The Key Components of an Agile Supply Chain

The agile concept started in software development as an iterative method requiring collaboration to create an end product. Lately, the agile concept has been shifting to nearly all facets of business, including the supply chain.

The key concepts to an agile supply chain, and agile business, as well, are: Technologies, Empowerment/Culture, Customer-Centricity/Flexibility and Partner Relationships.

Technologies: A key component of an agile supply chain is visibility. Companies and employees must be able to quickly react and change course based on real-time data. To do this, of course, the right technologies are needed to track and display critical data points.

Empowerment/Culture: As good as real-time data may be, it is useless if the company culture is very rigid and employees are not empowered to make decisions. To have an agile supply chain, companies must have a flat hierarchy where employees always feel empowered to make critical decisions without excessive oversight. Additionally, there must always be a culture of continuous improvement internally.

Customer-Centricity and Flexibility: From a greater business aspect, companies must listen to their customers and tailor their business to their customers' needs. From the aspect of the supply chain, the supply chain must be able to easily accommodate customers' changing needs quickly and flexibly.

Partner Relationships: Whether any supply chain activities are outsourced or everything is in-house, there will always be partnerships and suppliers to work with. To maintain an agile supply chain, the relationships with all partners and suppliers must be extremely close. The partners and suppliers will grow as you grow, and the closer and more collaborative that they are worked with, the better work and adaptiveness they will offer.

The agile concept is growing similar to the lean concept, but don't confuse the two - they are similar but different. We will save that topic for another blog.