Whether you want to enter the industry as an aspiring student or are seeking to further your supply chain or logistics career, a firm grasp of global supply chain issues and disruption mitigation best practices is essential. Read on to learn more about supply chain disruption and tips for fostering resilience. 

Understanding Supply Chain Disruption

From international military conflict to climate change, many factors can directly or indirectly hinder supply chain operations. In recent years, a series of important global events have led to significant and ongoing global supply chain issues.

The Impact of Global Events on Supply Chains

Many earth-shattering events have contributed to global supply chain disruption and vulnerability over the past five years alone. When the COVID-19 pandemic began to spread across the globe in 2019, it brought with it a lasting supply chain crisis fueled by dramatic spikes in demand for critical products and skyrocketing e-commerce activity, among other factors. Subsequent obstacles to unencumbered trade and shipment include the Russian invasion of Ukraine in 2022 and the significant physical disruptions at both the Panama Canal and the Suez Canal in 2024. The impact of these global events on supply chain operations has proven substantial, enduring, and costly.

Identifying Common Causes of Disruption

Beyond industrial accidents, military conflict, and political unrest, cyberattacks pose a significant threat to global supply chain stability. In addition to these entirely human/societal causes of supply chain disruption, natural disasters such as earthquakes, wildfires, and extreme weather events can make it entirely impossible to transport goods from one location to another.

Building a Resilient Supply Chain

According to the Fortune 500 firm Gartner, supply chain disruptions are now a certainty, being constant and unpredictable. The critical question to address is whether your organization is prepared to mitigate the next global supply chain disruption or other supply chain risks that arise.

Strategies for Risk Assessment and Management

To boost supply chain resiliency, Gartner stresses the importance of three strategic categories: visibility, resilience, and agility. Initiatives that focus on visibility can help supply chain professionals identify risks early and react to them accordingly. Initiatives that focus on resilience aid in the development of supply chain systems that resist, absorb, and recover from disruption. Additionally, initiatives that focus on agility focus on rapid response to supply chain disruption to avoid or minimize its negative impacts.

Importance of Flexibility in Supplier Selection

Stressing agility means ensuring flexibility in your choice of suppliers. Beyond seeking out suppliers that draw from a multitude of sources, companies should be prepared to pivot to others when current supplier performance falls below expectations or needs. To learn more about the importance of supply chain diversification, see the “Diversification as a Key Mitigation Strategy” section below.

Leveraging Technology for Supply Chain Continuity

Over the past several decades, digital technology has completely transformed the supply chain sector, dramatically enhancing capabilities to boost resilience by both assessing and managing risk.

The Role of AI and Machine Learning

The Michigan Manufacturing Technology Center (MMTC) recognizes artificial intelligence (AI) as a revolutionary technology reshaping supply chain management. AI applications in this field include predictive inventory analytics and real-time shipment tracking. According to MMTC, AI has the potential to enhance almost every aspect of the supply chain.

Implementing Blockchain for Transparency

In addition to AI, blockchain technology has provided significant strategic advantages in the global supply chain by enhancing transparency among the various companies involved. According to Deloitte, each business in the supply chain network contributes value to a product or service before it reaches the end user. This value exchange is recorded through transactions involving information, goods, services, and finances. A ‘permissioned blockchain’ can record these transactions on a shared, immutable ledger, enabling data capture, validation, and sharing across interconnected companies. This transparency fosters mutual trust and reduces supply chain risk.

Diversification as a Key Mitigation Approach

Supplier diversification up and down the supply chain can be a beneficial strategy for managing the risk of disruption. Although the heart of this strategy involves relying on multiple suppliers rather than one consolidated source, the types and areas of diversification might differ considerably from industry to industry. 

Geographic Diversification of Suppliers

Businesses can make their approach to diversification considerably more strategic by specifically considering geographic advantages and drawbacks. For example, adding supply chain links at the local level might cost more upfront but also generate lasting value through increased inventory control. One popular geographic diversification trend to consider is nearshoring, also known as moving production or supply operations to a nearby country rather than remaining with operations farther away. Nearshoring has proven an effective way to both mitigate disruption and shorten shipping cycle duration.

Product Sourcing and Inventory Diversification

If you want to ensure that your business has the products that it needs on hand, multisource supply chain strategies are key. Even if you secure a single supplier that can reliably source a product from several locations, you may want to maintain relationships with one or more second-tier or auxiliary suppliers to work around unforeseen supply chain disruptions that might arise. To maximize your multi-sourcing efforts, you would be wise to investigate inventory diversification opportunities, including using other products or raw materials if they are easier to access and transport.

Strengthening Supplier Relationships

While it is generally a good idea to acquire new suppliers to diversify your supply chain, it is equally advantageous to foster reliable, long-term relationships with your existing suppliers. An organization can save a tremendous amount of hassle and money by establishing and maintaining mutually beneficial partnerships with suppliers that they can trust to deliver high-quality goods on schedule.

Collaboration for Improved Supply Chain Visibility

Supply chain expert Efrata Denny emphasizes the importance of collaboration in supplier relationships, ranking it as the top reason to maintain strong ties with key suppliers. He explains that when suppliers are regarded as partners, the resulting collaboration creates a powerful synergy that drives organizational success.

Establishing Strong Communication Channels

Denny highlights that successful collaboration relies heavily on clear and open communication. He stresses that communication must be ongoing throughout the supply chain, not just during the contract negotiation phase. Regular updates, meetings, and feedback sessions are essential for maintaining alignment, making timely adjustments, and swiftly resolving any issues that occur.

Preparing for the Future of Supply Chains

The only true constant in supply chain management is change. Therefore, savvy supply chain professionals must plan for the industry’s immediate and distant future.

Trends Shaping the Future of Supply Chain Management

As detailed previously, innumerable natural and human-made issues can profoundly influence supply chain operations. Looking to the future, Gartner has identified trends in the following areas shaping the future of supply chain management for both the better and the worse, including trade policy, labor, energy, global health, sociopolitical unrest, and ESG (environmental, social, and governance).

Adapting to Changes in Consumer Demand and Regulation

In an issue brief on supply chain resilience, the White House listed industry transparency and public sector intervention as the two key factors driving global supply chain resilience. Both of these factors involve responding to rapid changes in consumer demand and adhering to evolving industry regulations. Among other things, this means improving access to relevant supply chain data and diversifying supplier sourcing in the many ways outlined in the “Diversification as a Key Mitigation Approach” section above.

Frequently Asked Questions

Anyone with a significant interest in supply chain management is likely to ponder one or more of the following FAQs about responding to global supply chain issues and risk mitigation.

Improve Your Global Supply Chain Strategy

You need a professional command of global supply chain strategy if you want to deliver optimal supply chain resilience. For this reason, among others, a supply chain/logistics industry-focused diploma is quite important. To learn more about what a practical education in the global supply chain can do for you, examine the Global Supply Chain & Logistics Management Diploma at North American Trade Schools (NATS) and enter your contact information in the “Connect with NATS” section for additional details.

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In today’s hyperconnected and e-commerce-driven world, international consumer and business transactions are more common than ever. Global commerce and trade can undoubtedly be quite lucrative, but it can also be complex and time-consuming to navigate. Chief among such obstacles that international importers and exporters must endure are border and customs clearance processes.  

Fortunately, organizations in Canada and elsewhere can significantly simplify and streamline customs and border clearance processes by approaching them with thorough preparation and strategic logic. Read on for some key guidelines for making Canadian customs clearance more straightforward and more efficient.  

What Is Customs Clearance? 

Briefly defined, customs clearance refers to the procedures one must follow and processes one must complete to import or export items and goods across international borders legally. Conducted under the authority of sanctioned government officers, it might involve anything from providing invoices and proof of insurance to passing pre-shipment inspection and other examinations. 

Key Components of the Canadian Customs Clearance Process 

For companies and individuals alike, the first step to importing or exporting goods over Canadian borders is to obtain a business number (BN) for an import/export account through the Canada Revenue Agency (CRA). There are no charges associated with securing a BN, and the entire application process takes just a few minutes. 

To get a new BN or add an import/export account identifier to a current BN, call the CRA at 1-800-959-5525 or see the CRA Business Registration Online section of the official Government of Canada website. When you are appropriately registered with the federal government, you can then begin considering the following key components of the Canadian customs clearance process. 

