OVERVIEW
If you’re a business head or senior manager in a company that doesn’t usually use management consulting firms, or you simply don’t have much knowledge of working with consultants, you might even wonder why you’d ever need to.
However, every company eventually hits challenges or issues which for one reason or another, are simply beyond its ability to economically resolve with internal resources alone.
When these problems arise in your company’s supply chain operations, a management consulting partner can identify and analyse the problem, offer cost-effective solutions, and help assure smooth implementation, easily saving your company more than the applicable consulting fees, many times over.
Like anything though, there are certain ways and means of engaging and working with management consulting firms which if employed, will ensure you get the best from the partnership.
Making sense of supply chain consulting services
So let’s begin with addressing the question ‘Why would a company seek out for services of a professional supply chain management consulting firm?’
Well, as we said, challenges can arise which aren’t easy to resolve internally, but of course that’s a high-level and simplified catchall statement. It doesn’t really explicate the various reasons why a company might call on external expertise.
So let’s begin with addressing the question ‘Why would a company seek out for services of a professional supply chain management consulting firm?’
Well, as we said, challenges can arise which aren’t easy to resolve internally, but of course that’s a high-level and simplified catchall statement. It doesn’t really explicate the various reasons why a company might call on external expertise.
The main reasons that company seek out services of a supply chain consulting firm are:
To gather data
Supply chain development initiatives, or even efforts to resolve any problem, can often require the need for large quantities of precise, current data.
Management consulting professionals are skillful at digging up information and presenting it as usable data.
To solve problems
Complex supply chain glitches can be hard to detect, let alone solve with internal resources alone.
A supply chain management consulting company can analyse your supply chain from an objective, which often leads to exact problem identification and more effective solutions.
To assist with execution
In many cases, management consulting help concluding in recommendations for supply chain solutions to a problem. For instance though, it can be helpful to retain consultants through execution, especially for more complex projects.
To advocate actions
Once a problem is known, there could be several possible solutions. A management consulting firm can assess all possible solutions and make objective references as to which will be most cost-effective.
Hiring consultants for this purpose can be beneficial when possible actions may be politically sensitive or unpopular.
What are the primary benefits of a supply chain consulting firm?
After knowing why companies involve management consulting professionals now let’s move on to some of the advantages which apply even to resource-rich organisations.
The benefits of hiring consultants include:
Objectivity
Supply chain management consultant professionals can provide fresh viewpoints free from internal influences like culture and politics.
Focus
Management consultants have only one responsibility; to solve their client’s problem. Hence these external experts can maintain a laser focus on the issues to be resolved.
Scope of Experience
Your company might have experienced a given problem once only. But supply chain management consulting professionals have dealt with the same problem in different organisations and companies many times over, which means consultants have extensive experience and they know how to direct the problem or issue and its potential solutions.
Additional Skills
Experts from a management consulting company maintain skills essential for projects to be implemented successfully. These skills comprise project management, change management, communication, analytics and leadership.
Enumerated Change Benefits
Management consulting professionals can help you enumerate the benefits of change in your supply chain as they have extensive experience of change and improvement projects.
These steps all help to take guesswork out of change initiatives, build a solid business case for change and to produce measurable outcomes that meet stakeholders’ expectations.
When to Hire a Supply Chain Management Consulting Firm: Some Scenario Examples
Above we provided an overview of supply chain management consulting and the benefits that can be had from working with a consulting partner.
It’s time now to explore some typical situations in which your supply chain management team might benefit from consulting help.
Developing an Effective Supply Chain Strategy
Many research findings of organizations show that the majority of companies have no clearly documented supply chain strategy.
The problems don’t end there. Of the 30 to 40% of companies that do have a supply chain strategy, many find that somehow, their supply chain and logistics operations still don’t support the business as they should.
If developing an effective supply chain strategy would have been easy, a lot more than 45% of companies would have one. Without an effective strategy, your company’s supply chain will…
- Cost more to run than it needs to, reducing overall profitability
- Create service constraints, making customer satisfaction harder to achieve
- In the worst cases, it will oppose, rather than support the goals of your company’s business strategy
As tough as it may be to get supply chain strategy right then, you really need to ensure…
- That you have a supply chain strategy
- That it’s one which everyone can understand and buy into
- That it is completely aligned with the overall strategy of your business.
This is not about having someone come and tell you what your strategy should be though. A management consulting company will simply help you identify and plan the steps needed to build an aligned and effective supply chain strategy—one which matches the needs of your business, as defined by your business leaders.
Building a Better Distribution Network
How much do you know about the way your company’s distribution network is planned? Was it planned at all, or did it just evolve, just as is the case for many enterprises?
However, a network redesign can be a substantial and expensive project, and not one you want to execute very often. Hence it is necessary to get it right the first time—something a supply chain management consulting firm is perfectly fortified to help you with.
You’re probably well aware that software tools exist which can be used to model your network and test alternative scenarios, but…
- Do you have the people in your organisation with skills to use that software properly?
- Do you have the resources to commit to a hefty design project and if so, are they the right resources?
A management consulting partner can help you take a lot of the guesswork out of redesigning a distribution network, ensuring that nothing is missed and that the right tools and data are used to quantify the benefits of different “to-be” scenarios.
Making the Right Outsourcing Decisions
Poor outsourcing decisions can increase costs instead of reducing them, and can also prove detrimental to customer service.
Then there is the daunting task of finding the right partner to outsource to. You need to know exactly what to look for and how to evaluate the potential value of partnership. Business relationship must be developed between client and provider. Remember too, that your company won’t go through this process on a frequent basis, whereas third-party providers do it all the time. They know how to play the game.
A supply chain management consulting firm, like the 3PL companies from which you will choose, will have been through all the ups and downs of outsourcing many times over, which means they can help you maintain balance when negotiating with prospective logistics providers.
CONCLUSION
The reasons to hire a supply chain consulting firm are no different than the reasons one hires a doctor for health issues or a lawyer for a legal issue. Your company seeks specialized expertise to provide advice in an area of business where it is needed.
As concerned of the purpose for involving with external supply chain consulting professionals for advice, it is also essential for the firm to understand the landscape to make the right decision for your organization when hiring a right consulting partner.
In this blog of supply chain management consulting, we’ve explored reasons, benefits and few scenarios where it makes sense to bring in a consulting company.
I hope this blog helps your company make the right choice for supply chain consulting partner.
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