The pillars of Supply Chain 2.0, according to Accenture research are the following:
The key to achieving these is intelligent automation of your supply chain. With earth-shattering changes that are taking place around us such as the big boom of e-commerce, customer expectations reaching a peak, the industry redefining new levels of quality of service, etc., organizations are on the brink of reinventing the entire manner in which traditional supply chains were run.
Automation – Key driver of change in the supply chain
To help them achieve these 4 strategic goals, automation is the first key step. Conventional supply chain operations are error-prone, sluggish and rigid. In an environment when the changes around are so rapid and supply chains need to respond to global changes in the quickest possible manner, automating them is a sure way to establish that execution of changes is quick across multiple legs and instant.
In a manual system, change management is not just a time-taking affair but also an expensive one. The time lost in rolling out these changes while inefficient processes that would continue to run, accumulates wastage owing to inefficiencies. The only way to minimize this bit is through automation.
The other scenario is when an automation exercise is a 2-year project. It is understood that not all supply chains are lean and easy to automate. They come in all sizes and shapes, not to mention the complexities and criticality to business continuity.
An automation solution that promises a shorter time to go-live is most desirable in this case. This is one way to ensure that your preparedness for supply chain 2.0 is in better shape than to invest 24 months in an automation journey. The rate at which supply chains are changing is so rapid that at the end of the automation exercise, one could be in a position where some legs of the journey may have to be rendered rather obsolete and that defeats the fundamental purpose of embarking on such a journey.
One of the dilemmas that organizations face while embarking on supply chain automation is how much of it to build in-house and how much of it to buy from outside. It could be point products or customizable solutions.
The cost factor here is secondary and not the key driver of decision making. It is more on the lines of process understanding. Irrespective of who the vendor is, no one knows supply chain better than in-house stakeholders that are a part of it. With their deep knowledge of the spikes and chains of how one leg of the supply chain affects subsequent legs, they are the best people to take a call on how to go about with the right set of bells and whistles in place while automating the supply chain.
The only problem here is, while this approach offers depth to the entire system, it puts scale and span for a toss.
Often, this in-house automation can solve a problem for the time being in the best manner possible (arguably so). Yet, when it comes to scaling it, this takes a severe beating. In-house teams, essentially supply chain teams, and not engineering teams that build scalable solutions to solve a problem. Hence, factoring in scale at the time of automation is a key element of success in the 2.0 initiative.
With the advent of new technology such as machine-learning and artificial intelligence in the supply chain, a certain degree of intelligence in the supply chain is not just a good-to-have but a must-have in order to get a competitive edge.
Customers expect predictability from systems and it helps a long way in ensuring that systems are not always on catch-up mode or reactive.
In addition to predictability, in-built optimization is where intelligent systems are headed. Large decision-making in the supply chains is empirical and quantitative which drives experience which is largely qualitative. In this scenario, the ability to configure thresholds, alerts, and rules-based on thresholds assures a certain level of a reasonably self-optimized system in place. Achieving this is an essential step towards supply chain 2.0.
A connected infrastructure, where different systems work in tandem with each other is the way to go in supply chain advancement. Siloed structures are ineffective and limiting in so many ways that integrations are necessary to quickly scale operations and work with multiple IT systems and 3 PL partners. This offers flexibility and agility which are key to supply chains in 2020.
In addition to the integrations that are needed to liaise with multiple IT systems, there is also a need for end-to-end control and visibility. This is achieved through digital control towers that offer an at-a-glance view of the entire supply chain end-to-end. Not only does it help in monitoring the supply chain but also control it.
In order to take the big leap into supply chain 2.0, enterprises need to embark on a scalable automation journey that adds efficiency, agility, and transparency into the system. This makes the supply chain more adaptive to change and sustainable in times when turbulence is the new normal and the future is all about automated supply chains.
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