In supply chain planning, for example, imagine a critical milestone scheduled for June. Typically, teams backtrack from that date to identify key information inputs and decisions needed as early as January or March.

While project management tools provide scheduling functions based on specific dates, the reality is: if these date-based schedules do not evolve into sustained operating frameworks, they are often forgotten and inconsistently reapplied across projects. For instance, a November product launch may backtrack key readiness activities to June, yet without a framework, cross-functional groups may still trigger work too late, risking the milestone. Although organizations conceptually understand time, dates, and durations, we consistently observe a low appreciation of lead times across corporate functions.

The practical evidence is unfortunately clear: teams frequently encounter tight, stressful timelines because the triggers to initiate work were delayed, not because the execution was poor, but because the framework for timely activation was missing.

This lead us to a critical insight: tight timelines often stem from the absence of a standardized timeline framework with predictable, cross-functionally understood triggers as shown in Figure 1 below.

Figure 1: a “T minus” framework mapped to Day 0 (go-live) and aligned with Project Specific Dates. 

Triggers for starting critical activities depend heavily on information availability. However, it is not merely whether information is available — it is whether the certainty of that information is sufficient at the right time. 

Figure 2 illustrates that if a team needs two months to react effectively (Point A), then if information is available only two weeks (Point B) before the milestone, it is inadequate regardless of its accuracy. Thus, the issue is not perfection of information, but sufficiency of reaction time. Information must be shared early enough to allow for necessary actions, even if that information is imperfect. While the tension between accuracy and timing is an age-old challenge without a definitive solution, organizations can significantly mitigate risks by raising awareness and intentionally designing standard frameworks around timing needs. 

To build organizational resilience and predictability, companies must establish timeline guidelines, particularly for high-impact projects like product launches and regulatory filings. These guidelines form the operational backbone for timely execution across functions. One proven structure is the “T minus” framework. In this model, Day 0 represents the go-live date. Activities are scheduled against relative time markers: for instance, T-30 (30 days before), T-60 (60 days before), and so on. This framework detaches planning from calendar-specific dates and shifts the focus to lead times and necessary durations, creating organizational consistency. Refer to Figure 1 again to visualize the “T-minus” mapping.

Instead of saying “Have marketing materials ready by September 15,” the framework would state, “Marketing materials must be ready by T-30,” whatever the launch date is. This reduces confusion across projects and builds repeatable execution muscle. Of course, you will need the September date for project specific alignment, but organizational understanding of the activity as a T-30 day activity enables repeatability and consistency of understanding across projects.

In other words, The T-minus framework does not eliminate the need for project-specific scheduling tools, but it provides a reusable reference architecture that dramatically improves timing predictability. A simple timeline table or Gantt chart structured around T-minus milestones can further clarify deliverable expectations.

Establishing a T-minus timeline framework and embedding it within functional playbooks ensures that the understanding of lead times and critical triggers becomes part of the organization’s operating system, not dependent on individual memory or ad hoc planning. Functional Playbooks should map activities to lead time structures: what must happen at T-120, T-90, T-60, T-30, etc. This approach creates clarity and accountability. Cross-functional launch teams using such Standards and Playbooks at major pharma companies have achieved significant acceleration and/or stayed on timeline despite risks and set backs.

By building these frameworks and playbooks into standard operating practice, organizations can move from reactive firefighting to proactive, scalable execution, while driving better outcomes across product development, supply chain, and regulatory functions. Just like in many other environments, Standards need to be established for the timing and accuracy (or lack thereof) in information sharing. A cross-functional understanding of these standards (i.e. expectations) enables on-time delivery of projects and can even accelerate results.

Wish to discuss more about Advanced Project Management Practices and Playbooks? Schedule a quick connect with Marcos Buelvas here.

Author – Marcos Buelvas, Managing Director, ScaleUp Inc

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In the world of bringing a pharmaceutical product to market, supply chains play a vital and multifaceted role, ensuring the seamless flow of materials, timely delivery of products, and adherence to regulatory requirements across complex global networks. A McKinsey study states, “…On-time delivery generally is not a problem. On-time, in-full (OTIF) fulfillment levels are 97 percent. Clinical drug supply professionals corroborated these findings, as they focus primarily on not missing doses…On the other hand, waste levels for investigational medicinal product (IMP) kits reached a concerning 50 percent, driven primarily by poor forecasting and planning—highlighting a significant opportunity to capture value.” (mckinsey.com).