Documentation Requirements 

The documentation required to import goods into Canada is substantially more extensive than the documentation required to export goods out of it. Importers must begin by identifying the specific type and amount of goods they want to bring into the country, gathering as much information about them as possible. “Obtain descriptive literature, product composition information and, whenever possible, product samples,” stresses the Canada Border Services Agency (CBSA). “This information will be crucial when it comes time to determine the tariff classification of the goods you wish to import.”  

Tariffs are government fees imposed on imported items from various countries. Different items not only come with different tariffs but also require different documentation. While you should check with CBSA officials to ensure you have all the necessary documents to complete your intended import processes, the brokerage and trade consultancy Livingston identifies four documents that must accompany every shipment coming into Canada: 

• Canada Customs Invoice (CCI), or commercial invoice – Primarily used to calculate tariffs, the Canada Customs Invoice identifies both the buyer and seller, the countries of origin and destination, and detailed information about the goods being shipped. 

• Bill of lading (BOL) – Commonly known by the acronym BOL, this document is issued to the shipper of goods from the carrier of goods. BOLs allow importers to obtain merchandise and exporters to receive payment. Shipment tracking numbers are key elements of these documents. 
• Manifest or cargo control document (CCD) – Cargo control documents CCDs (otherwise known as manifests) go beyond cargo content details and names of importers/exporters to include information such as the type of shipment transportation as well as the captains, pilots, crew, and passengers that this transportation carries. 
• Shipper’s Export Declaration (SED): This document records every individual import shipment to its final domestic destination. One of its primary purposes is compiling international trade statistics. 

Although exports leaving Canada typically require fewer and less stringent government barriers, many goods that are (in the words of the CBSA) “controlled, regulated or prohibited may require export permits, certificates or licenses from other government departments and agencies.” These goods range from bodies or body parts and human pathogens to explosives that include both fireworks and ammunition. For a complete list of these restricted exports, see the “Goods That May Require Export Permits” section of the CBSA website. 

Tariffs, Duties, and Taxes 

Beyond the tariffs discussed above, the CBSA may also levy duties that vary according to the type of goods imported and their country of origin. For example, the organization applies an excise duty on certain imported luxury items. CBSA duty calculations also reflect the overall value of the goods in Canadian funds. 

The Canadian government levies a standard 5% Goods and Services Tax (GST) on all imported items, including those sent through the mail. However, goods sent by mail worth $20 (in Canadian dollars) or less are exempt from this tax. Gifts from friends or family members abroad can be worth as much as $60 before the GST applies. Individuals and organizations can also register for specific GST credits and rebates. 

Though the definitions of tariffs, duties, and taxes tend to overlap and blur together, they also have their distinct attributes. Tariffs apply to specific products from certain countries at particular times, duties are primarily based on cargo characteristics, and taxes are generally fixed and calculated on total cargo value. 

Customs Procedures and Compliance in Canada 

Eager to move through all necessary import and export customs procedures in full compliance with Canadian law? The CBSA presents the importation of goods into Canada as a comprehensive six-step process: 

1. Preparing to import by compiling all necessary shipper, receiver, cargo, and transportation information  

2. Classifying your goods according to relevant government regulations 

3. Determining all applicable tariffs, duties, and taxes 

4. Physically shipping and officially reporting your goods 

5. Seeking the official release of your goods 

6. Taking key steps after your goods are released 

Your primary imperative after the release of your goods will be to double-check your import/export records to immediately report any errors in the accounting information you have submitted to the Canadian government. Then, you should safely and securely store all documents pertaining to your import for at least six years. During this period, your import may be subject to verification and adjustment by the CBSA. 

Leveraging Technology for Streamlined Clearance 

Although the import and export customs process can be complicated, modern technology has made it much simpler by automating routine tasks, reducing manual paperwork, enhancing supply chain security, and providing real-time shipment tracking and transparency. Industry experts recommend the following forms of technology for import/export professionals who can benefit from them: 

• Electronic Data Interchange (EDI) and Automated Broker Interface (ABI) – Facilitates data transmission between customs brokers and relevant government agencies. 

• Automated Commercial Environment (ACE) – Facilitates the reporting of imports and exports between Canada and the United States. 
• Automated Customs Declarations Processing (ACDP) – Facilitates cargo valuation, origin declaration, tariff classification, and duty calculation. 

Global Supply Chain Management and Customs in Canada 

If you are an existing or aspiring supply chain manager who deals with international shipments, you should keep a few “big picture” factors in mind when approaching the role of import/export customs in your chosen profession. 

The Role of Logistics Management 

The pace, cost, and dependability of the customs clearance process will impact the pace, cost, and reliability of your international supply chain. Faster and more efficient customs clearance will give you a distinct competitive advantage as a supply chain manager. 

Coordinating With Canadian Suppliers and Distributors 

Choosing your partners wisely is a big part of supply chain success. Consider working with Canadian suppliers and distributors that thoroughly understand domestic customs procedures and processes. 

Compliance With Canadian and International Regulations 

Planning and preparation are essential to facilitate full regulatory compliance. Carefully research all pertinent regulations and requirements for Canada and any other country involved in your import and export operations. Be sure to obtain and complete all necessary documents in a timely manner. 

Strategies for Effective Customs Clearance in Canada 

Whether you are a supply chain professional, an importer/exporter, or another interested party, you can optimize your customs clearance knowledge and skill by: 

Staying Informed 

The logistics and transportation news source Inbound Logistics acknowledges the complexity of the customs clearance process but insists that it can be a smooth experience if you know what you are doing: “Because regulations and best practices are constantly changing, staying current on the latest developments in the customs world is an absolute must.” 

Following Accurate Documentation Practices for Canadian Imports 

After ensuring you are up to date on all current information and practices, you must use this information to fill out all required forms precisely, accurately, and completely well in advance of your scheduled import/export shipment date.  

Practicing Proactive Compliance Management in the Canadian Market 

It is crucial to anticipate bumps in the road—such as multiple customs clearance checks and unexpected tariffs, duties, and taxes. In addition to following best practices, taking thorough stock of the goods you are shipping can help you navigate the process. 

Earning a Global Supply Chain Management Diploma 

In Canada and elsewhere, you need a strong command of import and export customs clearance fundamentals if you wish to thrive as a supply chain manager or another international business professional. You can gain the many tools that lead to success through a high-quality global supply chain management program like the Global Supply Chain & Logistics Management diploma at North American Trade Schools (NATS). For more information, complete our short “Connect With NATS” form online today.  

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A global supply chain manager is responsible for the worldwide product flow management of an organization. During global supply chain and logistics training, you will learn a wide variety of skills to prepare you for the role.

During your logistics management diploma, the skills you will learn include data analytics, contracting, operations management, quality management, customs and global trade compliance, warehousing, communications, and supply management. 

You also have the opportunity to sit the Canadian International Freight Forwarders Association certification exam and the Lean Six Sigma Yellow Belt certification exam. Your training will thoroughly prepare you to succeed in a global supply chain and logistics role, however, to do this, you also need good foundational skills.

Discover the essential skills needed for global supply chain and logistics training. Check out this infographic!

[Infographic] 4 Important Skills To Have If You’re Considering Global Supply Chain And Logistics Training

1. High Attention to Detail

Being detail-oriented is important: 

• Every aspect of the logistic process is crucial and plays an important role. 
• You’ll need to focus on the details to ensure success throughout the supply chain. 
• High attention to detail often results in consistently improved systems and processes.
• Being attentive helps avoid mistakes. 

Indicators you have high attention to detail include: 

• Double-checking your work.
• Being a person who manages their time well. 

Strong attention to detail enables thorough evaluation of operations, minimizing errors in the workplace

2. Strong Interpersonal Skills 

Managing and communicating effectively is important: 

• In a management role, your ability to communicate effectively is important. 
• Effective communication and robust interpersonal skills are essential for interacting and negotiating with business partners. 
• Be customer-oriented to ensure client satisfaction and continued business. 
• Strong listening and effective communication skills, will help you thrive in a global supply chain management role. 

