However, there are many challenges that companies face while trying to improve supply chain management.
One big challenge that they face is customer service, which means that ensuring that the products that a customer want are delivered at the right place and at the right time is a huge challenge for companies. This is made worse by the fact that the number of customers keeps on rising and meeting their needs is the only way they can maintain them because of the high competition in today’s market (RFID STUDY GROUP at Pennsylvania State University, 2006).
The other challenge is cost control; this is because companies in order to improve their supply chain management have to find a way to control costs. These are hard tasks considering their operating costs are under a lot of pressure. These pressures that cause an upswing in operating costs rise from, regular technology upgrades and advancements to keep up with the competitors, global customers who require goods to be shipped to them, expansion in costs of healthcare and constant increase in commodity prices. These pressures are not under companies’ control and, therefore, controlling them becomes a very hard task that leads to operating costs of supply chain management being high.
The other challenge is risk management and planning since supply chain management requires a lot of good planning and the right strategy for managing risks involved (W.K, P, & K.H, L, 2000). This is because this process has to be assessed periodically and its design has to keep on changing to ensure that market changes are accommodated. Companies have to identify risks and quantify as well as controlling them. There are constant changes in supply chain management such as introduction of new products to the market, new acquisition, new intellectual property to be protected, as well as maintenance of assets and security of shipping products. All these have to be planned and integrated prior to the process to