Just like a Commercial Supply Chain, a Clinical Supply Chain has multiple interconnected nodes and inherent complexity at a global level from the moment the first patient is enrolled. Naturally, the volume of product requirements is relatively low, so the Supply Chain is not yet experiencing high-volume operational constraints and intensive resource requirements. Nevertheless, a continuum of capability building should be present. The reason is simple: there are already escalating costs and potential risks that must be proactively anticipated and mitigated. 

Figure 1 below illustrates the relationship between complexity and time for two variables: The technical readiness of the product itself, as well as its manufacturing, and Supply Chain Maturity. It highlights the interplay between product development and supply chain scalability, emphasizing the challenges and transitions leading to commercial readiness. 

Figure 1. Clinical Supply Chain Complexity vs. Technical and Clinical Uncertainty

The point of the illustration in this figure is to simply acknowledge an evolving landscape across the domains of technical development, clinical uncertainty, and the supply chain’s increasing complexity over time. In many respects, technical and clinical complexity are also increasing, so this is not to suggest otherwise. However, for clinical supply chain purposes, over time, more unknowns are becoming at least directionally better understood and more easily shared by the clinical and technical development groups. For the supply chain, this makes the biggest difference as they are now receiving more robust input to make decisions and establish operational capabilities.

Let’s decompose the Clinical Supply Chain into its parts, see Figure 2 below.

Figure 2. Primary nodes in the End-to-End Clinical Supply Chain

While the 4th segment of the Supply Chain in Figure 2 above is the most visible and widely appreciated outside of the CMC function, a great deal of the supply chain risk lies in nodes 1-3. Commonly, there is a management separation from a Supply Chain point of view at node 3. In other words, nodes 1-3 are managed under one Supply Chain governance, while node 4 is managed under another.

This division makes sense from a workload perspective, but it does create two domains of competency that are not always fully in sync. Let’s discuss improved alignment across these segments.

Achieving Better Clinical & Operations Alignment

An often overlooked, but impactful governance mechanism that can be used to maintain alignment across these functions is a Clinical & Operations Planning (C&OP) process. Typically used for Clinical and CMC alignment, this process actually supports alignment within CMC and outside of it. The key is that cross-functional participation and learning about each function’s key drivers enables streamlined integration of the ever-evolving plans. 

The reality is that Clinical Supply Chain sits in-between to highly variable environments; i.e. CMC development and its inherent variability and clinical operations and its equally variable nature. The position and effective role of the Clinical Supply Chain is illustrated in Figure 3 below. 

Figure 3. Clinical Supply Chain as the link between two evolving functions in the development and clinical trial phases

The role of the Clinical Supply Chain is, therefore, to smooth both sides, de-risk critical connection points, and sustain a stable supply to Clinical Operations. These particular processes closely mirror those linking complex Commercial Supply Chains, offering an opportunity to build capabilities by leveraging ‘light’ Commercial Supply Chain tools and methodologies. These may include Supply Chain Management dashboards, forecast accuracy measurement, performance-to-plan tracking, and others. All of these being core elements of a well functioning C&OP process.

Following this ‘light’ tools approach can significantly enhance a teams’ readiness to support growth, establish risk management processes, and develop future capabilities.

A great example of establishing and operating on-going alignment through C&OP is the Clinical Supply Chain function clearly articulating its information and timing requirements on a recurring basis and through the formal forum of C&OP. A simple diagram of these parts coming together is illustrated in figure 4 below.

Figure 4. The simple elements that are core to a successful C&OP

The formal forum is needed because the clinical supply chain function has to do this in both the CMC and Clin Ops directions since the information needs are to align both.

The processes are ongoing, but there are critical information elements that have critical timing implications. Many of these information elements seem simple to the originator of the information (CMC or Clinical Ops) but they are critical to the clinical supply chain. Things like expected yield, timing of output, and target quantity. From Clin Ops, these may include expected first patient in, dose, and number of patients.

There is always hesitation to provide some of this information given the uncertainty in the processes, and again, this is the case with both CMC and Clinical Ops. This is understandable, but a good rule of thumb is that it may take 12 months for a supply chain to produce and make a product available. While this number can vary, it is helpful to think in this order of magnitude since it is indeed a long time to get a product from beginning to end.

In the world of the Clinical Supply Chain and given these long timeframes, an uncertain number is better than a more accurate one too late in the process. For examples like this, C&OP as a consolidated forum is indeed the best practice as a formal governance process to enable optimized alignment across clinical and supply chain operations.

Wish to discuss more about this subject and how ScaleUp Inc can help you with Clinical & Operations Planning (C&OP) in Clinical Supply Chains? Schedule a quick connect with Marcos Buelvas here.

Author – Marcos Buelvas, Managing Director, ScaleUp Inc

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Despite the criticality of the answer to these questions, that information is not at the fingertips of executives, leaders and personnel. Needless to say, this should not be the case.