Indicators that you have strong interpersonal skills include: 

• You can collaborate with others whenever needed. 
• You can communicate your ideas in an easy-to-understand manner.

You need to be able to communicate effectively with team members and customers to succeed in the role.  

3. Adaptable in all Situations  

Situations change and being adaptable is important: 

• Successfully managing and solving logistics challenges is key to excelling in your role.
• You must think quickly, analyze situations, and devise solutions under pressure.
• Adaptability in learning new systems and processes is crucial as they evolve. 

Indicators that you have effective adaptation skills include: 

• You work well under pressure.
• You enjoy problem solving. 
• You commit fully when mastering new skills.  

In changing situations, swift and clear adaptation and decision-making are essential.

4. Know Technology  

Being technologically savvy is important: 

• Supply chains are complicated and require software and programs to remain up-to-date. 
• The software and programs streamline tasks and information.
• Knowledge of computer systems is crucial.
• In larger companies, technological processes become more complex due to the increased volume of information to manage and update.

Indicators showing you have strong technical skills include: 

• You know how to navigate a computer system well, including Microsoft Suite. 
• You can efficiently utilize programs, quickly mastering their features to accomplish tasks.

Understanding and working with technology is fundamental to a global supply chain and logistics role.

Sources: 

https://www.indeed.com/career-advice/career-development/logistics-career-skills

https://www.logisticsbureau.com/7-key-supply-chain-leaders-skills-and-why-you-need-them/

https://www.techtarget.com/searcherp/feature/5-skills-supply-chain-professionals-need

http://www.taylorollinson.co.uk/assets/Competencies.pdf

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The logistics industry has undergone a seismic shift after the global pandemic. The pandemic has significantly affected supply chains, transportation, and logistics worldwide. Trade restrictions, port closures, and workforce reductions have led to disruptions, obliging logistics professionals to adapt swiftly. With a surge in e-commerce, evolving customer expectations, and ongoing supply chain disruptions, the landscape for logistics training graduates has become more dynamic than ever. 

Fresh out of logistics training, you’re equipped with the knowledge and skills to navigate this new reality. However, translating textbook concepts into practical solutions in a post-pandemic world requires a strategic approach. This blog post highlights some key areas to focus on as you embark on your logistics career:

Embrace Flexibility and Adaptability and Deepen Your Understanding of E-Commerce

The pandemic highlighted the importance of agility in the face of unforeseen circumstances. Gone are the days of rigid, linear supply chains. Today’s logistics professionals must be adaptable and capable of quickly pivoting strategies and workflows to address disruptions. 

This means staying abreast of industry trends, emerging technologies, and geopolitical issues that could impact global trade. Familiarize yourself with alternative solutions, such as diversified sourcing strategies and multimodal transportation options. 

As most logistics courses highlight, E-commerce has become a dominant force in the retail landscape. As a logistics professional, understanding the intricacies of e-commerce fulfillment is crucial. 

This includes knowledge of warehousing and inventory management specific to e-commerce needs, such as streamlined picking and packing processes, efficient last-mile delivery solutions, and robust reverse logistics systems for returns and exchanges. 

Familiarize yourself with e-commerce platforms and marketplaces and the fulfillment models they utilize. Understanding customer expectations for fast, reliable deliveries is paramount.

Leverage Technology and Prioritize Data Security

Technology is transforming the logistics industry at an unprecedented pace. Various tools can enhance efficiency, productivity, and data-driven decision-making, from warehouse automation to blockchain-powered supply chain tracking.

Embrace opportunities to learn about and utilize logistics management software, warehouse management systems, and transportation management systems. Familiarity with data analytics tools will position you well as companies increasingly rely on data to optimize operations and predict demand.

Cybersecurity threats are growing in the logistics industry, where valuable data is constantly moving. As a logistics professional, you play a vital role in protecting sensitive information such as customer data, trade secrets, and shipment details. 

Develop and implement best practices for data security, including vital password hygiene, awareness of phishing scams, and adherence to data privacy regulations. 

Develop Strong Communication Skills and Build Your Network after Logistics Training

Effective communication is vital across industries, but it is especially crucial in logistics, where efficient collaboration between departments and external partners is key.

Work on refining your written and verbal communication skills during and after your logistics training. Practice active listening and clear articulation during meetings and negotiations. Effective communication fosters trust and transparency, leading to better problem-solving and smoother workflows.

Building strong professional relationships is vital to career growth in the logistics industry. Attend industry events, connect with logistics professionals online, and don’t hesitate to engage with industry experts. 

Mentorship from experienced professionals can provide valuable insights and guidance as you navigate your career path. Additionally, a strong network opens doors to new opportunities, allowing you to stay current on industry trends and informed about job openings.

Are you looking for world-class career training?

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The ultimate goal of operations planning is to properly and consistently align and optimize the flow of supply chain resources to satisfy customer demands efficiently at all times. Because proper operations planning is key to the success of every logistics business, it is essential to have the right approach. 

If you’ve just finished your Supply Chain and Logistics training and fancy a career in operations planning, you’ll find the information here very valuable. Here are some important tips for operations planning to keep in mind on your journey. 

Map Out Your Supply Chain Process Flows

The process flows around your supply chain and provides a trail of activities that allow you to track your operations planning. To understand these process flows and their implications on your supply chain operations, map them out extensively and observe every detail. Document the sequence of events from the time of order and procurement through the storage, distribution, and delivery processes leading to the final consumer. 

Also, highlight all the inputs, outputs, logistics, operations, and key players actively participating in each stage and analyze their interaction. When you do this properly and effectively, you will have figured out any gaps, inefficiencies, and problem points in your supply chain.

Logistics Management Training Teaches Comprehensive Supply Chain Infrastructure Analysis

When you conduct a thorough supply chain infrastructure analysis, you can find out what works well, optimize those processes, and identify areas needing improvements or upgrades. This analysis should cover the condition of your warehouses, transport fleet, staffing capacity, equipment, and other technology systems that your supply chain operations rely on. 

This allows for easy discovery of any bottlenecks, outdated processes, and capacity constraints that impact your operation. After identifying your operational challenges, you can now make plans and deploy the right personnel to make all the necessary improvements. This analysis process is emphasized in most logistics management training programs as it helps pave the way for more informed decision-making by logistics managers. 

Examine Supply Chain Key Performance Indicators (KPIs)

Your KPIs are key to evaluating your supply chain’s performance level in line with set parameters and standards. When you assess your supply chain’s KPIs and compare them to industry standards, you can find out what competitive gaps need closing and what standards need reinforcing. Your KPIs typically include total supply chain costs, inventory turnover rates, and lead times. 

They influence many activities accounted for in your operations planning and define your supply chain. And because they constantly change as operations play out, you’ll need to put them within range of a regular monitoring system. This way, you’ll always know what direction to take while planning your operations.

Identify Risks and Create Actionable Mitigation Plans

Risk analysis in operations planning is a feature of many logistics management courses due to its importance. While carrying out operations planning, it is important to do proper risk analysis around your supply chain. Your risk analysis should cover all activities in your operations, from supply to distribution and delivery. 

After examining the various risk factors associated with your supply chain operations, you can make appropriate mitigation plans. If you find that there’s potential for a particular process to no longer be applicable, reliable, or practical, you can create a contingency plan to cover it. 

Are you interested in a logistics management diploma?

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Whether you are a novice just considering a career in supply chain/logistics operations or are a seasoned career veteran adapting to modern industry sensibilities, a firm understanding of green supply chain practices is essential. As business leaders and general consumers become more aware of environmental issues, the topic of sustainable supply chain management has become a prevalent subject among professionals, academics, and the public at large.

Understanding Sustainable Supply Chain Practices

The term ‘supply chain sustainability’ encompasses all supply chain/logistics practices with environmental benefits. Professionals can improve sustainability across the supply chain by sourcing eco-friendly materials and reducing carbon emissions in delivery. 

Because they often focus on the efficient use and optimized consumption of resources, green supply chain practices can generally streamline operations and deliver a solid return on investment (ROI). Most sustainable supply chain practices adhere to one or more versions of the common ‘5 Rs,’ driving improvements in areas such as reduction, recycling, reuse, redesign, and rethinking.

