipate, manage and secure their flows in the face of supply chain challenges.
This exposure is due to the scope of the supply chain and the growing complexity of operating environments, particularly in omnichannel contexts. Supply chain management encompasses all physical flows, from raw materials to finished products delivered to the end customer, as well as information and decision-making flows: planning, inventory management, warehousing operations, order preparation and transport network management, increasingly orchestrated with the help of supply chain software capable of centralizing decisions and making them more reliable.
When this chain is uncoordinated, the impact is immediate and measurable: stock imbalances, longer delivery times, higher operational costs and an increase in the number of emergency operations.
This complexity has increased sharply in recent years with the rise of e-commerce, increased pressure on delivery times, sourcing pressures and more stringent traceability requirements.
In this context, optimizing supply chain management is no longer just a matter of moving goods, but of orchestrating and synchronizing physical and informational flows, securing supplies and steering end-to-end performance to guarantee a controlled and sustainable level of service.
Why is effective supply chain management essential?
Effective supply chain management is based on the ability to coordinate procurement, inventory management, inbound and outbound logistics, transport and warehousing in a coherent way. It implies a global vision of the supply chain, from raw materials to delivery to the end customer.
In concrete terms, effective supply chain management is based on a combination of coherent, well-coordinated decisions. It starts with a reliable demand forecast, essential for anticipating the volumes to be produced, supplied and distributed. It then implies a clear organization of supply flows, to secure the routing of goods from suppliers to warehouses.
Supply chain management also includes inventory management adapted to operational constraints, taking into account lead times, warehousing capacities and service rate targets. It also includes controlled logistics execution, covering order preparation, handling and delivery. Finally, supply chain management is based on continuous risk and performance monitoring, supported by reliable indicators.
Supply chain management is not limited to a single department. It involves purchasing, production, logistics, information systems, logistics service providers and sometimes even customer relations. It is this cross-functional coordination that determines logistics performance and continuity of operations.
Step 1: Analyze demand and plan flows
All supply chain management begins with an understanding of demand. Without reliable analysis, logistics flows become erratic, and inventories serve as an adjustment variable.
Demand forecasting combines several key sources. Historical sales data provide the underlying trend, while seasonality and product life cycles enable us to anticipate variations, and promotional effects explain one-off peaks. More immediate e-commerce data completes the analysis, as does feedback from sales teams in the field, essential for adjusting volumes as closely as possible to operational reality.
This analysis is used to plan supply and production flows. It forms the basis for scheduling, inventory sizing and logistics planning.
In the retail and industrial sectors, inaccurate forecasts can lead to stock-outs or costly overstocking in terms of warehousing, handling and financial immobilization. The role of the supply chain manager is therefore to make this stage more reliable, often with the help of SCM, ERP or MRP tools capable of consolidating data.
Step 2: Structuring supplies and inventory
Choosing and managing suppliers
Procurement is the backbone of the inbound logistics chain. The choice of suppliers is not just a question of price: it is also based on reliability, respect for deadlines, the ability to work on a just-in-time or just-in-time basis, and the quality of the products delivered. Managing supplies involves clearly structuring supply lines, securing critical raw materials, anticipating alternatives in the event of disruption, and closely coordinating flows with carriers and logistics service providers. Conversely, poor organization quickly leads to rush orders, higher transport costs and long-lasting stock instability.
Defining an inventory strategy
Inventory management involves striking a balance between availability and immobilization. Stocking too little leads to stock-outs and a deterioration in service levels. Stocking too much incurs storage, handling and depreciation costs.
Several inventory strategies can be combined: safety stocks to manage uncertainty, just-in-time to reduce downtime, fixed-date or point-of-order replenishment, and product segmentation (ABC, XYZ) to adapt rules according to item value and variability.
The logistics manager must adapt stock management to operational constraints, the life cycle of goods and the variability of demand. This decision has a direct impact on logistics performance and delivery capacity.
Step 3: Optimize logistics operations
Logistics operations include warehousing, order preparation, transport and distribution. Optimizing them is a key lever in supply chain management.
In warehouses, supply chain management involves rational organization of storage areas, WMS support, reduction of unnecessary movements and more reliable order picking.
On the transport side, supply chain management aims to coordinate shipments, pool flows and control delivery times, against a backdrop of increasing regulatory and environmental constraints.
Efficient logistics is based on clear processes, well-defined responsibilities and precise tracking of goods flows, from the warehouse to the end customer.
Stage 4: Managing risk and building resilience
Risk management has become an integral part of supply chain management. Disruptions can come from a supplier, blocked transport, an IT incident or the vagaries of the weather. Enhancing resilience relies on clear risk mapping, contingency plans for critical supplies, diversification of sourcing and better visibility of flows and inventories throughout the supply chain.
The most robust companies are those able to anticipate and react rapidly, without disrupting the entire supply chain. This ability depends as much on organization as on the quality of the information available.
Step 5: Digitize and measure for continuous improvement
Leveraging technology
Digitalization is transforming supply chain management by making previously dispersed data visible. ERP, WMS, TMS, SCM tools and collaborative platforms centralize logistics information and automate some processes.
These systems facilitate real-time inventory tracking, physical flow traceability, supply management and logistics performance analysis.
Automation does not eliminate the role of the logistician or supply chain manager. It gives them the means to focus on arbitration, coordination and continuous improvement.
Supply chain management is based on key indicators: service rate, stock rotation, on-time delivery, logistics costs, supplier reliability. These indicators are used to monitor operations and drive continuous improvement.
Building a high-performance, resilient and sustainable supply chain
The performance of a supply chain is measured by its ability to ensure continuity of flows, control costs and maintain a high level of service, even in constrained and unstable environments. It requires close coordination between all players, clear governance of decisions and rigorous use of available data. The aim is not to apply a standardized model, but to design an organization aligned with the company’s structure, its business sector and its specific operational constraints.
Supply chain performance is built when decisions are based on reliable, shared and up-to-date information, when flows are orchestrated in a coherent way, and when risks are anticipated rather than undergone. This ability to steer, adjust and arbitrate on an ongoing basis transforms the supply chain into a strategic lever, capable of securing business, improving service levels and sustainably supporting company growth.