The problem is not exclusive to large pharmaceutical companies with multiple business units and thousands of SKUs; it also shows up in clinical-stage, pre-commercial companies, and companies about to launch products. The challenge manifests very differently of course, if we are talking about a large company vs. a small one, and everything in-between. The drivers differ, and so does the decision-making process. 

However, there is hope. This is not a complicated process, but it does require some doggedness and attention. This is best described with an example, so let us look at small biotechs. These teams are mostly under-resourced and uber-busy fighting fires. What falls to the wayside is time to think through where and how to start attacking the problem of building capability, process and tools that are cost-effective, easy to use, and implement. They often give up before simple barriers simply because they don’t have someone to turn-to (e.g., an excel formula, a template for suppliers, emails and quick working sessions to round people up).

4 easy steps to address the problem

Let’s start by breaking down the process:

1. Obtain inventory status from each supply chain node at the end of the month
2. Aggregate key inventory data elements into a data repository
3. Link data repository with a reporting engine (e.g. PowerBI, Tableau, Excel)
4. Establish a recurring review and inventory adjustment process

Believe it or not, what will determine the success of this process is step 4, and by the way, that step can be as short as 30 min/month once you get it IN CONTROL. This is absolutely critical because the superb principle at work here is the one popularized by Lean-Six-Sigma about shining a light on something. You shine a light on this, and it will run. The prior 3 steps are also quite easy to run once implemented.

For Step3, the reporting/analytical engine provides robust insights using tactical visualizations and using the right reports makes a world of difference in how pain points are identified and how teams drive decision making.

Here is an example of a simple visualization technique that can substantially impact operational teams and execution.

The above chart, while simple, is a horizon view of expiry across a product portfolio and supply chain nodes. This will enable your personnel enough time to react Vs the alternative of learning expiries within 1-2 months of when it happens. Even small companies can manage and produce this type of insight very easily with expert support. It makes a huge difference to visualize expiries across the horizon Vs present it on a simple list. 

What if the inventory review process is not followed?

This process is not running consistently in a large percentage of companies. Given the simplicity of this, why is it not running everywhere?  As I said earlier, it is not running consistently because of simple things that teams just can’t get passed. I apologize for repeating myself here, but it can be an excel formula, a template for suppliers, the emails and quick working sessions to round people up.

Another powerful angle to doing something in this area is the support you will get from your Finance department. In my opinion, they should be the first to get in your corner. They will definitely support what you may need to get this process up and running. Their lives will be that much easier and the confidence in where the business stands in this critical dimension will substantially improve.

There are some infamous examples of the staggering cost of failure in this department, and I am sure some of these will resonate, but I can only highlight a few because there are too many scenarios to cover.

• Near-term product expiry at clinics leaving no time to react (e.g., next month)
• Short supply of bulk material to run the next batch and development requirements
• Not enough inventory reserved for a specific batch for a particular study
• Not enough components (e.g., vials, syringes) to perform the last step of the process

The implication of any of these scenarios can derail a program, a launch or commercial operations and ultimately impact patients. The fix is simple and may only require a little nudging from a concerned executive or leader. Get ahead of this one; inventory is like cash…you really don’t want to run out of it.

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What is supply chain agility?

In supply chain management, agility means being able to plan, respond, and monitor promptly in case of unexpected events. It means to instantly change the direction when required to rationalize SKUs, shorten planning cycles, and shift production lines.

The goal is to maintain a fluid, responsive, and informed supply chain that can easily navigate changes that may come its way- whether good or bad.

Successful supply chain agility depends on the following-

• Understanding the external factors that shape supply chain logistics, irrespective of how steady things are now.
• Integration of process workflows and more proactive technology to address the pain points in the value chain.
• Exploration of components of the value chain that are most affected by industry disruption.
• Ongoing analysis and monitoring of new processes, production cost savings, and cross-functional collaboration, continuing to tweak practices if required.

Dimensions of an agile supply chain

Alertness/Awareness

Organizations that are alert can forecast changes in the industry, competitor threats, growth opportunities, and upcoming disruptions. The more aware organizations are, the quicker they can respond to changes in demand and supply trends.

Accessibility

Companies cannot incorporate changes without access to information and tools. Alert businesses have access to specific industry data in relevant history logs that all stakeholders can easily analyze and share.

Decisiveness

If organizations are decisive, they can clearly and quickly translate any industry change in the accompanying information into action. The most decisive organizations have easy and unified change-of-command to lessen the number of points of contact required to make a quick decision.

Swiftness

Swift organizations implement their plans quickly. More quickly the changes are made, more cost-effective the entire supply chain becomes and this is profitable for businesses. 

