With havoc at ports and terminals showing no signs of imminent improvement, it’s likely that the supply chain disruptions that have plagued businesses nationwide won’t be slowing down anytime soon. In the meantime, enterprises spanning a wide range of industries, from semiconductors to household goods, are struggling to fulfill customer orders.
Flexibility is the key to any successful supply chain system deployment. “Traditional supply chain models are slow to adapt and vulnerable to disruptions, which is why we are seeing so much chaos at distribution centers, seaports, airports, and retail stores,” observes Brian Houck, US supply chain solution leader at business and IT advisory firm PwC. “The solution already exists, but it's up to business leaders to institute changes and adopt a digital solution that works for their organization.”
Technology is a critical component in a robust, modern supply chain. Houck notes that traditional supply chains are slow, linear, and functionally driven, resulting in siloed operations that are susceptible to errors and blind spots. A modern supply chain breaks down this traditional model, enabling full real-time visibility. “Emerging digital supply chain platforms allow organizations to create a transparent, flexible supply chain that continuously collects and packages enterprise data to adapt to changes, predict future disruptions, and make more informed data-driven decisions,” he says. “A broad set of technology expertise and resources are required to effectively architect, build and perfect these platforms.”
IT plays a significant role in an enterprise supply chain, ensuring that data flows uninterrupted between business units, departments, and trading partners. “An end-to-end integrated supply chain is vital to business agility and resilience,” observes Isaac Gould, research manager at business analysis firm Nucleus Research. “For example, IT is necessary in connecting the production schedule and capacity of a supplier to the internal supply chain planning solution, which allows the business to automatically detect if a scheduled replenishment will be able to meet demand and if further action is necessary.”
Technology is an essential tool in supply chain modernization, ensuring that the supply chain is functioning correctly, efficiently, and productively. Without dedicated IT teams, enterprises would have to rely on outside consultants to ensure effective supply chain operation. “Internal IT teams can ... react faster than consultants, ensuring the business is agile, avoids disruptions, and remains competitive,” Gould says.
Supply Chain Modernization Methods
When planning an enterprise supply chain modernization initiative, it's important to closely examine the entire supply chain to ensure that performance will be optimized across all stages, including product design, planning, purchasing, manufacturing, logistics, and fulfillment or service, recommends Jeffrey Miller, director of the industrial high-tech practice at management consulting firm Kalypso.
Miller suggests beginning a modernization project by identifying and addressing potential risk sources. “Often, the most significant risks appear as bottlenecks in the flow of material and information, or instabilities in the performance of operations.”
The best way to modernize and streamline an enterprise supply chain is to focus on systems that offer visibility, analytics, and consistency, Miller says. “Consider a cohesive application of digital solutions and technologies based on a digital transformation strategy that delivers on the growth goals of the business,” he suggests.
Digital Supply Chain Platform Selection
“Consider adopting an end-to-end solution that manages your supply chain data from collection to utilization,” Houck advises. An end-to-end digital supply chain platform will automate labor and time intensive tasks, while simplifying the workstream, saving valuable time and energy.
Vendors differentiate themselves based on the supply chain networks they support, providing access to potentially valuable sources of data and potential trading partners. “These networks can include the networks of other customers, supplier networks, transportation networks, and industry-specific partner networks,” Gould says. E2open, One Network Enterprises, and Kinaxis are examples of supply chain technology vendors that leverage their partnerships and network ecosystems to support their value proposition.
While it may be tempting to transform supply chain operations overnight, a phased approach is generally the most effective method. “It's important to clearly communicate your goals and vision to employees during each phase of your digital transformation journey,” Houck suggested. “From adoption to full integration, make sure to clearly define milestones during each phase; listen to employee feedback and monitor your organization’s progress.”
Don’t underestimate the value of deep and accurate data when upgrading technology. “The supply chain typically depends on the largest, most complex data across the enterprise,” Houck says. “While many companies aspire to apply artificial intelligence and machine language to their supply chain, the truth is, without high quality data, these AI/ML engines are destined to fail.”