CSCMP's Supply Chain Quarterly
October 19, 2018

Time to go on the offensive

As the economy shows signs of renewed life, the time has come for a change of supply chain strategy.

During the Great Recession, supply chains played defense. The supply chain strategy for most companies focused on cost control, and supply chain chiefs scrutinized their operations to find ways to free up working capital.

But as the economy (in the United States at least) shows signs of renewed life, the time has come for a change of strategy. Now, supply chain executives need to go on the offense. That means looking for ways to use the supply chain to grow their company's top line and increase sales and revenues.

Supply chains can facilitate sales growth in a host of ways. It could involve building plants or opening a distribution center to support the introduction of a new product line or expansion into a new market. Along with a supply chain network reconfiguration, additional carriers or third-party logistics partners may be required to deliver goods to new customers.

Companies also can use their supply chains to develop new services that will gain additional customers. For example, they could provide same-day fulfillment or even same-day deliveries of orders. Or their warehouses could provide special display packaging or assortments targeted to a particular market segment.

Going on the offensive—using the supply chain to support revenue growth—is likely to require making some critical investments. These kinds of initiatives often call for investment in new technology, particularly software. And it may be necessary to bring new talent into the organization.

As the old saying goes, it takes money to make money. Supply chain executives should be prepared to make the case to upper management that the rewards of additional revenue justify investment in supply chain operations.

James A. Cooke is a supply chain software analyst. He was previously the editor of CSCMP's Supply Chain Quarterly and a staff writer for DC Velocity.

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