Importance of Sustainability in Supply Chain and Logistics

As described above, the definitive characteristic of a green supply chain practice is its ability to cut carbon emissions or address other key environmental concerns. We have also mentioned that sustainable supply chain practices can boost efficiency, cut costs, and improve an organization’s financial bottom line. However, there are other common green supply chain benefits, many of which will be covered at some length as this article progresses. Sustainability in the supply chain can:

• Improve public reputation and consumer outreach.
• Foster and strengthen community and professional partnerships.
• Create “win-win” business opportunities.
• Benefit local hiring and fair labor practices.
• Promote a positive and productive work culture.
• Aid in general chain risk mitigation.
• Drive ongoing supply chain improvements.

How Sustainable Supply Chains Drive Business Transformation

Even the most eco-friendly organizations must focus on operational efficiency and ROI. With these ‘bottom line’ factors firmly in mind, organizations are paying close attention to the ways in which green supply chains can limit operational risks and drive revenue generation.

Reducing Operational Risks With Sustainability

While no management practice or approach can eliminate risk, an emphasis on sustainability in the supply chain can help organizations better understand, monitor, evaluate, and address risks to avoid major problems and take advantage of promising opportunities. 

For example, Deloitte, a multinational financial services giant, explains in its article “Managing Risk Through Sustainable Supply Chains” that an agri-food company might find most suppliers of a particular commodity facing water scarcity in their primary supply basin. The company should at least work with these suppliers to develop risk mitigation strategies. It could also find alternative suppliers in regions without these issues or where drought patterns differ from those in the first region.

Driving Revenues Through Sustainable Practices

If you want to improve your organization’s financial bottom line, a few things can take you further than effective operational risk identification and management. However, this is only one among several different areas of supply chain operations that can benefit financially from green practices.

The Deloitte white paper “Sustainable Supply Chain Transformation” highlights how sustainability in supply chain and logistics can cut costs, streamline operations, and generate revenue. It details how these practices can create and sustain value and outlines new business opportunities, value propositions, distribution channels, and revenue streams.

Improving Supply Chain Sustainability

While the advantages of a sustainable supply chain are clear, the methods and tools required to achieve them can be puzzling and complex. To complicate matters further, some of these methods are mutually exclusive or inadvisable due to poor ROI. Read on for some advice on choosing and implementing effective, sustainable supply chain practices.

Strategies to Reduce Emissions in Transportation and Logistics

One of the best ways that a supply chain/logistics company can promote a healthier environment is by reducing the carbon emissions produced by vehicles during the ground delivery process. The trucking distribution experts at A Tech have identified “7 Ways to Lower Your Carbon Emissions in Trucking and Logistics”: reducing transportation distance, using low-emission vehicles, improving vehicle efficiency, adopting sustainable packaging, contracting with renewable power companies, employing emission-reducing data analytics, and establishing eco-friendly collaborations with both suppliers and customers.

Implementing Sustainable Procurement Policies

When it comes to partnering with suppliers, the B2B sustainability group Matcha Initiative presents a methodology that can make a real difference in the global ecosystem.

In its article “How to Write a Sustainable Procurement Policy,” Matcha guides organizations through the sustainable procurement policy implementation process by asking them to evaluate their current procurement policy, identify areas of green improvement, redesign purchasing processes with a dual focus on sustainability and ROI, and continually monitoring the effects of this redesign through the evaluation of key performance indicators (KPIs).

Investing in Renewable Energy Sources and Green Technology

For several organizations, KPIs clearly demonstrate the tremendous benefits of sustainable supply chain policies and practices in terms of environmental impacts and investment potential. While they may have substantial upfront costs, investing in renewable energy sources and green technology often pays dividends in the end.

Role of Sustainable Supplier Relationship Management

A wise supply chain/logistics manager will integrate sustainability concerns into a larger supplier relationship management (SRM) program that encompasses a whole spectrum of environmental, social, and governance (ESG) matters. As industry insiders, government agencies, and general consumers alike are holding organizations to stricter ethical standards, ESG issues have become an unavoidable aspect of positive public relations and ultimate marketplace success.

Increasing Transparency in Supplier Relationships

In “Managing Risk Through Sustainable Supply Chains,” Deloitte states that full transparency with suppliers is crucial for green supply chain management and broader ESG (environmental, social, governance) efforts. It questions what actions to take if a supplier’s behavior risks these goals, such as endangering operating licenses through irresponsible environmental practices. Any supply chain participant must ethically address such issues.

The Impact of Ethical Labor Practices on Sustainability

As calls for transparency uncover various ecological problems, they tend to shine a light on unethical labor practices as well. In fact, problematic environmental and labor practices often go hand in hand. Fortunately, increased transparency is making a difference in supply chain/logistics employer oversight. The business news outlet The Future of Commerce reports that 57 percent of today’s supply chain organizations are actively monitoring the labor conditions of suppliers.

Sustainable Supply Chain Education and Collaboration

Whether you are communicating upstream to suppliers or downstream to consumers, education and collaboration are essential components of most sustainable supply chain initiatives.

Promoting Sustainability Education Within the Supply Chain Field

The journal “Sustainable Development Goals in Tertiary Education for Sustainability” highlights the importance of teaching sustainability throughout the supply chain in the article “Experiential Learning for Sustainability in Supply Chain Management Education.” The article goes beyond viewing supply chains merely as product and service delivery networks from raw material to consumer. It suggests educational strategies to promote sustainable development in communities and their wider environments.

The Importance of Collaboration for Sustainable Practices

Individuals and organizations dedicated to sustainable practices can benefit from collaboration in various ways. Collaboration is incredibly valuable in all fields and industries as a prerequisite for the effective sharing of ideas and resources. However, the pace of development in the worlds of green processes and technology makes collaboration even more valuable in the field of supply chain/logistics.

Measuring and Reporting Environmental Performance

As previously mentioned in our brief discussion of using KPIs to evaluate green practices, measuring and reporting performance is key to any worthy sustainable supply chain initiative.

The Role of Data and Analytics in Supply Chain Sustainability

Their ability to accurately and comprehensively track and evaluate a variety of operational factors in real time makes data analysis and digital analytics indispensable supply chain sustainability tools.

Establishing and Achieving Sustainability Goals

The real-time insights supplied by data analytics and other forms of measurement and reporting can be invaluable. This is especially true when setting a strategic sustainability plan and reaching final sustainability objectives.

Community Support and Waste Reduction in Supply Chain Sustainability

Sustainability issues and goals vary widely from organization to organization. Yet, community support and waste reduction have emerged as key issues in the industry and marketplace today.

Looking Ahead: The Future of Supply Chain Sustainability

New challenges and solutions regularly emerge in the world of supply chain sustainability. Therefore, it is vital to stay abreast of the latest developments and ongoing trends shaping green supply chain practices today. The global sustainability association Businesses for Social Responsibility identified artificial intelligence, machine learning, and digital automation as key technological forces that promise to further sustainability in supply chain/logistics throughout 2025 and beyond.

Other supply chain/logistics trends to watch include increasing consumer demand for faster delivery options and the growing numbers of expatriates living in places outside their countries of origin. Ironically, climate change itself presents some of the most prevalent obstacles preventing the expansion of sustainable supply chain practices. For example, the widespread adoption of sustainable packaging is often hindered by ecological forces that limit the availability of necessary raw materials.

What Are the Long-Term Prospects for Careers in Sustainable Supply Chain?

As they continue to drive management innovation throughout the supply chain/logistics field, green practices are likely to shape the career trajectories of many for the foreseeable future. For this reason, among others, the job forecast for supply chain logisticians is exceptionally bright. With an expected occupational expansion of 18 percent through 2032, according to the U.S. Bureau of Labor Statistics (BLS), the pace of employment growth for logisticians is roughly six times the national average. The BLS also presents a relatively positive outlook for the earning potential of supply chain logisticians, reporting a median annual salary of roughly $78,000 per year.

Pursue a Sustainable Supply Chain Career

A quality supply chain industry training program like the one at North American Trade Schools (NATS) will stress sustainable practices as part of its curriculum. Get details at the official NATS Supply Chain and Logistics Operations program page and fill out the online form for more information. 

