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What should supply chain teams primarily focus on?
Supply chain teams focus on many initiatives. Is there an underlying principle that unifies all these initiatives?
The principle that unifies the effectiveness initiatives is the FLOW principle. We must maintain uninterrupted flow through the entire supply chain, from vendors till consumers.
Think of it like the circulatory system in our body, which controls the blood flow. A stockout is akin to a disruption in the blood flow, which could cause serious damage to the heart. On the other hand, pumping higher stocks is similar to high blood pressure, causing complications like stroke.
Just as our body maintains a consistent flow of blood in our body, our supply chain practices must maintain consistent supply of products without stockouts or surplus build-up.
If we focus on flow in the supply chain, everything falls in place.