Opportunities for Growth
The global presence of supply chain operations has expanded by leaps and bounds, especially in the last ten years. The number of multinationals and overseas holdings has seen a phenomenal rise.
Besides spanning more areas and locations across the globe, the number of business entities who are part of supply chain networks has also gone up. This is largely due to organizations’ increasing reliance on third party vendors for delivering key business processes. Even some of the activities of enterprise divisions such as research & development and product design are now being delegated to external solution providers.
Rationalizing product portfolios in a fast paced and rapidly transforming market environment is also gaining prominence, although at the expense of SKUs.
Studies reveal that the business environment around the world is anything but conducive for enterprises to operate at an optimal level of production.
Official bodies are doing their bit to safeguard commercial interests through more stringent regulatory norms that are frequently updated. But this has also left supply chain executives with a very marginal bandwidth for innovation and improvisation. Besides which, a surge in workflow instances along with interdependencies that fall both within and beyond the enterprise’s purview, has only made the logistical equation for supply chain operability all the more complicated. This is to say nothing of the collateral damage done in the form of rising costs, risks, inefficiencies and many more. And supply chain experts can’t do much with traditional methodologies in such a scenario that demands pioneering change.
Organizations have deployed a string of initiatives to curb these and many other supply chain hazards. But the need of the hour goes beyond conventional supply chain metrics such as efficiency, market responsiveness or even visibility. The future of logistics beckons something more.
The boundaries between physical and digital operational frameworks are becoming increasingly less distinguishable. Business operations can now be quantitatively assessed with affordable and high precision sensor devices. Manual tasks and activities have been brought down to a bare minimum through automation. Both internal and external entities can now be merged into a macro, interconnected system.
Smart technology enabled systems provide businesses a number of advantages such as centralized control, adaptability, enhanced security and a wider range of features and functionalities.
The embedded capabilities of present day systems have evolved from an auxiliary framework that assisted in decision making to independently handling decision making without intervention. These technologies are expected to be further developed by incorporating predictive methodologies that can pick patterns and forecast trends.
The transforming terrain of supply chain networks is giving way to the emergence of operational frameworks with three intrinsic traits.
Machine Aided Approach
Automated workflows are becoming increasingly prevalent in the present day business arena. A wide array of gadgets, appliances, sensors, tags, software applications, drones and many other devices are slowly but surely replacing manual intervention across the production line.
Common segments in the supply chain framework where automation strategies are being incorporated with a lot of success include:
- Storage
- Warehousing
- Order Fulfillment
- Converyors
- Pallet Flow
- Documentation
Sensor devices, RFID tags, meters, actuators, GPS and many other devices are more frequently found across logistics networks. Real time data gathering capabilities are becoming more commonplace across these systems, thereby easing the pressure on labor intensive managerial tasks. Today, various components such as containers, transport vehicles and individual parts come with self tracking features.
Businesses need to
- Perceive how plans progress in real time,
- Keep track of their ongoing obligations,
- Monitor where they obtain their supplies from,
- Manage storage capacities and client queries
Connectivity
Technology has interlinked the various components across the length and breadth of the supply chain framework to facilitate more collaboration between various disparate and incompatible entities. Benefits include information sharing, real time process coordination, efficient supervision and many more.
There is a greater level of data exchange between different components in the supply chain. Interaction with vendors is more pronounced. Real time collaboration between different groups has allowed supply chain management teams to plan operations better and increase efficiency across workflows.
Data Driven Systems
A plethora of mechanisms are available today to process vast streams of data gathered from various workflows into a wealth of information. Entrepreneurs today can implement a process driven decision making framework in which:
- Resiliency objectives are established
- Risks and constraints are identified
- Available options and alternatives are collated
- Implementation feasibility for the options is evaluated
- The most suitable response option is selected based on predefined assessment criteria
An executive task of such a nature can take into consideration a large number of individual variables that was earlier unimaginable thanks to state of the art data gathering, analysis, interpretation, comparison and visualization tools and techniques.
Engineering these capabilities into the supply chain is a challenge in the sense that supply chain professionals are forced to stretch themselves beyond their comfort zones and don new roles and responsibilities they might not have prepared themselves for. Executive logistics professionals who have embarked on such a business undertaking must be prepared for a paradigm shift in the manner in which they confront the challenges involved in connecting business entities across the globe through a combination of technology, innovation and improvisation.
Intelligent systems allow organizations to weigh out the pros and cons of different courses of action by analyzing the combined impact of different variables and constraints through simulated scenarios. Automated decision making can allow supply chain networks to mutate and cope with business disruptions. Sustained communication channels can be used to leverage physical capabilities such as production, distribution and transportation.
Smart technology based systems are bound to gain prominence in supply chain management primarily to service the rising demands of an increasingly competitive market. There is a growing need for SCM teams to be able to anticipate what will happen and design a plan of action accordingly.
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