For some businesses tactical operations and short-term changes have been enough to sustain them over the years, however they are not enough for today’s customer. The modern customer is more demanding and has higher expectations when it comes to delivery costs and timings than ever before – meaning warehouse operations need to be meeting these demands.
Especially now, in the midst of the Covid-19 pandemic and as we look towards economic recovery, the supply chain is going to take centre stage – with warehouse operations playing an essential role.
Tactical Vs Strategic
By definition tactical and strategic operations are the opposite. Tactical operations are short-term, actionable steps whereas strategic operations are based on longer term, broad goals that are overarching of all operations – in the warehouse and beyond. Strategic decisions are generally guided by higher job levels. Industry Week specifies that generally directors and vice-presidents would have 75%-90% focus on strategic work whereas people such as buyers may only have a 15-25% focus on strategy and instead implement the tactical activities.
Within any business there is place for both of these – but by only focusing on tactical decisions businesses are missing out on growth opportunities.
The Benefits of Strategic Warehouse Operations
1. Strategy Lays the Groundwork for Growth
Strategy level decisions lay the entire framework for the supply chain process – from the start to the end. This is an integral part of supply chain management – making these decisions is the first step in developing a good process. At this level the following should be addressed: IT systems, inventory management systems, long term innovation, creating a network of suppliers and choosing sites and purposes of specific facilities.
2. Creates Clear Goals
The strategic decisions made at this level lay out clear goals for the business, and different operations. In relation to warehouse operations this could be to do with picking and packing orders – a tactical activity that is driven by overall strategic goals of better inventory management and meeting customer expectations efficiently.
3. Strategy Guides Decisions at all Levels
Strategic decisions are long term – usually between 2-5 years. These decisions are made at a higher level for this reason. Things such as inventory distribution, capacity planning and network expansion are all handled at the strategic level but directly impact and guide decisions made on the warehouse floor and in day-to-day tactical activities.
4. Strategic Work Defines Tactical Activities
Tactical activities are directly defined by strategic decisions. Tactical activities with no strategic alignment are essentially not directly impacting growth. Planning is done at the strategic level, but processes are defined at the tactical level. If at the strategic level customer satisfaction with delivery time is a goal – the tactical activity will be to make that happen and to produce schedules and guidelines to meet that goal.
Combing the Tactical with the Strategic
It isn’t as simple as swapping tactical operations for strategic but ensuring your operations are support by both the tactical and the strategic. The tactical activities are defined by the overarching goals defined at the strategic level.
Concerns at a tactical level are customer demands and end value whereas at Strategic level it is the first step in developing a full process. The day-to-day actions and processes can be defined as the operational level.
No strategic planning can reach it’s potential without the hard work at tactical and operational levels. But combining the three can be daunting. This is where outsourcing your logistics can play a role as a business owner.
Strategic decisions directly impact growth and influence all decisions. But the tactical and operational activities can be time-consuming and tedious when it comes to warehouse operations. By outsourcing to a third-party logistics provider, you can pass the tactical and most importantly operational tasks on to professionals. To understand how this would work in practice, take inventory distribution as an example:
At the strategic level it is decided that the goal is to increase delivery times by 50% by the end of 2 years. This is with the premise of improving customer satisfaction and increasing reach.
At the tactical level this would involve distributing inventory across locations, getting stock closer to customers and ultimately with them quicker. At Trident we have a network of fulfilment centres and warehouses to get you closer to your customer.
At the operational level the orders would be picked, packed and shipped efficiently and effectively – reach your customer on time. Trident can automate this entire process, integrating it with your entire operation and supply chain.
For successful warehouse operations and in turn a successful supply chain management system, you need to be able to make effective and valuable decisions at every level and integrate them through your entire operation. Trident can help with the tactical and operational, ensuring you are achieving the best results, so you can focus on strategy and growth.