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Shipping and logistics experts list a lack of adequate supply chain visibility as one of the main reasons for the massive supply chain failures that occurred in the wake of the COVID-19 pandemic. While enhanced clarity tends to optimize all types of business operations, many people misunderstand the specific definition and benefits of visibility in the supply chain. 

Visibility is just one of many principles and topics covered as part of a comprehensive supply chain and logistics management program. A quality program, like the one offered at North American Trade Schools (NATS), will clearly demonstrate how the various areas of supply chain and logistics work together. 

What Is Supply Chain Visibility (SCV)?

Supply chain visibility (SCV) is the degree of transparency inherent in any set of supply chain systems, processes, and operations. A key defining characteristic of SCV is supply chain tracking (or supply chain traceability), which involves the ability to track individual items over the entire course of its supply chain journey. In some cases, this might mean tracing the journey of raw materials into a manufacturing plant as well as the journey of the finished products that exit it.

Importance of SCV and Traceability in Modern Businesses

As massive e-commerce retailers like Amazon now dominate the global consumer marketplace, shipping has become more prevalent for businesses at both domestic and international levels. As the sheer volume and practical complexity of shipments have increased over the years, companies have outsourced many components of their supply chains and sacrificed a great deal of their control over shipping and logistics operations.

This is why SCV and traceability have become particularly important supply chain and logistics issues in the 2020s. As supply chains become increasingly complex, the value inherent in SCV and traceability is only likely to grow for businesses of all types and sizes.

SCV is driven by modern technology that offers capabilities that would have been unimaginable for the supply chain and logistics professionals of yesterday. This technology employs artificial intelligence (AI) and other state-of-the-art tools to trace inventory in real time and provide a broad spectrum of operational insights.

Why Supply Chain Visibility Is Important in Customer Service

If you want satisfied customers, you must deliver products quickly and meet all other shipment expectations. To do this, you will need to order incoming supplies to meet demand and avoid shortages that might otherwise hinder production. You will also need to oversee the smooth and efficient movement of your products to the final consumer. In all these operations, you should take care to avoid impending shipment bottlenecks and meet all relevant compliance directives.

SCV can help supply chain and logistics professionals do all the above and more. Companies can use SCV tech to make supply chain changes to meet changing consumer demands. By tracing each movement of a particular shipping item, they can better respond to unforeseen supply chain challenges. Even better, they can offer customers access to real-time shipment tracking, which can make receiving shipments far more convenient.

How Can Real-Time Tracking Revolutionize Supply Chain Management?

From boosting logistics efficiency to improving customer service, real-time tracking is changing the face of supply chain operations in a variety of ways. The transparency real-time tracking offers can even aid in the development and maintenance of strong and productive supplier relationships. It has also proven to enhance the bottom business line by stabilizing business operations and producing bigger profit margins.

Here are just a few more ways that real-time supply chain tracking is revolutionizing the field of supply chain management:

Compliance with Regulations

One of the most fundamental hurdles you must clear to run a successful business is ensuring full compliance with all regulatory standards and guidelines that are relevant to your supply chain and logistics activities. Real-time tracking and other SCV measures boost transparency to support a broad spectrum of reporting functions.

Enhanced Risk Management

From its ability to foresee random supply bottlenecks to its ability to identify even momentary delays, real-time tracking enhances supply chain and logistics risk management on numerous different fronts. Additionally, AI systems can address many problems instantly and automatically after detecting them.

Accountability

Real-time tracking brings accountability to shipping that offers tremendous value to consumers. Up-to-date shipment traceability has led to more accurate arrival estimates and advancements in areas that range from inventory planning to resource optimization.

Improved Quality

All three of the real-time tracking benefits above lead to improved supply chain and logistics quality, which can boost customer satisfaction and lead to any number of competitive advantages. Other key SCV quality improvements include the ability to compare different transport routes with a focus on measuring discrepancies and altering planned routes to maximize efficiency.

Challenges in Implementing Real-Time Supply Chain Tracking

Although the advantages of real-time supply chain tracking are quite obvious, its implementation doesn’t come without its share of challenges. To better wrap our minds around these challenges, it may be helpful to break them down into three categories: technical, operational, and financial.

Technical Challenges

One of the best ways to sidestep the many technical challenges that go hand in hand with real-time tracking technology implementation is picking the right technology and the right vendor to install it. Keep your supply chain wants and needs in mind while searching for the right vendor—paying close attention to matters such as system customization, data security, and technical support capabilities.

Operational Challenges

Real-time tracking and other SCV measures have proven exceedingly effective solutions to common shipping and inventory problems in areas that include loading, unloading, transport, shelving, picking, and packing. Tailoring your system to address your chosen areas of focus can present significant obstacles during the implementation process.

Financial Challenges

There is no getting around the fact that implementing real-time tracking and other SCV measures comes with a substantial up-front price tag. Over a relatively brief period, however, these measures typically pay for themselves through the increased efficiencies that they engender. Given its proven ability to help anticipate and respond to supply chain disruptions, it can protect you against a supply chain catastrophe that might be just around the corner.

Overcoming Challenges in Real-Time Tracking Implementation

While the challenges to effective real-time supply chain tracking are quite real, you can address them immediately or stop them before they start by adhering to the following general guidelines:

Utilize Efficient Software Solutions

SCV software optimizes supply chain logistics by combining real-time tracking of shipments with automated operational and analytical processing to reduce delivery times, increase on-time deliveries, cut operating costs, and improve customer service. As stressed above, the best software solutions for you will depend on what you expect from SCV and the unique supply chain/logistics challenges you face.

Adopt Best Practices for Supply Chain Management

Modern technology can accomplish amazing things when it comes to managing effective supply chain and logistics operations. However, even the most advanced AI will fail to produce optimal results without the strategic guidance and oversight of skilled and knowledgeable human beings. 

One of the most crucial best practices of productive supply chain management is establishing a unified operational structure. Today’s supply chain manager must ensure smooth functionality among various business entities that often include outsourced, third-party service providers. With a productive network in place, the supply chain manager can establish standard operating procedures (SOP) to meet specific goals. Because the supply chain and logistics world is highly dynamic, wise managers will encourage ongoing feedback from all team members to better align SOP with goals over the long term.

Future Trends in SCV and Real-Time Tracking

As supply chain and logistics leaders look to the future of the industry, they see an increased focus on SCV. By combining the data from real-time tracking with data such as traffic patterns and weather conditions, SCV systems can effectively circumvent logistics issues and plan to avoid them altogether. Around the world, shippers are leveraging the power of real-time tracking to make more timely supply orders and enhance customer service.

Here are just a few other trends to consider regarding SCV and real-time tracking:

Integration With Other Technologies

Industry experts agree that real-time tracking works best when paired with AI, cloud storage, and other interrelated technologies. In fact, effective modern supply chain tracking demands integration with devices and equipment empowered by the Internet of Things (IoT). Using a system of sensors and codes, supply chain IoT allows physical equipment and inventory items to interact intelligently with one another to track movement in real time with full transparency.

Potential Industry Innovations

From cloud storage to IoT, tech leaders are constantly pioneering new hardware and software in different fields that relate to supply chain and logistics. Digital twinning is just one of many innovations in the field of AI. A virtual modeling of targeted physical assets using digital technology, twinning uses machine learning algorithms to better understand supply chain operations, conduct supply chain testing, monitor supply chain contingencies, and resolve supply chain problems.

Is Investing in Real-Time Tracking Worth It?

Assessing the ultimate value of real-time supply chain tracking is something that each organization will have to determine individually. But it is critical to note that you can make the integration of real-time tracking far more cost-effective by clearly defining your unique goals and making the services you choose to secure highly specific Many organizations discover that real-time tracking analytics greatly enhance supply chain operations by identifying areas for improvement, optimizing performance, and boosting financial and business growth.

Integration and Compatibility With Existing Systems

Supply chain and logistics professionals can significantly offset the upfront costs associated with an investment in real-time tracking by ensuring that their existing operational platforms and digital systems are ready for integration. This means evaluating technology to confirm or achieve compatibility with real-time tracking according to all essential performance benchmarks. You must also educate and prepare your team for the real-time tracking transformation by honestly communicating both its advantages and the challenges that its integration is likely to present.

