Why Internal Communication Is Essential To Supply Chain Success


Supply chains are highly collaborative, well-orchestrated logistical systems. Maintaining a high perfect order rate and a quick cash-to-cash cycle requires perfect communication with all internal and external stakeholders.

However, many supply chain firms focus their communication efforts entirely on clients, media outlets, and competitors. This means that inefficiencies in internal communications often go unaddressed until poor communication causes bottlenecks that diminish profitability.

Ignoring internal communication is a major misstep. Effective internal communication can help supply chain firms forecast future issues, improve employee engagement, and improve KPIs like inventory-to-sales ratio and fill rate.

Engagement and Motivation

Supply chain management is an increasingly technological field. Supply chain managers rely heavily on IT and AI to forecast future issues and ensure that deliveries are made on time. However, highly motivated humans are still the backbone of supply chains all around the world.

Employers who fail to protect mental well-being at work will find that staff productivity, and profits, quickly diminish. Unhealthy workplaces have a negative impact on our mental health as employees who feel depressed at work are less productive, need more time off, and are more likely to become burnt out.

Conversely, employers who promote greater mental well-being at work will benefit from more loyal, engaged employees. The reasoning is simple: folks who feel valued are more likely to stay in the same company for an extended period and are more likely to care about the profitability of the company.

Effective internal communication is the key to greater engagement, motivation, and mental well-being at work. Without effective communication, managers won’t know that their employees are struggling, and employees won’t know how to advocate for themselves.

Businesses that care about their employees’ well-being can create direct lines of communication between staff, managers, and HR. HR departments can help direct employees toward the correct resources if they feel stressed, burnout, or are struggling with conditions like anxiety or depression.

Taking these issues seriously ensures that supply chain managers are performing their best and are motivated to effectively forecast the future. Engaged, motivated staff are more likely to reach out to others when they spot issues—even if those issues don’t directly pertain to their job description. This ensures that all of the departments of a business are working in unison, and can prevent issues that cause supply chain bottlenecks.

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Forecasting the Future

Supply chain managers aren’t oracles, but they are paid to forecast future challenges and make strategic changes to supply routes and inventory. Most of these insights are gathered through quantitative forecasting that leans on auto-regressive integrated moving average (ARIMA) calculations and Multiple Aggregation Prediction Algorithms (MAPA). Sometimes, however, supply chain specialists learn about changes to markets through internal communications.Effective internal communication ensures that useful information is fed to the supply team as quickly as possible. If, for example, the sales team learns about upcoming strikes in a foreign market, they can quickly relay this information to supply chain specialists who can modify supply routes to minimize disruption.

Improving internal communications also benefits growing companies and improves trust between teams. This is particularly important for businesses that are expanding their operations, as supply chains can become overlooked during expansion. Supply chain specialists should be embedded within all decision-making and should play a central role in internal communications.

Supply chain specialists can improve communication in their business by investing in AI-led communications. AI software can automate routine tasks like inventory fulfillment and sending order confirmations. This means employees have more time to help other coworkers and will have time to consider the “big picture” before moving forward with decisions.

Inventory Management

Inventory management can be a real drag for supply chain specialists. It’s hard to hit the bullseye, and many businesses are constantly fluctuating between being over and understocked.

Effective internal communication channels can bolster the effectiveness of historic data and market trends. Supply chain managers need a direct line to other departments like sales and marketing, lest they be left behind by upcoming promotional sales and shifts in consumer behavior.

Ideally, supply chain managers should be consulted before businesses choose to run discounts and deals. This ensures that supply chain managers can order enough stock to keep the deal running for longer, and will help all marketing departments get a higher ROI on their spending.

Supply chain managers should be given the opportunity to provide feedback to other departments, too. Supply chain specialists know how much inventory the business is carrying and can see how well certain products are performing. Effective internal communication ensures that sales, marketing, and finance have all the inventory-related data they need to make well-informed decisions.


Effective communication is integral to supply chain management. However, many businesses overlook the importance of internal communication. Effective internal communication can improve inventory management systems, reduce waste, and improve the engagement and motivation of all employees. Even small changes, like including supply chain managers in marketing department communications, can improve operational efficiency and help business leaders make better-informed decisions.