A recent article over on Supply Chain Digest purported to tackle supply chain at the core. I thought it would be about the core of the supply chain, but instead it was about how the supply chain is now the core of most companies. For example, GM just attributed it’s 7% increase in gross margins to manufacturing & distribution (supply chain), a 2B consumer goods company has realized that their supply chain is the key to their success, and the lack of supply chain sophistication is what allows private-equity firm Frontenac to buy companies at a discount and make profitable ventures out of them (by installing proper supply chains and supply chain management).
I was curious as to what they’d say about the core of a modern supply chain. A Google search for “supply chain core” turns up core disciplines, planning and optimization, and lean six sigma, which, while important, all miss the point. Which is very simple.
The three-pronged core of the modern supply chain is the same as it’s always been — people, process, and platform. The only difference is that the people are more skilled, the processes are more involved due to the truly global nature of the modern supply chain, and the modern platform is a sophisticated tangle of modern technology. But the core is still the same — good people, good processes, and good platform. Everything else is just a layer.