Cost Considerations and ROI Analysis Factors

Though the hassles and headaches of real-time tracking integration may be difficult to quantify, you can effectively assess financial cost considerations using return on investment (ROI) calculations. A common investment appraisal calculation, ROI can help supply chain managers determine which, if any, real-time tracking measures to take.

Benefits of Pursuing a Supply Chain Management Program

Beyond matters related to SCV and real-time tracking, a good global supply chain and logistics management program, like the one at NATS, is an excellent way to prepare for a career in supply chain management or perfect your existing logistics operations.

Check out the Global Supply Chain and Logistics Management program from North American Trade Schools, then fill out the form today to request more information and see if this program is right for you!

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Supply chain and logistics educational programs must remain up to date on the latest industry trends if they want to prepare students for a successful career. Considering this imperative, they must also stress the benefits of technology in supply chain management.

Perhaps more than any other area of innovation, artificial intelligence (AI) is defining today’s rapidly evolving technological landscape. In particular, the global shipping and logistics sectors are leveraging the power of AI to both streamline and improve all kinds of processes. 

Read on to learn more about the place of artificial intelligence in supply chain operations. 

How Artificial Intelligence Transforms Logistics Operations

From market volatility to environmental concerns to unforeseeable natural catastrophes such as the COVID-19 pandemic, supply chains face more challenges today than ever before. While it is far from a cure-all, AI has stepped in to help supply chain and logistics professionals face and overcome these obstacles.

Gaining a Competitive Edge With AI in the Supply Chain

Companies that integrate the right AI can better track and manage incoming and outgoing inventory, but this is only the beginning of the competitive advantages that supply chain-related AI can deliver. By analyzing huge volumes of data in real time, AI can detect problems instantly, identify areas of improvement, automate routine tasks, understand causal relationships, and support better decision-making.

Enhancing Efficiency and Accuracy with AI

When it comes to delivering swift and precise results, AI is an absolute game changer in the supply chain and logistics field. AI systems owe their accuracy to built-in quality control systems that not only find anomalies but also correct them automatically.

AI-Driven Decision-Making in Supply Chain Management

AI has revolutionized global supply chain and logistics operations with its remarkable ability to analyze vast amounts of information—discovering patterns and making predictions. This innovation aids management professionals in mitigating risk, increasing quality, boosting productivity, improving customer satisfaction, and reducing costs.

Overcoming Challenges in the Implementation of AI in Supply Chains

While there are many profound benefits of integrating AI into supply chain operations, there are many challenges associated with its initial implementation. You must begin with a clearly articulated vision that includes several specific objectives. Next, take the time to thoroughly test all technology you plan to use and evaluate its various performance benchmarks. Finally, you must prepare your team for the AI transformation, touting its advantages while warning that its implementation will be likely to cause operational disruptions.

Addressing Data Quality and Infrastructure Issues

Accurate information is essential if you want to engender information-driven change. This holds true whether you are using AI tools or not. Because AI can only work with the initial data that you provide it, supply chain organizations must assess and prepare this data as a key part of the AI implementation process.

Selecting the Right Technology and Vendor for AI Adoption

Like quality providers of all types of goods and services, the best providers of AI tech will be able to demonstrate a proven track history of solution delivery. As a supply chain/logistics professional, you should seek out AI developers and vendors with industry-specific expertise. Other key selection criteria to consider include their dedication to data security, their system customization capabilities, and both their integration and post-integration support services.

Everyday Benefits of Incorporating AI into Supply Chains

AI-driven supply chains allow companies to boost their financial bottom line by cutting purchasing and production expenses. Beyond identifying and addressing costly problems, AI can greatly improve operational efficiency through automation. Additionally, its ability to accurately analyze massive amounts of information can help supply chain and logistics leaders make significantly better decisions.

Improved Forecasting and Demand Planning

In terms of decision-making assistance, it is hard to beat the extraordinary modeling and forecasting capabilities of AI. Put succinctly, AI can effectively predict the future when it is given the right data to work with. Through machine learning, AI can also inform itself to anticipate circumstances and proactively react to dangers in ways that human beings simply cannot. The most obvious benefit of AI forecasting and demand planning is preventing scenarios that lead to pronounced overstocking or running out of stock completely. Effective AI inventory management can structure timely and logical procurement and distribution procedures that lead to more productive relationships with suppliers and shippers.

Optimized Inventory Management With AI

Thanks to its amazing ability to monitor inventory and improve supply chain operations, AI can shorten delivery periods and better ensure on-time delivery. In addition, it benefits consumers by allowing them to receive updates and track shipments in real time. AI helps companies maintain optimum inventory levels and identify the most cost-effective ways to transport this inventory.

Preparing Your Supply Chain for AI Integration: A Step-by-Step Approach

After choosing the right AI tech and vendor, different supply chain professionals working for different organizations will want to tailor AI integration processes to meet their unique situations and goals. While there is no one-size-fits-all solution to effective AI integration, the following general steps are a great place to start.

Establishing Goals and Organizing Data

Because you cannot get where you want to go without a firm destination in mind, goal-setting should be the very first step in the AI implementation process. Because an AI system is only as good as the data it receives, data organization should be the second. Of course, you will want to keep your goals in mind when refining your data architecture, while simultaneously ensuring that it is organized for maximum compatibility with the right AI algorithms.

Selecting AI Technologies and Algorithms

As detailed above, company reputation, industry-specific expertise, data security, customization capabilities, and both integration and post-integration support services are all important things to consider when selecting AI technology to support your supply chain/logistics operations. You will also want to take a close look at each vendor’s technology stack and their various programming languages, frameworks, and algorithms to ensure full compatibility with your existing procedural and technical infrastructure.

Integrating AI With Current Systems and Testing

A quality vendor will guide supply chain and logistics professionals as they prepare for AI integration and launch AI capabilities. To avoid future headaches, thorough systems testing should play a major role in all these processes. Furthermore, AI systems should be programmed to engage in continuous testing to chart ongoing progress and evaluate new strategies. By learning from each set of test results and delivering relevant data to decision-makers, AI strives for constant improvement.

Unleashing the Full Potential of AI in Supply Chain Management

While it is evolving quite rapidly, most tech experts agree that AI technology is still in its infancy. Read on for a brief overview of AI’s massive potential and tips on how to benefit from it.

Future Predictions for AI in Supply Chain Operations

Experts see big things for AI in supply chain and logistics operations in 2024 and beyond. Buoyed by significant ongoing improvements in predictive analytics and demand forecasting, AI’s role in inventory management will expand. Similarly, improvements in intelligent automation will make supply chain and logistics processes more efficient and less costly than ever before. Experts also predict far greater interconnectivity among equipment, inventory, and professionals in every link of the supply chain than to technological advancements in the Internet of Things (IoT).

Making Your Supply Chain Future-Ready with AI

From helping organizations avoid shipping bottlenecks to providing consumers end-to-end supply chain visibility, the advantages that AI offers will become expected necessities as the ceaseless march of technology progresses. By adopting and implementing AI today, you can prepare yourself for uninterrupted success moving forward.

Practical Applications of AI in Supply Chain and Logistics

AI promises more effective, efficient, precise, and productive operations up and down the supply chain. But what exactly does this mean? Let’s take a closer look at just a few aspects of shipping and logistics that stand to benefit greatly from AI technology.

AI for Enhanced Warehouse Management

Warehouses rank among the top supply chain beneficiaries for technological advancements in the Internet of Things (IoT), as mentioned above. Driven by comprehensive AI systems, warehouse IoT involves the placement of sensors and readable codes on both physical equipment and inventory items to monitor environmental conditions, track movement, and provide real-time transparency for all operations. AI has proven effective at recording accurate warehouse inventory levels, too—reducing operational errors, increasing operational speed, and preventing operational waste.

AI in Streamlining the Loading Process 

Through advanced predictive planning and logical scheduling, AI can prevent shipping bottlenecks and generally make loading processes far more effective. Beyond these improvements, AI can transform loading processes entirely when paired with compatible material-handling robotic equipment. Driven by an AI “brain,” intelligent robotic units can go beyond loading and unloading to shelve, organize, pick, and pack specific inventory items, all while navigating environments autonomously and learning from their successes as well as their mistakes.

