7 SAP SCM Best Practices for Consumer Products Companies

For small- to mid-size consumer products companies, optimizing their Supply Chain Management (SCM) processes can make all the difference in staying competitive, reducing costs, driving growth, and meeting customer demands in today’s landscape. One of the most powerful tools available for achieving this optimization is SAP SCM.  

SAP Supply Chain Management (SCM) is an integrated suite of software solutions designed to streamline and automate key processes across the supply chain, from procurement to production to distribution. While SAP SCM offers a wealth of features and functionalities, small- to mid-size consumer products companies often face unique challenges when utilizing this tool.  

Below, we outline some SAP SCM best practices for small- to mid-size consumer products companies looking to drive efficiency and maximize the ROI on their SAP system. 

7 SAP SCM BEST PRACTICES 

1. Define Clear Objectives 

Before diving into the SAP SCM, it's crucial to define clear objectives and goals. Organizations should identify specific pain points and areas for improvement within their supply chain, whether it's inventory management or order fulfillment. By understanding what the end goal is, SAP SCM can be tailored to address these specific needs effectively. 

2. Invest in Training and Education 

SAP SCM is a robust platform with numerous features and functionalities. As such, investing in comprehensive training and education for teams is essential to ensure that they can fully leverage the capabilities of the software. Organizations should also consider providing both initial training for new users and ongoing training to keep the team up to date with the latest features and best practices. 

3. Customize SAP SCM to Fit Your Needs 

One of the key advantages of SAP SCM is its flexibility and scalability. Most organizations tailor the software to fit its unique needs and processes, leveraging customization options to configure workflows and dashboards that align with the organization’s specific requirements. By customizing SAP SCM, organizations can maximize efficiency and productivity across all levels of the supply chain. 

4. Integrate SAP SCM with Existing Systems 

Seamless integration with existing systems is critical for optimizing efficiency and minimizing disruption when leveraging SAP SCM. Whether it's existing ERP systems, warehouse management systems, or third-party logistics providers, organizations must ensure that SAP SCM integrates smoothly with existing infrastructure. A successful integration ensures quality data exchange, reduces manual effort, and improves overall visibility and control across the supply chain. 

5. Utilize SAP SCM’s Advanced Analytics 

SAP SCM offers powerful analytics and reporting capabilities that can provide valuable insights into supply chain performance, allowing for more informed decision-making. As such, organizations should leverage advanced analytics tools to track key performance indicators (KPIs), identify trends, and make data-driven decisions with SAP SCM. By harnessing the power of data analytics, organizations can optimize inventory levels and supply chain efficiency while improving demand forecasting accuracy. 

6. Implement Demand-Driven Planning 

Demand-driven planning is essential for staying responsive to changing customer needs and market trends, particularly in today’s dynamic consumer products landscape. SAP SCM offers advanced demand planning functionalities that enable companies to forecast demand more accurately and align production and inventory levels accordingly, helping them keep up. By adopting a demand-driven approach, organizations can reduce stockouts, minimize excess inventory, improve customer satisfaction, and more. 

7. Embrace Collaboration 

Collaboration is key to success in supply chain management, particularly for small- to mid-size consumer products companies that often rely on partnerships with suppliers, manufacturers, and distributors. SAP SCM's collaboration tools help to facilitate communication and information sharing across the supply chain ecosystem, improving overall transparency and visibility for all. It’s through this enhanced collaboration with stakeholders that organizations can reduce lead times and drive greater overall efficiency up and down their supply chains. 

LEVERAGING SAP SCM FOR MAXIMUM EFFICIENCY 

SAP SCM offers small- to mid-size consumer products companies a powerful platform for optimizing their supply chain processes and driving efficiency. By following the best practices outlined above, companies can fully take advantage of SAP SCM’s breadth of capabilities to gain a competitive edge in a fast-paced consumer products market. 

If you’re a small- to mid-size consumer products organization looking to learn more about SAP SCM, Crescense can help.