Four Strategic Objectives For Supply Chain Planning

Introduction

Planning for supply chain operations typically starts with a blank canvas and ends with a white board filled with every imaginable process, task, or risk possible. In the midst of this migration from nothing to considering everything, business leaders, supply chain professionals, and customers often lose sight of the strategic objective. Our intent with this writing is to remind supply chain stakeholders to identify the primary strategic objective and keep that objective at the center of the planning process. Doing so will help anchor the rest of the planning process to a single, unambiguous objective.

Strategic Objective Categories

The next question should be how do we identify the primary objective? In our Supply Chain Navigation Model, we have narrowed down strategic objectives into four categories: velocity, cost, product/service specific, or quality. All other attempts to list a strategic objective can be assigned in one of these four categories. Let us take a few minutes to unpack each.

• Velocity. This objective focuses on speed through the supply chain. In essence, the customer is most concerned with having their product or service move as quickly as possible from upstream to downstream.
  

• Cost. This objective turns our attention to keeping costs as low as possible as we move through the network. Keep in mind that low cost and within budget are two separate concepts. We will work on the budget in the next step of the navigation model, but for now, cost is our commitment to keep costs as low as possible for the customer.
  

• Product/Service Unique. This objective is one that some people will struggle with at first, but there are certain items that are so unique that we need specialized capabilities to effectuate supply chain operations. In this case, the unique requirements would take precedent over the other strategic objectives and put us in a position where we cannot achieve any other objectives.
  

• Quality. The last type of strategic objective is quality. Think white glove services and a very customized approach to supply chain operations.
  

Conclusion

Defining the strategic objective from the outset of the planning process, especially using the four categories above (velocity, cost, product/service unique, and quality), will keep the team focused on a single objective through the planning process and make the entire process more effective by quickly eliminating players or identifying tradeoffs.