AI’s Role in Cost-Savings and Revenue Boosting

The added value that AI contributes in terms of both effectiveness and efficiency translates to an improved financial bottom line. According to independent business research by McKinsey & Company, 61% of manufacturing executives report decreased costs after integrating AI into supply chain operations. Likewise, 53% of manufacturing executives report increased revenues after AI integration.

Human Intervention in AI-Powered Supply Chains: Why It Matters

Although it has the potential to mimic human thought and instincts to a degree that is sometimes startling, AI is far from human in its inherent awareness. In terms of supply chain and logistics management, this means that it may misunderstand fundamental aspects of business operations that might be obvious to the ordinary person. As previously noted, AI systems are only as effective as the data that they receive. For these reasons and others, human intervention must be an essential component of any AI system, no matter how efficiently it runs and how quickly it learns on its own.

Will AI Replace Humans in the Supply Chain Industry?

It is certainly a powerful tool when placed in the right human hands, but AI won’t be replacing human beings in supply chain and logistics management anytime soon. The industry-changing effects of AI are vast and will impact employment in many ways, but human ingenuity will remain essential.

Learn More About AI as Part of Supply Chain and Logistics Operations

A good post-secondary educational program will not only deliver basic supply chain and logistics principles but also address AI and other modern advancements that are rapidly revolutionizing the field. 

The Global Supply Chain and Logistics Management program at North American Trade Schools (NATS) makes learning even easier by offering classes 100% online. Learn and request more information about this program with NATS today. 

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In the wake of the COVID-19 pandemic and other pronounced challenges to the global supply chain, newspapers have devoted many headlines to matters that relate to shipping networks and logistics. This publicity has generated increased interest from people seeking to solve these challenges by pursuing a supply chain and logistics management career.

Completing a specialized supply chain and logistics management program like the one at North American Trade Schools (NATS) is a great way to lay the foundation for professional success in this field. This program covers essential supply chain management principles that include basic inventory control.

Importance of Inventory Management

The finished products and goods that flow out of an organization and the raw materials and other operational necessities that flow into it, inventory is an essential business component. Inventory management is the strategic oversight of this inward and outward flow to track and record the movement of inventory and ensure that inventory is available where and when needed. At the highest levels, logistics leaders attempt to optimize inventory management in supply chain systems.

The Role of Inventory Management in Global Supply Chains

Supply chains of all sizes rely on effective inventory management to meet the demands of businesses and consumers alike. Beyond guiding the global flow of goods from production to consumption, inventory management is necessary to ensure that stock remains replenished and distribution meets demand. Inventory management also prevents missed opportunities, unnecessary expenses, and general waste associated with maintaining excess or insufficient stock levels.

Key Techniques of Inventory Management

To play the necessary role in daily business operations and global supply chains, inventory managers have developed various processes and techniques. Here are a few of the most successful and influential:

Just-In-Time Inventory Technique

Known by the acronym JIT in the supply chain and logistics sectors, the just-in-time method of inventory management concentrates on eliminating waste by keeping on-hand inventory levels as low as possible. Rather than stockpiling large numbers of products and large amounts of raw materials, a JIT inventory manager will order small shipments of stock to replace inventory as needed to fulfill current orders and meet forecasted demand.

ABC Inventory Management Technique

A hierarchical system of inventory management, ABC involves analyzing and evaluating inventory items to prioritize certain items for procurement and storage. It consists of placing items into one of three categories that measure the value against volume. The “A” category contains items that account for roughly 20% of overall stock but up to 80% of inventory value. The “B” category includes items that account for approximately 30% of overall stock but roughly 15% of inventory value. The “C” category contains items that account for around 50% of overall stock but only 5% or less of inventory value.

First In, First Out (FIFO) Technique

The first in, first out (FIFO) inventory technique stresses the importance of shipping out or exhausting stocks of older inventory before ordering or producing newer inventory. Extremely important when dealing with highly perishable goods, FIFO assumes that the first inventory acquired will be the first inventory used or sold. Beyond its emphasis on rapid turnover, the FIFO rule can help accurately estimate current inventory value and calculate the cost of final goods sold.

Exploring Different Types of Inventory Control Systems

Systems used to manage and control inventory commonly fall into one of two general categories: periodic or perpetual.

The Periodic Inventory System

“Periodic” inventory management systems evaluate inventory for financial reporting purposes by performing physical inventory counts at specific intervals (typically monthly, quarterly, annually or at the beginning or end of established fiscal quarters). This systematic approach is commonly used by small and mid-sized businesses that find it both easy to implement and cost-effective over the long term.

The Perpetual Inventory System

Rather than examining inventory periodically, the “perpetual” approach to inventory management continually tracks inventory changes in real time using digital technology. Perpetual inventory systems eliminate the need for physical inventory checks, offering minute-to-minute updates of inventory changes and constantly recording those changes. This immediate reporting system ensures that inventory managers know the precise inventory level.

Inventory Management Methods and Their Application

The specific techniques employed within periodic and perpetual systems can serve a range of valuable purposes for effective inventory management.

Periodic Inventory Management Method

A key metric in the practical application of periodic inventory management is the cost of goods sold (COGS), which is calculated by counting inventory at the beginning of a period and then making the appropriate inventory additions and deductions throughout the period that tallies with a final count at the end of the period.

Perpetual Inventory Management Method

A perpetual system updates accounts instantaneously by recording each acquisition, disposition, and sale to offer an up-to-date COGS at any time. Other advantages of the perpetual inventory system include analyzing transaction details in real time and investigating inventory-related errors.

Implementing Inventory Control Best Practices

To maintain smooth and profitable supply chain and logistics processes, you cannot underestimate the importance of following industry standards to optimize inventory control.

Management Methodologies Used in Inventory Control

In addition to just-in-time (JIT), ABC inventory, and first in, first out (FIFO) methodologies, inventory managers can employ any number of valuable methods to control the flow and level of inventory. For example, an inventory manager would want to stress materials requirement planning (MRP) to meet ongoing production needs and communicate effectively with suppliers in the manufacturing sector. Other helpful inventory control methodologies include economic order quantity (EOQ), which times and sizes inventory orders to minimize setup and holding costs. Days sales of inventory (DSI) is also helpful; it calculates the average time it takes a company to turn over its inventory.

Tips for Managing Stock Effectively

Beyond timing inventory orders and prioritizing inventory items, stock managers should regularly audit inventory using all the tools. The frequency of these audits will depend on the risk of irregularity between projected and actual inventory levels. A good stock manager will also closely monitor the operational efficiency of internal processes as well as the external processes of suppliers and distributors. And you certainly cannot discount the value of modern technology in stock management.

How Technology Aids Inventory Management

Like most areas of business operation, inventory management has been entirely transformed by digital technology. Its timesaving and cost-cutting results are incredibly well documented, and any inventory manager who isn’t using industry-specific computer software and hardware has surely fallen behind those who are!

Use of Barcodes in Inventory Management

Everyone knows the UPC barcodes that scan prices on household items for easy checkout at the supermarket or department store. Barcodes are incredibly useful for maintaining absolute accuracy and efficiency in shipping, receiving, and storage processes.

However, fewer people realize that supply chain and logistics professionals use similar barcodes to track inventory from initial production to final destination. 

Radio Frequency Identification (RFID) in Inventory Management

Radio frequency identification (RFID) accomplishes the same ends as barcoding but adds many desirable benefits. While the data on a barcode is “read-only” and cannot be changed, RFID data can be updated in real time, which supports far greater flexibility in the supply chain.

Furthermore, RFID scanners can process many codes simultaneously from various angles, unlike barcode scanners, which require a direct line of sight and must scan each code individually.

Understanding Supply Chain Inventory Control

Regardless of the tools used to accomplish it, effective inventory control is essential for any organization that wants to outpace its competition. Here are a few guidelines to help you optimize inventory control processes and operations.

Supply Chain Inventory Control Techniques

One of the essential techniques in inventory control is demand forecasting, which involves using existing data to predict future consumer demand and maintain the proper types and amounts of inventory an organization needs to meet that demand. To ensure this inventory is on hand at the right time, many inventory control professionals keep safety stock in storage to deal with unexpected demand surges and set reorder points to trigger communications with suppliers at specific inventory levels.