Adaptability

Agile businesses have the power and the buy-in to modify the ongoing processes when new opportunities come. This can be done without disrupting the entire business. Those capable of adaptability understand that action plans can change anytime, even when they are commenced under a smooth data-backed cycle that fits a value chain need at the time.

Ways to increase supply chain agility

Use real-time data

Maintaining real-time inventory levels is crucial to success as it provides more visibility into operations that can help companies in making informed decisions and can be proactive in implementing changes across the supply chain. For instance, the ability to view, track, and manage inventory levels across the supply chain in real-time can give a business insight into how to optimize inventory to keep costs low as well as meet demand.

Spilt the inventory

Although the primary benefit of splitting the inventory across several fulfillment locations allows businesses to expand their consumer reach geographically, a secondary distribution center can help to avoid long fulfillment delays and can help businesses to continue to meet consumer expectations even if a warehouse has to shut down due to any unexpected event. Strategic inventory management principles help to plan this crucial element and makes the supply chain more agile.

Implement demand forecasting

By implementing demand forecasting tools, companies can anticipate demand fluctuations based on the past, patterns, and seasonality. Appropriate demand forecasting can help organizations to maintain healthy stock levels at all times, plan for flash sales and promotions to be done in future, and make sure that they have enough inventory for the busy holiday/festive season.

Set Stock Keeping Units (SKU) reorder points

To avoid delays and stock-outs, companies can use past sales data and inventory to determine when it is time to reorder inventory at the stock keeping unit level so that inventory can be restocked at the right time.  

Companies can also take into consideration future growth to understand how many units of SKU should be ordered. Many inventory management solutions are available in the market that can help in pulling up the data which is required by a business to determine an optimal reorder point. These solutions also include an automatic notification feature that can notify when inventories are running low.

Investing in warehouse technology (Warehouse Management System/WMS)

As businesses expand their supply chains, they will need to store inventory in several warehouses, which can be challenging and complex. To overcome this, companies need to have technology in place that controls and monitors daily operations within the warehouse.

Warehouse technology and automation will help businesses to ensure that inventory is received, picked, stored, packed, shipped, and replenished efficiently. Besides that, the right WMS also has the potential to improve consumer satisfaction.

Final Word

The COVID-19 pandemic has brought about the importance of supply chain agility even more than before. With the sudden scarcity of raw materials to changes in demand, stock-outs to shipping carriers being stretched beyond capacity, the world has seen it all. Therefore, it has become essential for businesses to increase their supply chain agility to thrive in such constantly changing scenarios while maintaining profitability.

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What is Material Requirement Planning (MRP)?

MRP is a standard supply planning process that helps businesses, predominantly product-based manufacturers, understand inventory requirements while balancing demand and supply. Businesses use Material Requirement Planning, a subset of supply chain management systems, to resourcefully manage inventory, schedule production and deliver the right products at optimal cost and on time.

Why is MRP important?

MRP helps businesses to know the requirement of inventory to meet the demand, optimize their inventory levels and production schedules. Without these insights, businesses have limited responsiveness and visibility which can result in-

• Ordering inventory in excess can increase the carrying costs and blocks up capital in inventory overhead that could have been used somewhere else.
• Failure to meet demand due to insufficient raw materials resulting in loss of sales, out-of-stocks, and canceled contracts.
• Delayed sub-assembly builds that result in decreased output and increased production cost, disruptions in the production cycle.

Thus, MRP is relevant in many industries from Life Sciences to CPG to create a balance between demand and supply.

How to get MRP right?

Ensure Data Accuracy

It is crucial to understand the validity of data inputs because if not done then MRP efforts get compromised because of poor quality data. Therefore, for MRP to generate accurate reports is to input accurate inventory information from the beginning.

Use Forecasting

Most MRP systems take into account open sales orders or forecasts to calculate demand. Forecasts can be production or sales forecast, either way, MRP uses this information to generate material requirements. The advantages are twofold; the first being businesses can approximate their material requirements further out than the time fence that applies to the sales orders. Second, besides material planning, it will not only help in a production scheduling standpoint but will also aid in the staffing requirements.

Better management of raw materials

For operations to stay on track, businesses need to manage raw materials properly. Excess of raw materials especially when they are perishable items or have limited shelf life can lead to waste and cost overruns.

MRP helps in identifying which raw materials will be in excess and how accurate orders can be created while eliminating waste.

Stay up-to-date

MRP is driven by the required dates of the expected demand. When it comes to open sales orders, open purchase orders or even open production orders staying up to date is a must. If not, MRP will indicate to order materials well in advance of when you actually need them to meet the immediate demand of past-due sales orders.

