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Minimizing supply chain disruptions requires taking a best-in-class approach from the highest levels of the company. Recent news reports about flaws in diverse productsfrom a leading smartphone application to a highly anticipated aviation product, to the recent horsegate affair in Europehave focused on the large number of suppliers in the chain, potentially creating the impression that the scale of the supply chain might in and of itself have been a contributing factor in these quality control failures. While theres no question that the number of suppliers in a supply chain can, in some instances, result in a product flaw, for almost any product theres far more involved in quality control than just the number of suppliers. If all the recent media attention to quality control has made you think twice about your own supply chains capabilities, its worth stepping back to take a fresh look at how it compares to best practices. Supply chains can be defined as the movement of three critical resources: materials, information and money. A failure in the movement of any of these can lead to a failure of the entire chain, whether there is only one supplier or hundreds. If a payment is late, a part held up, or theres no data or misleading data available to track a component, the supply chain will fail. And, to build on this, if you think quality in a supply chain is just having the right materials in the right place at the right time, youre not thinking broadly enough. Supply chain management must also focus on the quality of the materials, the accuracy and content value in the information shared between supplier and customer, and the accuracy and timeliness in the financial transactions. As a CEO, you may not be directly responsible for the inner workings of your companys supply chain. But your supply chain is a huge contributor to the safe and timely delivery of your goods to customerswhich means its critical to your financial success. It literally pays to be proactive in making sure your supply chain is designed for success, and that means asking some key questions about it: 1. Is quality built into your supply chain, or do inspection and correction occur after the fact? 2. Is supply chain management a strategic senior level position in your organization or is it a part of an operations activity? 3. Is the movement of information and money as critical in your supply chain as the movement of materials? In other words, does it take longer to create paperwork and process payments than it takes to deliver the goods? 4. Do you have a built-in change management process that constantly reviews the elements of your supply chain and looks for opportunities to improve quality and operational efficiencyor do your systems, policies and procedures block improvement? 5. Does your supply chain minimize the amount of touches and the touch time in supply chain transactions, so as to reduce the number of potential failure points?
Brian Nolf is global supply chain management practice head for Wipro Consulting Services. He is based in London, UK. Gerhard Plenert has written extensively about supply chain strategy, most recently as co-author of Driving Strategy to Execution Using Lean Six Sigma(CRC Press, 2012). He is based in Sacramento, Calif. Source URL: http://www.industryweek.com/inventory-management/five-questions-ceos-should-ask-about-theirsupply-chain