From Unpredictable to Resilient and Agile
Despite the disruptions of the past years, there are some emerging key trends in Supply Chains that provide both challenges but also opportunities for manufacturers.
The momentum towards more sustainable supply chains is coming from many directions.
- Consumers are demanding more environmentally friendly products, and this demand comes more strongly now after the lockdown and its effect
- Governments are legislating more environmentally friendly manufacturing practices and materials,
- and the risk to the brand image is driving manufacturers to use less polluting packaging materials.
Future supply chains will model processes that Re-Use and Re-Work wastage.
In the future, we will include Circular Supply Chain in the network design. Decisions will be strongly influenced by sustainable product design and material sourcing decisions.
Business alignment between the different levels of the Supply Chain became more important because of the fracture between Operation, Tactical and Strategic plans during such disruptive periods that became more and more the “normal” life. Operation planners found themselves making strategic decisions that have a strong influence on financial outcomes. Mainly when they decided to change the sourcing or capacities. So, there is a strong requirement to align all levels of decision-making with the financial objectives of the company allowing to take quick and important decisions that is align with the company strategy.
The digital transformation of business over the past decade has created many new challenges. We manage today such a volume of data that needs to be protected from cyber-attack but also, we need to follow governmental regulations as GDPR. Of course, businesses need also to leverage the digital advantages to remain competitive.
As supply chain processes become more automated and augmented and adopt powerful analytical engines; the new planner needs to be able to manage new technologies and to be highly analytical & collaborative deal-makers.
REQUIRED SUPPLY CHAIN CHALLENGES
To meet these challenges, manufacturers need to adopt new capabilities.
Data that exists in the isolation of the 4 walls of a company is a thing of the past. Companies are increasingly connected to new external sources of data. The data may exist in applications, or in machines. It may exist in the IoT or as we can anticipate in trading platforms or ecosystems. We are not saying that every manufacturer must be connected to every source, this is impossible. But manufacturers need to be ready to be connected to the relevant source of data.
As trading partners become more connected, they become more aligned. A global and connected Supply Chain will operate more efficiently. However, connectivity is not just about data, it requires the trading partners to work closely together to mitigate risk, exploit opportunities, and solve the problems of the next big disruption whether it will be a pandemic or a trade-war.
As data volumes increase and the frequency of changes increases, manufacturers need to invest in technologies to be always alerted on changes and be able to immediately calculate new scenarios. This cannot be done by traditional methods. This will lead to richer automated and augmented decision making. The decisions will become more accurate as the underlying data is validated by intelligent data cleansing and digital twin technologies.
Hyperconnectivity brings data updates with a higher update frequency. Intelligent systems need to rapidly re-plan scenarios with new data to identify the impact of change. New technologies and new processors allow such quick calculations. Planning needs the ability to absorb change, understand the impact, and prepare immediately a “plan-B” if necessary.
SUPPLY CHAIN PLANNING TECHNOLOGY VISION
The good news is that we have today the right technologies to achieve these requirements.
Everything about supply chain planning is now digital. We use Digital in this context as a collection of technologies from Predictive Analytics, Process Automation, Data Lakes, Internet of Things, Machine Learning, Blockchain, etc…
But also, being on the cloud in 2020 is no longer a deployment option, it is the choice to embrace a digital future. The cloud opens up new services, advanced security, platform connectivity, and business continuity capabilities not available on-premise.
I’m sure that every person reading this blog has received social messages during the last 3 hours. Social networks became the more used communication tools today. Social communication tools that are common with teenagers and personal communication evolved into a standard enterprise communication tool. It’s why it is required to integrate all these social capabilities in the Supply Chain Planning collaboration solution. Collaboration won’t be only between people but in the future, it will be between people and machines or chatbots or simply between machines thanks to natural language processing.
We have today more and more data, more frequently, and more complex automation processes. It is then imperative that technology continues to evolve to handle larger volumes of data while running more analytical processes. There is no benefit in having real-time data updates if it takes several hours to be processed. There are new developments in this area like 5G networks, Edge Computing. The QAD DynaSys R&D team incorporates the “Performance factor” into every development and innovation.