Monitoring Vendor Performance

Changing vendors is not easy, but monitoring their performance should be a core business practice. Conducting frequent audits and reviews of historical transactions between vendors is important. This is required to check how they are in terms of anticipated lead time vs. the actual lead time. Based on this information MRP can be improved quickly.

Understanding operations capacity

Understanding the various production constraints of the work centers of your business is a must. MRP should be able to create an anticipated production schedule based on factors like present supply and forecasted demand, and employees scheduled. However, it is also important that capacity and space is also taken into account. Manufacturing more inventory that can’t be shipped or stored is not an ideal scenario for most businesses.

Optimizing MRP is the key to running businesses efficiently

MRP systems enable businesses to plan and schedule production efficiently. It ensures that that materials move through the work order quickly and customer orders are fulfilled on time. An MRP system that is integrated across an organization not only eliminates manual processes but businesses have to spend less time on building production flows to understand when and where product availability is required.

However, just like any other Supply Chain process, MRP is as good as the data which is put into it. Therefore, the better the business understands and documents its processes, the better Material Requirement Planning system can serve them. Inputting correct inventory availability, subassembly completion time, lead-time from vendors, and waste calculations is a must. Businesses must run a robust MRP to achieve substantial operational and profitability gains.

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Global supply chain crisis in 2021 and the solutions for 2022

After the pandemic, the supply chain crisis had been the biggest story in the year gone by and the COVID induced lockdowns of 2020 fueled the crisis. Many supply chain challenges such as mismanaged inventory, aging shipping fleet, and the lack of accurate data had already been there for years but the coronavirus pandemic aggravated these issues further.

What happened in 2021?

COVID was just one part of the problem, the real-world supply chain workflows became global before the tools and platforms to manage said workflows were sufficiently available. The supply chains were designed for the lowest cost and efficiency but not resilience.

Furthermore, the business and economic environment became more challenging. For instance, in the UK and the rest of Europe due to Brexit led to supply chain pressures causing increase in red tape and cross-border checks. Broadly, the firms continue to grapple with a range of international business challenges ranging from building global management teams to fluctuating international exchange rates.

Besides that, the environmental impact of logistics and supply chain activities is now being understood more widely. So if the countries across the globe have to meet their commitments and emission targets they need to develop more sustainable supply chain practices.

Fixing the supply chain issues in 2022

It seems that the supply chain crisis is not going away, the port slowdowns are likely to persist as the new virus variants have led to strict monitoring, testing, and quarantine protocols at ports. This will lead to extended delays. Additionally, the work from home trend may continue longer and that can lead to a shortage in labor supply. Besides that, the semiconductor shortage will continue this year. Demand for goods that use chips will remain high and due to lead time to build new semiconductor factories, there will be a demand and supply gap in 2022, according to a Forbes report.

Considering the above facts, here are a few solutions that can help businesses to fix their supply chain challenges in 2022.

Switching to a de-globalized supply chain

Due to the ongoing disruptions, countries across the globe are trying to become less dependent on the notion that they should manufacture goods in countries with the lowest labor costs and ship them quickly to consumers.

Businesses are now looking to move to de-globalized or resilient supply chains. This means bringing back some manufacturing nearshore and alternate sites with flexibility to alter production lines and supply chains based on demand.

Investing in technologies to improve supply chain resilience

To boost productivity, companies are increasingly investing in new technologies. According to IDC, in a few years, companies will adopt technology that will reduce supply chain bottlenecks by 10%. Businesses will also invest in services and software that enhances productivity and use AI to do more with fewer workers.

With frameworks like robotics as a service and technology as a service, smaller companies can also benefit from supply chain automation and compete with larger enterprises. Significant innovation and seismic operational changes will hold the key to the future of supply chains.

Boost pay and increase opportunities for workers to improve productivity 

Given the difficulty of hiring workers and retaining them, businesses must look at boosting their pay and increasing opportunities for them to develop new skills and gain knowledge about the business.

Investing in people will support the work environment that will align with the company’s mission with the career goals of the workers. By retaining employees and boosting their skills, business operations will become more productive.

In conclusion

The pandemic has given businesses a chance to reinvent their supply chains. The focus is on building dynamic organizations that are flexible in operations and highly resilient to global disruptions.

Businesses have to be resilient and capable of adapting to major disruptions so that they can develop long-term solutions and strategies to complex challenges. Adoption of innovative and sustainable practices will be the key to fixing supply chain challenges in 2022 and beyond.

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Every project undertaken in a business has a unique set of risks, therefore when project managers carry out a risk assessment and identify potential threats, a proactive backup plan needs to come into place.

