5 steps towards a future-proof pharmaceutical supply chain
Pharmaceutical companies have been faced with major logistics challenges since the outbreak of the coronavirus pandemic. What factors does your organization need to consider in filling your important public role? What steps do you need to take to efficiently deliver your vaccines or other medical products/supplies?
Step 1. Managing supply chain inventories
Check inventory levels across the supply chain and find out how long this stock will allow you to serve your customers. What is in the pipeline right now? Can suppliers continue to deliver as agreed during these unpredictable times? Prevent out-of-stocks of raw materials and keep liaising closely with your suppliers. Remember to regularly update and monitor the master data for the raw materials to ensure you order the correct quantities in time. Are substitute products available for this customer? If so, how will using these affect the supply chain?
Step 2. It's all about the data
The key to effective supply chain management – now more than ever – is data that accurately forecasts customer demand, as this improves stability and reduces waste, including expiring stock. Calculate how you can serve the customer and what the impact will be on the supply chain. Prepare your vendors and suppliers for the changing demand by sharing this information with them. Additional orders in crisis situations tend not to be data-driven and result in overstocks of non-critical raw materials, which reduces both cash flow and capabilities.
Step 3. Optimizing capacity proactively
Check if your current processes are equipped to accommodate customer demand. If the answer is negative, explore ways of increasing your capacity – including production capacity, storage capacity and transport capacity, as these tend to be overlooked a lot of the time. Increased customer demand and distribution problems involving end products can compromise your operating processes. Use methodologies such as Lean Six Sigma in order to solve capacity problems – this will help you streamline your processes.
Step 4. Strategic partnerships
The coronavirus pandemic has shown for both suppliers and logistics partners that strong partners in the supply chain can determine the difference between success and failure. Single sourcing – purchasing materials from just one supplier – is too risky in the face of the current challenges. In order to facilitate the distribution of the coronavirus vaccine, logistics is vital to the cold chain, the required system to maintain the product's low temperature during transit. We therefore recommend that you work closely with a specialized logistics service provider or 4PL specialist that can manage the entire global supply chain.
Step 5. Process innovation
Now is the time to be innovative and engage in process improvement. There may be a need right now for new distribution models or even brand-new logistics concepts, including an extension of the customer push-pull point. In addition, there are various IT solutions available (including RPA) that allow you to focus more efficiently on activities that add customer value.
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Demand & supply planning
Supply chain management