Automating supply chain visibility

In a supply chain survey, IDC found 98-percent of respondents indicated they are currently engaged in initiatives to improve visibility into the supply chain.

A question asked of companies, about the greatest area of concern that exists especially if left unaddressed, revealed upstream and downstream supply chain visibility as the top concern.

This is impetus to start with small steps like manual information-sharing with a view to automate and then scale this capability.

Research Director Stephanie Krishnan said, “To be able to maintain manual monitoring of supplies over a sustained period of time is exhausting, and not practical for a number of companies. So this is where we are seeing a lot of investment away from the traditional supply chain and looking at digitalising the supply chain.”

This traditional model is something the industry has been talking to move away from for the past 30 years, according to Stephanie.

Organisations are looking to deliver on a real-time, automated feedback loop of data, instead.

“I think this real-time feedback loop of data enables visibility and data-driven decision making. And it is something we’ve been pushing for in the profession for a number of decades, and the time for (automated feedback loop) is now.

I think that is the real gist of what’s happening with regards to supply chain visibility,” she emphasised.

Supporting the feedback loop

Also important is supply chain planning and end-to-end supply chain.

Stephanie explained, this is increasing visibility with Tier one suppliers and taking it out on to the road through transport, into the factory, the warehouse. “It’s a clear message it’s time to focus beyond the walls of the organisation to fully enable the digital supply chain,” she said.

Velocity or speed of information is also crucial to be able to deal with changing circumstances in the landscape. For example, events like route changes necessitates looking at transportation optimisation, network (of locations) optimisation, factory floor optimisation,and more to ensure they are able to meet requirements.

Benefits of technology

As part of the outcomes of their surveys, IDC discovered the benefit of technologies like cloud and platforms and IoT in supply chain, during the coronavirus outbreak.

“We found companies do need to have real-time information to provide intelligence. And that needs to be remote or on-site.

She shared instances of companies that had good implementation of control towers to share supplier information. “But unfortunately, they were on the premises and they weren’t able to access that remotely.

“So this is an important consideration for customers. It’s something we can do to be able to predict and react to upcoming production delays, retail stock-out, shortages, volatility in markets and other things that affect our supply chain,” Stephanie explained.

Supply chain control towers is a term used to describe systems that coordinate across multiple areas, ideally with supply chain ecosystem in place.

According to the research director it’s not just about monitoring what is happening inside your organisation, but having that connectivity beyond the current tier. “What that allows you to do is look into supplier capabilities.”

For example, organisations that looked at new capabilities to produce masks, or ventilators or other equipment for virus-fighting efforts, are able to do so, because they are able to look into their supplier capabilities.

Stephanie shared, “I was asked how was an automated manufacturer all of a sudden able to make ventilators? That seems like very different technologies.”

Data-sharing is crucial

What happened was manufacturers were able to look into their supplier network through their control network, through their supplier management, through the marketplaces and ecosystems they have, and actually determine the components or parts they have.

Stephanie explained that when talking to suppliers, they often find there is some overlap, for example a hose component in cars that can be also used in medical equipment.

“They are then able to partner with medical companies to increase that sort of production,” she pointed out.

This sort of collaboration and supplier integration and the ability to look into the network to see what capabilities are available, and start to pivot that, is something that is desirable in the near future, if not now.

“So being able to look at data-driven capabilities, see availability, looking to optimise inventory, looking at planning and placement of goods just in our regular production, and being able to eliminate those functions’ siloes is a key advantage of having these and ecosystems in place.

“Not to mention the collaboration tools and AI recommendations that typically come with it,” Stephanie concluded.