What is contingency planning?

A contingency plan in project management is a defined, actionable plan that comes into force if an identified risk becomes a reality. No one wants their ‘Plan A’ to fail but it is essential to keep a ‘Plan B’ in place when things go differently than the original flow. However, businesses must have an effective contingency plan in place that can address any negative development and ensure business continuity.

Contingency planning is an essential part of effective supply chain management and the overall risk management of your business. By understanding the business needs, implementing a few best practices, and investing in the right tools, businesses can guard against both short and long-term disruptions, improve disaster recovery capabilities and risk mitigation, and safeguard business continuity when it matters the most.

Must-haves for a contingency plan

Effective contingency planning in project management is all about protecting your project resources and helping your business operations move forward during any unforeseen event.

Therefore, when preparing a contingency plan following elements should be taken into consideration

• Pinpoint what specific event or events can trigger the implementation of Plan B.
• In each step of your plan cover- who will be involved, what do they have to do, when it needs to happen, where will it take place, and how will it be executed.
• Ensure that there are clear guidelines for communication and reporting during the implementation of the plan- who will draft and send the notice, and how soon after the incident will it be released? How often updates will be given? How will external and internak stakeholders be notified?
• Regular monitoring of the plan should be done to ensure it is up-to-date.            

How to prepare an effective contingency plan?

If businesses don’t want to get caught off guard if any unforeseen event disrupts the initial project plans then it is essential to prepare an effective contingency plan.

Risk assessment

Identify the most likely potential threats that a project could face. The project manager should do risk assessment by brainstorming issues with his team that might disrupt the project. Once all the issues are identified, establish which of the identified issues are the likeliest to happen and would have the biggest impact on the team’s ability to complete the project. These are the situations that call for contingency planning.

Risk quantification

Once the risks have been identified, the next step is to quantify them to determine which risks would be the most detrimental to the project if they happen. The project manager with his team need to determine the probability of a risk occurring and its severity if it were to occur. The severity impact can be quantified as low, medium, and high.

Identify and ensure that resources are available to respond to specific scenarios

For a contingency plan to be effective, a project manager should ensure that resources are available to respond to the identified and quantified risks if they happen. Taking inventory of the people in the team, comparing their abilities to the one’s that may be required to handle a problem and returning to normal operations is a must.

Project managers should also develop plans and procedures to utilize those resources in specific events. For instance, if one worker is unable to work, which other team member will pick up the slack and what specific task he/she will have to do?

Share the plan with all stakeholders

A contingency plan should be shared with all stakeholders so that they are not only prepared for any contingency but the project team can also benefit from their suggestions. Different members of the team or organization may have expertise in areas that could help make ‘Plan B’ effective if it is to be put in place.

Take feedback and update regularly

Look for any opportunity to update the contingency plan. Having regular updates with team members is essential to see if any improvements can be made.

Conclusion

Depending upon the scope of the project, the planning process can require a huge amount of precision and forethought. Having a contingency plan just in case the original plan fails can be the difference between keeping the project on track and letting it fall apart when an unforeseen event happens.

The bottom line is that risks cannot be eliminated in project management, and having effective contingency planning is the last line of defense against the risk.

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What is network planning in supply chain management?

Supply chain network planning is the process of modelling and building the supply chain to understand the time and costs to bring the goods and services to market within the available resources of the organization.

Effective supply chain network planning can minimize the cost while maintaining a good service level, however, to achieve them both it needs a lot of effort. For instance- there exists an obvious tradeoff between these two objectives-if supply chain requires to maintain a high service level, its system-wide costs will rise, or if the supply chain requires its system-wide cost to decrease- then the service levels need to be reduced. Therefore, balancing the tradeoff is a complex process in supply chain network planning.

Supply chain network plan can be divided into three steps –planning, positioning, and allocation. According to Simchi-Levi et al (2008), network design provides physical infrastructure and coordination for the supply chain.

Planning the supply chain network is a complex yet important process, it includes a set of strategic-level decisions that would impact the future overall performance of a supply chain.

Factors that influence network planning in supply chain management

Rapidly changing consumer preferences, volatile markets, constant ambiguity and uncertainty have made traditional linear supply chains obsolete. These shortcomings are obvious in their inability to meet the needs and keep pace with diverse consumers. Fragmented supply networks and operational inefficiencies that hamper scalability have further compromised the responsiveness of businesses.

Benefits of supply chain network planning

An effective network plan in the supply chain can improve competitive advantage. These advantages help in decreasing the inherent risks of purchasing raw materials and selling goods and services. There are several benefits of supply chain network planning.

