Resetting the Supply Chains for resiliency


Fri, 16 Oct 2020

3 to 5 mins read

Graphical representation of the flow and elements of supply chain using icons

The robustness of Supply Chains stands challenged over the last several years-compounded by the disruptive impact brought on by the pandemic. Organizations desperately need a new approach to manage risk and build resiliency. 

According to Gartner, 84% of organizations have faced varying forms of disruption – from operations being reduced to restricted and even closed.

A lot of organizations are gradually learning to deal with long, global supply chains, ever-shrinking product lifecycles, volatile and unpredictable markets, changing labor costs, advances in automation, rising protectionism, and other external shocks. If one deemed this to be a checklist on the road to 'nailing' disruption response, they are mistaken. The pandemic has put forward a clean slate by exposing what the supply chains truly lack. It is time for organizations to fundamentally reassess their approach to global manufacturing and sourcing  - it is time to start afresh.

It is crucial to understand that Supply chain resilience no longer points to the ability of managing risk. It is now in a way that the ability to manage risk should also come together as the means of gaining a competitive advantage. It is about embracing the disruption and being better positioned than competitors to deal with - and come through with flying colors. 

At a time when cost control is critical, a reimagination of supply chains can deliver the resilience and efficiency needed for the next normal — leaders need to get smart with investments to minimize costly disruptions before they occur. Here is an illustration that portrays how supply chains of certain sectors are more prone to change than others.

Visual representation of the comparison among various industry supply chains

Does this, somehow, bring about a realization that your organization is also a part of this?

If not, here is a qualifiers' list that will.

Supply Chain resiliency concerns your organization too

  1. A highly customized ERP is in place, but the outdated technology is now acting as a deterrent to incorporate IoT, MR, AI.
  2. The disparate systems and applications prevent product on-time delivery. The replication of processes is rampant, slowing employee productivity. 
  3. There is a lack of real-time visibility of day to day metrics that can help align operational business activity with corporate objectives.
  4. Adapting to ever-evolving customer demand and shopping behavior is becoming a challenge.
  5. Your organization is incompetent to capture the emergence of new shopping behavior in social and marketplaces.
  6. Your organization is working with operational efficiencies. There is an urgent need to improve operational costs/processes to offset margin shrinkage from digital competition.
  7. Your organization is dealing with the instance of loss in revenue due to transaction fraud, associated operations costs, and wrongful rejects.
  8. Suboptimal project operations and service delivery is impacting customer success and profit margins for your organization.

Building the ability to respond quickly

While the global manufacturing scenario has just begun to adopt technologies such as analytics and artificial intelligence, the Internet of Things, advanced robotics, and digital platforms, there is a still need for organizations to think beyond your four walls. Strategize on collaboration and innovation with your suppliers,  partners, manufacturers, distributors, and retailers. Further, by building access to relevant cloud-based data, organizations can make the best decisions based on real-time signals. 

Investments in supply chain resilience can deliver a 15% to 25% improvement in plant output and a 20% to 30% rise in customer satisfaction, Bain’s experience shows.

Companies need an understanding of their exposure, vulnerabilities, and potential losses to inform resilience strategies. Identifying the hidden vulnerabilities and creating a comprehensive view of the supply chain nodes are the stepping stones towards mapping the new approach. A change in approach, the implementation of transparency, the discipline of accelerating responses, changing the economics of production, and more - this will take quite a transformation.

Integrating resiliency in supply chains: Solutions overview

Connecting the entire value chain is a task, eased only with the provision of a seamless flow of data. While most companies are still in the early stages for this, their inclination to adopt 'Digital' is the clear distinctive move that can deliver benefits. The ideal implementation of 'efficiency' and 'transparency'  as digital principles is a goal in view which is fully yet to be realized. Here's how Microsoft's offerings can help your organization:

D365 Supply Chain 

Empower employees and organizations with the ability to obtain a unified view of inventory, warehouse, manufacturing, service, and logistics with predictive analytics

Dynamics 365 
Remote Assist

Empower technicians to solve problems faster the first time. Technicians can collaborate with remote collaborators using Teams to troubleshoot issues in context.

Dynamics 365

A mixed-reality application for Microsoft HoloLens that lets operators learn during the flow of work by providing holographic instructions when and where they are needed.

Power BI

Easily connect to, model, and
visualize data. Create reports personalized with KPIs. Fast, AI-powered answers to business questions

Azure Digital Twin

Create comprehensive models of physical environments and spatial intelligence graphs to model relationships/interactions between people, places, and devices

Azure IoT

Collection of 
cloud services that connect, 
monitor, and control billions 
of IOT assets. 

Microsoft Teams

Communication and collaboration platform combining video meetings file storage, workplace chats, and application integration. 

Azure Machine Learning  

Productive experiences for
building, training, and deploying machine learning 
models faster

Power Apps

Increase agility across your organization with an initiative allowing developers and non-technical users to build mobile applications.
With decades under their umbrella, the global supply and manufacturing networks managed to sustain their functioning. With modifications made now and then, organizations have managed to survive. With so much at stake - substantial investments, hard-earned experience, and relationships, thriving and winning in the new disruptive global economy will take more. So, it is time for organizations to embrace 'Digital' like never before and build supply chains that are resilient to disruption and flexible enough to capture new sources of competitive advantage.

In a nutshell, accelerating performance, embracing complexity, and fostering a healthy and effective supply chain is what is going to be the saving grace for organizations that know their hustle and like to thrive and WIN.

Next steps

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