February 22, 2024

Three Steps for Aligning Your Supply Chain With Marketing Strategy

The three pillars of supply chain excellence are cost, service, and capacity. The best companies strive for high performance in all of them. What tends to separate best-in-class supply chains from the rest, however, is the level of alignment between the pillars.

Marketing contributes to the strategic clarity of the supply chain by providing essential marketplace information that impacts demand. This knowledge helps partners align their production and inventory considerations with customer needs. Marketing also focuses on developing the internal and external relationships that support supply chain operations.

In this regard, a culture of clear communication is critical. It fosters collaboration, keeps stakeholders informed, ensures budgets are allocated properly, and supports departmental alignment. It also provides a vehicle for sharing the company’s corporate strategy, and establishes value-aligned goals.

The final step is establishing policies that promote and incentivize the desired supply chain performance. This involves identifying your preferred operational delivery model and setting the corresponding goals. It also involves clearly communicating those objectives to suppliers, including defining key requirements such as tools, sustainability-related goals, and material quality.

It is also important to have robust policies in place to cover the inevitable exceptions that occur throughout the supply chain. For example, a policy for expedited transportation should be in place to mitigate the impact of the occasional order cancellation or shipment delay. The success of this policy depends on effective S&OP, demand planning, and warehouse/transportation performance. It should also be based on real-time supplier feedback that provides visibility into operational risks and delays to reduce the frequency of execution of this policy.

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