Reduces costs

Effective supply chain network planning can reduce costs in key areas such as improvements to your inventory system, improvements to system’s responsiveness to consumer requirements, optimization of storage space for finished goods, eliminating deteriorated or damaged resources, improved relationships with both distributors and vendors.

Increased efficiency

Having the capability to include supply chains, innovate product strategies and integrate logistics can give businesses an advantage to predict demand and make corrective actions. Having a solid supply chain plan will help the companies to adjust dynamically to fluctuations in demand, the short life cycle of certain goods, and emerging markets.

Increased output

Improvements in the supply chain network planning can result in improved output. It results in optimized collaboration and coordination with organizations that handle transporting and shipping, as well as suppliers and vendors.

Increased profits

When companies incorporate state-of-art technologies and better collaboration between various business areas, it will improve productivity and efficiency. Thus, resulting in increased profits for the business in the long run.

Better coordination

Having superior coordination is one of the fundamental features for most successful businesses. When there is a lack of coordination; distributors, vendors, and employees struggle to have an idea about the plans. Effective supply chain network planning can yield a huge advantage of improved cooperation between various entities. Moreover, when businesses open their door to new technologies such as supply chain management software, they can take the advantage of not even having to be in the same location with people to collaborate and communicate effectively.

With improved communication between various areas of business, organizations can have quicker access to accurate reports, forecasts, statuses, quotes, and several other plans.

Eliminates delay

With an effective network plan, businesses can eliminate or lessen delays in supply chain processes. With everyone more aware of their role in the business, issues like logistical errors, late shipments, and hold-ups on production lines can be mitigated.

Conclusion

Achieving an optimal supply chain network planning is not a simple process, but it is vital for the growth of the business. Supply chain network planning includes planning implementation and control of supply chain operations. It aims at finding the best possible configuration so that all possible operations are performed efficiently.

Effective network planning in the supply chain can help the organizations to balance the tradeoff among inventory, manufacturing, and transportation. It also aids in creating a balance between demand and supply under uncertainty through effective inventory positioning and management. Besides that, network planning can balance the available resources to choose the most suitable product sourcing facilities.

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What is Cost Benefit Analysis?

CBA or Cost Benefit Analysis is an efficient technique that is used to evaluate and review the benefits and costs of any given project for two reasons-first, to define the feasibility of investment; and second, to explore alternate options to accomplish the same goal.

For calculation the total expected cost of all the options is compared against the total expected benefits, to identify if the benefits are greater than the costs, and, if so, then by how much. An effective cost benefit analysis evaluates the following benefits and costs-

Benefits –

• Direct
• Indirect
• Net Benefits
• Total Benefits

Costs-

• Indirect cost
• Direct cost
• Opportunity cost
• Intangible cost
• Costs of potential risks.

Cost Benefit Analysis in Project Management

In project management, CBA is used to evaluate the cost vis-à-vis the benefits in your business case and project proposal.

To begin with CBA, a list of all project expenses and what are the expected benefits once the project is successfully executed is made. One can calculate CBR (cost-benefit ratio), ROI (return on investment), IRR (internal rate of return), NPV (net present value), and PBP (Payback period) from this list.

Whether the benefits are greater than costs will decide if action is necessary or not. In most cases, if the cost is 50% of the benefits and the PBP is not more than a year, then it is worth taking the action.

How to do a cost benefit analysis?

Cost Benefit Process has evolved with time. Here is the checklist to perform CBA-

• What are the goals and purposes of the project? -You will have to create a business case for your project and define its objectives and goals.
• What are the alternatives? – Before you go ahead with your project, you need to compare it with similar past projects to choose the best way forward. You can do a quick review of its success metrics such as ROI, IRR, PBP, and cost-benefit ratio.
• Who are the stakeholders? – You need to make a list of all stakeholders and identify the decision makers from that list.
• In what manner will you measure cost and benefits– You need to decide on the metrics that you will use to measure the benefits and costs
• What is the outcome of benefits and costs? – Assign a monetary value to the benefits and costs of the project and map them over a relevant period. It is vital to know that cost benefit analysis estimates the monetary value of both future and present costs and benefits.
• What is common currency?– Since you can’t compare the present monetary value of benefits and costs with the future rates, you will have to calculate the discount rate, the time value of the discount rate, and the net current value of cash flows.
• What is the discount rate? – It is the rate that is used to calculate the present value of the future cash flows of your project.
• What is Sensitivity Analysis? – It is a probability method which is used in business and management to identify how uncertainty affects decisions, benefits, and costs.
• What is your project’s NPV (net present value)?– It is the measurement of profit that is calculated by deducting the current values of cash outflows from the current values of cash inflows over a period.
• What do you do once your cost benefit analysis is complete? – The final step is to make the choice that is recommended by CBA once you have all the data.

