Supply Chain Quality Management
Quality issues can arise at any point in the supply chain, and it is critical that firms uncover them as early as possible to prevent incurring excess costs and mitigate risks to their reputation, compliance, safety, and bottom line. Suboptimal supply chain quality management can result in higher production and distribution costs and contribute to revenue loss as a result of unplanned downtime, delays, and disruption.
Maintaining a high level of quality across complex global supply chains is challenging, however. As firms come to rely increasingly on complex and globally distributed networks of supply partners, limitations in supply chain visibility make supply chain quality management difficult. Organizations need a way to obtain greater visibility into partner performance and facilitate seamless information exchange and collaboration to ensure the quality of products and processes across the value chain.
The benefits of supply chain quality management
Businesses carry out supply chain quality management to improve operational performance and mitigate regulatory, strategic, financial, operational, reputational, and legal risks. They use it to proactively detect and minimize risks in the supply chain—to identify quality issues as early as possible through end-to-end product and process oversight.
Supply chain quality management helps manufacturing firms ensure that quality is built into each product and every step in the processes of production and distribution. It helps them hold third-party supply partners accountable for the quality of their products and enables them to better protect the integrity of their brand while also increasing profitability. Done right, it helps companies create more consistent supply chains, reduce cycle and lead times, and improve on-time delivery.
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Best practices for effective supply chain quality management
The effectiveness of a supply chain quality management program will depend on the firm's ability to follow critical best practices, including:
- Developing an effective risk management strategy for evaluating supply partners—the first step in supplier risk management.
- Defining precise quality requirements, which are used to gauge and maintain performance across the supply chain.
- Carrying out regular audits to assess supplier performance, identify problematic trends, and create and execute corrective action plans when issues arise.
- Developing and using supplier score cards to rate and rank suppliers based on historical and current performance.
- Establishing supplier quality agreements defining when supplier audits will be conducted and how suppliers will be held accountable to their commitments.
- Leveraging digital tools and technology to streamline and enhance supply chain quality management.
Advantages of supply chain quality management technology
Forward-thinking firms are leveraging innovative technology like the digital supply network and multienterprise work management tools to ease and improve supply chain quality management. These powerful digital tools can be used to establish a constant flow of information and insights across the supply chain and promote supplier collaboration. They enable firms to move away from inefficient manual and disconnected methods of communication that limit their ability to manage supply chain-related quality issues.
Companies can use digital networking technology and work management software to improve supply chain visibility, increase accountability, and join forces with partners across the value chain to mitigate risk, ensure quality, and accelerate time to market.
Supply chain quality management in the pharmaceutical industry
Ubiquitous outsourcing across the medical supply chain makes quality management more complex and challenging, and well-publicized quality issues and incidents are provoking medical device and drug manufacturers to invest in tools that ease and enhance supply chain quality management. TraceLink's digital supply network and suite of applications for supplier relationship management are helping firms in the healthcare sector foster collaboration and obtain the shared end-to-end visibility they need to improve quality across the healthcare value chain.
TraceLink's platform, which now has over 300,000 members, facilitates real-time information flows between pharmaceutical manufacturers and their contract partners as well as direct and indirect materials suppliers. Pharma firms and the third-party suppliers and service providers they depend on can use TraceLink's multienterprise work management software to manage quality review documents in a permission-based shared workspace accessible by each company's quality and operations team. They can track metrics, display KPIs, and get alerts to detect and minimize the impact of delays and other issues. They get real-time visibility into critical business processes and insights they can use to resolve bottlenecks, weak links, and potential disruption in the supply chain. TraceLink provides the tools and capabilities they need to improve supplier performance, maintain quality throughout the value chain, and accelerate the flow of medicines to healthcare providers and patients.
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Supply Chain Quality Management FAQs
What is supply chain quality management?
Supply chain quality management is the processes through which companies assess, monitor, and proactively manage the quality of products and processes in the supply chain. It is used to create a more consistent supply chain, reduce cycle and lead times, and improve on-time delivery.
What is the purpose of supply chain quality management?
Effective supply chain quality management helps organizations identify and resolve problems with products or business processes before they lead to major problems like supply chain disruptions, drug shortages, and lost revenue.
Why is supply chain quality management so important in the healthcare sector?
Quality management is important because it is a critical component in ensuring the safety and availability of life-saving medications.