Public and Private Sector Supply Chains - Learning Lessons

THE LOGISTICS BUSINESS works extensively on logistics and supply chain management for both the public and private sectors of the economy and it is surprising how many similarities there are.  It’s true that there are different factors at work, which drive the processes, but when you get down to the underlying requirements, the basic principles of good logistics and supply chain management are just as applicable.  What is more important is there there are always lessons to be learned - by the private sector from the public sector and vice versa.

For example, our work with one Government Department has shown us that responsive supply chains are just as important to the public sector as they are to the private sector.  We were asked to look at how a particular supply chain could be improved to provide the capability for rapid response in time of urgency.  This led us to look at different storage options for fast and slow moving times, different supply channels for high volumes and, not least, supplier relationships and how suppliers could have a more integrated involvement in the overall supply chain; all of these were the application of methods and techniques that we had previously applied for our retail and manufacturing clients. In another project, for the UK Ministry of Defence, we were asked to look at systems and processes, including IT systems, for managing the flow of many different goods and materials through a complex supply chain in combat and non-combat situations.  It was interesting to see how track and trace processes, used in parcel carrier networks, could be transferred to the MOD requirements provided special attention was given to mission critical areas of activity.  On the other hand our work on public sector funded waste management logistics has show us just how much the private sector has to learn in some areas.   Here the public sector is leading the way with development of good practice techniques and our work here has enabled us to show our private sector clients how to reduce costs and improve performance.

Whatever the sector and whatever the business, the basics for good supply chain management remain the same.  The key things are firstly to understand the customer requirements (with customer defined in the broadest sense as the recipient of the goods and/or service) and then to consider how those requirements can be met at minimum cost to the supplier.  This involves a wide knowledge of systems, processes and technology and, just as importantly, how to management and motivate people.