Why Cost Benefit Analysis is vital for supply chain management?

Cost Benefit Analysis helps in choosing the best approach and evaluates the monetary and quantitative impact. CBA helps the management to gain knowledge about the pricing strategies and their impact on the supply chain, therefore, helping build robust supplier relationships while driving profitability.

For instance- The Covid-19 pandemic has exposed the lack of visibility of many companies into their offshore manufacturers and suppliers. Thus, leading to a call for better supply chain traceability and resilience. This has led many businesses to consider moving parts of their supply chain to local regions. In such a scenario business will have to perform a Cost Benefit Analysis of localizing the supply chain taking into consideration the potential barriers for relocation and way forward while comparing the benefits vs costs of both onshore and offshore.

Conclusion

CBA simplifies complex business decisions and provides a basis for rational comparison. Therefore, the analysis should be kept as comprehensive as possible as it reflects the interest of all the stakeholders.

The post Project Management Resources – Cost Benefit Analysis for projects appeared first on ScaleUp Consulting..

Supply chains involve a series of processes that takes a product from the manufacturer to the consumer. For supply chain networks to function suitably, they require operational and management support.

Choosing a career in the supply chain industry- here is all that you need to know

A career in the supply chain industry offers so much diversity. It gives you an in-depth overview of the complete organization where you not only learn the suppliers’ business but learn customers’ business as well. There are many departments from production, procurement, shipping, finance, and accounting to warehousing, marketing, R&D, and sales.

In this constantly and ever-changing industry you can gain a variety of experiences. Simply put, the industry offers something for everyone- there are numerous opportunities for those who like to be led and inspired, and for those who like to lead and manage.

To get started with a career in supply chain management, here are some important things to consider-

Understanding the supply chain industry

Depending upon the industry and organization, supply chain management roles can vary. One needs to keep in mind the size of the company as well as ownership as these factors can have a significant impact on your career. In big enterprises, you may have to start working within a function or segment of the supply chain that has a lot of resources. Whereas, in smaller organizations, you might have to manage multiple tasks that may give you wide exposure to the supply chain processes, but has limited resources. Therefore, it is vital to understand the requirements of the industry thoroughly before you begin your journey.

Pick a supply chain management area that interests you

There are innumerable career options within supply chain management, however, you must opt for an area that interests you. You should get yourself acquainted with that specific area by reading about topics related to it. This will help you to determine whether you want to pursue it. Typically people choose the following career paths in the supply chain field-

• Production/Operations Management
• Supply chain planning and/or Technology
• Supply Management/ Procurement
• Distribution Management/ Logistics

Keep yourself abreast with the latest and upcoming trends in supply chain management

You can keep yourself updated with the latest trends and technologies in supply chain management as it will allow you to take important career decisions. You can enroll for supply chain management sessions or read blogs or can engage in various discussions forums.

What qualification do I need to start a career in supply chain management?

The most common way to pursue career in supply chain is a bachelor’s degree in SCM, logistics or international transport. In addition there are various courses available such as CPM (Certified Purchasing Manager), CPIM Certified in Production and Inventory Management, Certified Supply Chain Professional, Supply Chain Operations Reference (SCOR) Professional, and Certified in Logistics, Transportation, and Distribution.

You may also pursue a master’s degree in supply chain, logistics, and/or transport. Doing MBA is also a great option.

How do I enter the supply chain industry?

There are several ways to break into the supply chain industry. Typically people start by using the services of recruitment agencies or by putting up a profile on various job portals. One can also use networking- looking out for industry-type events in your area that can give you an opportunity to meet and interact with professionals.

Another option to get real-world experience is by looking for a supply chain internship that is closely related to the job role that you are interested in.

What career options do I have in the supply chain industry?

There are many entry-level jobs that you can explore that do not require prior experience but only some kind of degree/diploma or certification. These jobs require a period of on-job training. For instance- cost estimators, quality controllers, customer relations, marketing and advertising, and buyers.

But that is not all, supply chain management offers many other possibilities as well such as –IT specialists, Data Managers, Finance Managers, Human Resource Personnel.

In case you are graduated with a bachelor or master’s degree in the supply chain you can also consider the following career options-supply chain analyst, supply chain coordinator, production planner/ inventory controller, purchasing agent, logistician, procurement analyst, and warehouse manager.

Final Word

Supply chain management is a vast field that offers a lot of opportunities. All you need to do is to carefully choose your niche and then set about gaining relevant knowledge and expertise.

The post Getting started with a career in supply chain management appeared first on ScaleUp Consulting..