Overlooking Materials Management in Supply Chain

Overlooking Materials Management in Supply Chain is more common than you think. Rarely you will find a Materials Management as a stand-alone function within the construction supply chain.

What is the difference between Supply Chain and Materials Management?

Generally, Supply Chain is a reference to the interactions among the various functions within the supply cycle. It includes demand planning, procurement, logistics, warehousing, inventory management, construction. But you think that is all to it in Supply Chain, right?
If all functions mentioned above represents the body of supply chain, then the interactions among all of them is Materials Management.

Materials Management is the brain of it all.

Also it is the nervous system and the glue that brings all of these functions together. It regulates, measure and integrate all these functions internally and externally with suppliers, customers, quality, project controls, construction team, accounting and marketing.
Materials Management collects information and metrics to effectively support the decision making process and drive the business strategies to achieve the set goals.

Why businesses overlook Materials Management?

1. • First, it is not a common knowledge and requires more sophisticated skills like information management, programming, business intelligence capabilities and the integration know-how. (See related articles for more detail: Efficient vs Effective…)
2. • Second, it requires an investment to build such a function within the supply chain. Therefore, it could be regarded as an unnecessary overhead that might take away from the profit margins.

There is a famous say: "Penny wise dollar foolish". Typically, businesses who implement Materials Management Program tend to have more satisfied customers, profit more, reduce constructability costs, stay on schedule, minimize risks and have better working environment in the office and on the jobsite.

The good news!

Master-BI can provide you with the tools needed to overcome all technical challenges like information management, programming, integration, and business intelligence. And as a result, your team’s know-how becomes easily achievable, fun and exciting. Almost instantly you can feel the difference in the performance and cohesion and most importantly results. All of that without hurting the bottom line.

1. • Efficient vs Effective Supply Chain. What is the difference?
2. • The main reason why 75% of ERP implementations fail.