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Enterprise Agility
Commentary

3 Ways CIOs Can Be the Linchpin to a Strong Supply Chain

Enterprise CIOs can play a pivotal role in improving and modernizing supply chain operations so that businesses are well-prepared to manage disruptions in the future.

The world is continuing to manage through waves of the COVID-19 pandemic. Vaccine distribution is well underway, and we’re slowly seeing positive signs of economic relief. However, many business leaders are still reeling from last year’s rollercoaster of disruptions and are evaluating what exactly went wrong from an operational standpoint. Consistently, one thing continues to remain somewhat unsteady: the supply chain.

The ongoing pandemic-related spikes and shortages across all industries are a stark reminder that when a market disruption occurs, a strong supply chain is crucial to business survival. But the important lesson for organizations to learn and apply moving forward is that the supply chain must be approached as a company-wide responsibility.

As we navigate this time of massive change, here are three pieces of advice for CIOs as they play a uniquely critical role to support technology supply chain operations and drive resiliency:

1. Unite disparate IT systems across the supply chain

Businesses often overlook the role that IT infrastructure plays in supply chain resiliency. When a disruption happens -- be it a pandemic or natural disaster -- all IT systems responsible for supply chain operations need to talk to one another in order to effectively respond to turbulence. Unfortunately, in most cases, the cause only becomes evident after the disruption has already happened because the myriad IT systems aren’t communicating and aren’t working in concert. As CIOs slowly exit the fire-fighting mode brought on by the pandemic, now is the right time to start working on synchronizing disparate IT systems to prepare for the next disruption.

A good first step is to start evaluating the mismatch in IT systems and processes across the supply chain. Once the audit is complete, CIOs need to choose the best practices and platforms to carry forward and identify which parts of legacy systems can be eliminated. This process may look very different depending on the systems you already have in place. A good litmus test is if you are still running your supply chain operations on disparate spreadsheets and phone calls, it might be a good time to reevaluate your tech stack and look for opportunities to modernize.

2. Avoid quick fixes

Moving physical products is messy and difficult, and organizations often can’t afford supply chain interruptions without hurting their bottom line. This leads to enterprises addressing supply chain issues with quick, superficial solutions as opposed to implementing solutions that feed into long-term strategic goals. This struggle is familiar for any enterprise CIO, and I am no exception. We had to cross that bridge recently when we rehauled our entire supply chain following several acquisitions.

As a newly combined organization, we had the option to continue working with the disparate systems we inherited from the acquired companies, but we knew that level of complexity would hurt us in the long run. Instead, we fully automated and centralized our vendor-managed inventory (VMI) process. This helped streamline operations and distribution and unlocked new levels of efficiency. Had we not done this, we wouldn’t have weathered the multiple unexpected disruptions that followed, including tariff wars and COVID-19.

3. Ensure company-wide alignment on supply chain strategy

COVID-19 exposed a lack of stakeholder mentality when it comes to the company supply chain. A business could have the best product on the market with the most outstanding sales function, but if its supply chain isn’t able to deliver the product to customers, all the work done by engineering and sales is for naught. It’s absolutely crucial for everyone to understand the role each function plays in building a strong supply chain and maintaining alignment.

I find that the best way to do this is to maintain standing check-ins between supply chain leads and the key stakeholders including the CEO, CFO and CIO. From a CIO perspective, it’s important to hear about the issues your supply chain team is experiencing, establish a cycle of frequent feedback, and address concerns proactively.

Like many in the tech industry, we had to take action to address the ongoing chip shortage. My IT team worked directly with the supply chain team to improve visibility into ordering for partners and secure vendor commitments to help us accelerate product delivery. This would not be possible without regular and frequent touchpoints between our teams. We have also worked to actively manage the supply chain through a strategic relationship with Broadcom. By maintaining a regular cadence of meetings and opening communication between teams, we have created a process that allows us to manage our supply chain as successfully as possible as the chip shortage continues.

In Summary

Disruptions like labor shortages, natural disasters, and geopolitical issues will continue to happen, putting even the most resilient supply chains to test. Before that happens, I urge my CIO peers across enterprises to think about the part they play in supply chain operations and what they can do to ensure that come the next disruption, their logistics leads are equipped with the tools and support they need to weather the storm.

John Abel, CIO at Extreme Networks, is responsible for all aspects of the global IT organization and has more than 30 years of IT industry experience leading large teams and driving digital transformation for global Fortune 500 companies. He was previously SVP and CIO of Veritas Technologies and SVP and CIO of Ellie Mae. You can find him on LinkedIn.