How to Optimize Your Supply Chain with Effective Inventory Control

While addressing general inventory control approaches like those described above, many inventory managers are adopting innovative supply chain and logistics models, many of which would be impractical, if not impossible, without the help of modern digital technology. Cross-docking and dropshipping are two models that can support highly effective inventory control. Cross-docking eliminates storage costs and hassle by receiving supplier inventory and shipping it to customers immediately. Dropshipping goes even further by keeping no inventory in stock and outsourcing all direct consumer shipping operations to a third-party supplier or logistics provider.

Inventory Control Policies and Process for Efficiency

Whether moving raw materials into your company or delivering products from your warehouse, practical and streamlined inventory control policies and processes are an absolute must.

What to Include in an Inventory Control SOP

By establishing clear, standardized operating procedures (SOP) for inventory control, an organization can ensure that every relevant team member will know what to do every time an inventory item is moved. A comprehensive SOP will cover the reception of goods and supplies, the storage of goods and supplies, and the shipment of finished products. It should also address scheduling and security matters related to these inventory-related activities.

Basic Control Policies to Improve Inventory Management

Beyond the general SOP guidelines detailed above, wise inventory control professionals will diligently track any losses arising from theft or damage. Fortunately, countless traditional and state-of-the-art tools help inventory managers precisely do this!

Exploring Software Solutions for Inventory Control

For centuries, business managers have used written ledgers to track and control inventory. Today, pen and paper have given way to computer hardware and software, which have proven to be highly capable of managing inventory automatically and with far greater speed and accuracy.

Features to Look for in Inventory Control Software

When choosing a digital platform to govern inventory management, you should emphasize its ability to forecast inventory needs and develop appropriate ordering and distribution schedules. Depending on your particular wants and needs, you may also require inventory control software compatible with barcode/RFID scanning, customizable configuration, and actionable inventory analysis features. You must also decide between software as a service (SaaS)/cloud-based systems (which are generally more affordable) and on-premise systems (which are generally more effectively targeted and managed).

Benefits of Using Inventory Control Software

A good digital inventory management system can lead to many competitive advantages by boosting the speed and accuracy of inventory tallies and calculations, saving you a great deal in terms of time, money, and headaches.

How Can Proper Inventory Management Techniques Enhance Supply Chain Efficiency?

By following this article’s guidelines and best practices, inventory managers can dramatically boost productivity and drive ongoing improvements in global supply chain and logistics operations.

Global Supply Chain & Logistics – A Field of Growing Importance

Beyond essential inventory control, the supply chain and logistics profession is rising to meet increasing daily challenges. If you want to be a part of the solution to the many shipment problems plaguing the global supply chain, you owe it to yourself to check out the Global Supply Chain & Logistics Management Program at NATS. For more information, fill out the short digital contact form at the top of the page.

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The supply chain is an advanced and interconnected network that begins with raw materials and ends with a finished product that can be purchased by consumers. Defined as a chain due to the numerous links in the system, the supply chain is an interconnected entity that must flow seamlessly to reduce costs, expedite production times and improve customer satisfaction ratings.

As a result, the demand for trained and qualified supply chain managers is on the rise — with organizations particularly focused on finding professionals with an advanced understanding of global logistics and supply chain management.

If you are looking to pursue a career in this fast-paced, evolving field, you may want to consider enrolling in an online supply chain management course or global supply chain management degree program.

Uncovering the World of Global Logistics and Supply Chain Management

Global logistics and supply chain management are separate fields that are closely related. In logistics, professionals are focused on efficiently managing goods and services, with their primary goal being to preserve product quality and expedite processing times. On the other hand, supply chain management is the network that begins with raw materials and works toward production, manufacturing and distribution, ultimately ensuring that products reach consumers in a fast and affordable way.

While there are distinct differences, it’s clear that the two fields must work in tandem to ensure consumers can readily purchase the high-quality products they crave. It’s the only way the global economy can continue to move forward.

What Is Global Supply Chain Management?

Global supply chain management refers to the optimization of the supply chain on a global scale. While there are individual supply chains within local communities and countries, there’s also a larger, much more complex supply chain that exists on a global scale. Understanding the links of the global supply chain and knowing how to manage them effectively is critical to preserving the health and strength of the global economy.

According to ProLogis, global supply chain management is one of the most pivotal disciplines of 21st-century business, with the success of both small and local businesses and large corporations depending upon an effective and efficient global supply chain.

The Role of a Global Supply Chain Manager

Global supply chain managers are specialized business professionals who focus on developing and implementing advanced supply chain strategies on an international scale.

According to Zippia, the responsibilities of a global supply chain manager include:

• Securing materials from the leading suppliers around the world and negotiating the best possible price.
• Managing inventory.
• Verifying that all suppliers are complying with safety standards and local regulations.
• Collecting supply chain data and evaluating performance.
• Identifying inefficiencies within the supply chain and addressing them.
• Ensuring all products meet or exceed quality standards.

What to Expect From a Supply Chain Management Course

A digital education in supply chain is possible thanks to the availability of online global supply chain and logistics management programs. Whether you have already earned a degree in supply chain management or are enrolling in a certification program to specialize within your field, an online learning program can help you advance your career in supply chain and logistics.

E-learning for supply chain professionals can be completed on your own time, allowing you to effectively balance your existing priorities with professional development. Including both synchronous and asynchronous components, you are sure to enjoy a well-rounded and engaging experience that allows you to develop and improve practical skills in logistics.

Topics

The topics covered as part of your online global logistics and supply chain management program may vary, but some topics commonly discussed include:

• The current trends shaping the global supply chain.
• Best global supply chain practices.
• The basics of logistics management.
• Inventory control techniques.
• Advanced logistics and distribution management.
• Competitive globalization and its impact on the supply chain.
• Supply chain risks.
• The most influential stakeholders in the global supply chain.

An online logistics training program will provide you with in-depth, expert-level knowledge of global logistics and supply chain management while building your practical logistics skills. It’s an ideal professional development opportunity for anyone who wants to specialize in supply chain management.

Skill Development

Skill development is a key component of any online certification course or online degree program. Your supply chain management course curriculum will likely emphasize the following practical logistics skills:

• Data harvesting
• Data analysis
• Supply chain and global logistics technology
• Project management
• Communication
• Collaboration

This combination of hard and soft skills should help you feel confident and ready to dive into your role within the global logistics and supply chain management sector.

Required Coursework

Coursework that is required to complete an online certification may include:

• Video lectures and slideshow presentations.
• Collaborative projects with classmates that can be completed virtually.
• Studying from textbooks and other online course materials.
• Data collection and analysis to develop practical logistics skills.

Students who opt into online learning programs appreciate that they can balance their required coursework with existing responsibilities. Online learning in logistics is considered incredibly accessible, and a viable option for anyone looking to specialize or advance their career in supply chain management.

Benefits of Earning a Global Supply Chain Management Degree

You may enjoy both professional and personal benefits when you invest your time and resources into a global supply chain management degree. According to Indeed, the top benefits of this online degree program include:

• Experienced supply chain managers are in high demand. According to the Government of Canada’s Job Bank, the number of job opportunities in the field is expected to increase by more than 8,100 positions by 2031. Your location, however, may determine what positions are available to you. Supply chain managers are expected to be in high demand in places like Alberta, Nova Scotia and Ontario.
• The industry is expected to grow and expand worldwide, particularly as the global economy continues to strengthen and become more interconnected. Experienced supply chain managers who understand more than just the basics of logistics management will be able to pursue job opportunities in Canada and beyond.
• Supply chain managers and logistics professionals can network with business leaders in a wide variety of sectors and industries. Networking in the supply chain industry includes more than just other supply chain managers, as you are often in contact with marketing professionals, suppliers, vendors and production experts.

Prioritize Your Career at NATS

The Global Supply Chain and Logistics Management Online program at North American Trade Schools is designed to help students find success in the global field of logistics, supply chain and operations management. Gain real-world competencies and skills while learning about new and emerging technologies impacting the global supply chain. You’ll also have the option to prepare and sit for the Canadian International Freight Forwarders Association (CIFFA) certification and the Lean Six Sigma Yellow Belt certification. Contact us today to learn more.

Are you interested in supply chain logistics courses?

Contact NATS for more information.

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