Supply chain is one of the most important parts of any business, but is also one of the most misunderstood.

All businesses, regardless of size, industry, or location, require some sort of supply chain management that is the backbone of its success — or failure. According to a survey by Deloitte in 2014, 79% of companies with high-performing supply chains achieve revenue growth greater than the average within their industries, but only 22% of businesses take an active approach to supply chain design ( There is a great disconnect between the importance of supply chain and the paths businesses choose to follow for success.

Whether your company invests wholly in supply chain management, or you’re just getting started, there are ways to evaluate where it may need improvement. Advanced supply chains will decrease the time it takes for a business to run its transactions from start to finish. With that comes less money lost, less manpower wasted, and better customer service, all leading to a better business.

6 Things You're Losing with an Outdated Supply Chain

  1. TIME: Time is the first and most noticeable thing to go when using an outdated supply chain. A supply chain’s true purpose is to reduce the life cycle of your business from A to Z. Therefore, lost time by unnecessary use, inefficiencies, and wasteful processes are easy to spot when updating your systems.
  2. Customer satisfaction: Supply chain is vital to good client relationship. A smoothly designed and well-developed supply chain will reflect positively on your customers, whereas an outdated one will do the opposite. How? Clients can easily feel the effects of high lead times, delays in customer service outreach, or inventory shortages. Keep in mind the growing importance of the client relationship when updating or designing a supply chain by utilizing case logs and automated follow-up correspondence.
  3. Cash flow: A healthy supply chain finds unnecessary business costs and helps eliminate them. Transportation costs, procurement and inventory costs, and inadequate forecasting are just a few things that can be helped with a more optimized supply chain.
  4. Effective supplier relationships: “The supply chain, as its name suggests, is only as strong as its weakest link.” ( From the outside, you are one company, but it takes a village. You have a family of suppliers or vendors that work with you to create what outsiders see as one whole unit. Your supply chain may be equipped internally, but third party incongruities may create struggling supply chains. Get with your suppliers and ask the right questions.
  5. Proper inventory management: Do you have bottlenecks in the distribution department of your business? Chances are it comes from inventory issues. Supply chains can forecast busy periods and prevent a multitude of mishaps, including high lead times and holding costs.
  6. Quality team members: A poor supply chain affects the entire organization, not just clients and the bottom line. Employees may have to take on excess responsibilities to make up for a poorly designed system, or work longer, more strenuous hours. Customer service representatives can burn out from increased complaints and dwindling client satisfaction. Eventually, yours won’t be a great business for which to work, and in the days of full workplace visibility, this is crucial.

When you’re ready, include your team on conversations around these setbacks inside your organization, and work on advancing your supply chain system.