Agility has been a huge focus for organizations as we enter unpredictable waters of the current and future economy. Increasing customer expectations, global business challenges and digitization are greatly impacting how we market and sell our products and provide a high level customer experience through the supply chain. And agility is critical to sustained business success.
However, as our supply chains have grown and our global footprints have gotten larger, complexity and rigid processes have made agility increasingly difficult. As strategies change on a dime, agility in the supply chain is needed, however, to achieve agility we can’t just rip out current systems and replace them with better but similar functionality. We don’t have the 1+ years to make that change!
Instead, it means looking to build agility into how our existing supply chain operates, providing flexibility on how we use current and future partners and making quicker real-time decisions on our supply chain processes.
When we look at agility in the supply chain, the following areas are where successful organizations focus in maintaining the flexibility needed for an agile supply chain.
End-to-End Supply Chain Visibility that is Actionable
The key to agile supply chains is accurate data that is real-time. This enables for better decision making across all functions and most importantly, in relation to ensuring the end-to-end supply chain for each order leads to OTIF orders.
When we think about what this means, it’s threefold.
- First, the data needs to be accurate, real-time but also in a single view. Supply chain control towers can help to connect your systems and parties to provide a single source of truth for every order to do this.
- Second, the data needs to be available to all parties and systems for better collaboration between them. This means better integration to support multi-enterprise business networks for your supply chain ecosystem that ensures all parties are working off the same important data.
- Third, you need the data to feed your real-time execution planning systems that provide supply chain orchestration. This enables you to more effectively automate and ensure compliance across all your supply chain functions for better and more cost efficient results.
Consideration of All Constraints for Each Order
This is often overlooked but when we think about ensuring perfect orders in our supply chain, the key lies in our ability to digitize and understand the real-time constraints that we have in the supply chain to better execute on each order.
This means having a system that can take in all of this constraint information including SLAs, delivery dates and times, activity costs, delivery costs, internal capacity for each function, external capacity of partners, inventory across the supply chain network and lead times for all functions in order to best execute on your increasingly high volume of orders coming in.
While your legacy systems will evaluate a few of these constraints in decisions, I can’t emphasize enough the value of including all of these constraints into your decision-making from an order perspective. This can lead to better usage of the inventory across your network to prevent missed sales opportunities or late delivery, quicker exceptions management with granular order flow transparency and improved real-time outsourcing when capacity is reached internally.
Many to Many Order Optimization
Continuously optimizing the real-time execution of one order is difficult for most supply chains today, optimizing for all orders in concert is even more difficult. When we think about order management solutions, this is a critical part of optimizing the supply chain.
The order flow determined by supply chain orchestration will optimize the flow for that moment in time based on all the constraints and data mentioned above. However, the true optimization happens in correlation with other orders (both those currently in process and future orders that come in soon after). Any good software will take current and future orders into consideration as it plans out and optimizes your end-to-end supply chain to most efficiently do real-time planning and execution of your orders. This might mean order splitting and consolidation, usage of specific vendors based on order criteria, re-planning shipments when new orders come in and many other combinations of events and optimizations. Solutions such as supply chain control towers can help to effectively find efficiencies in how your orders can most efficiently be executed in relation to one another.
Agility through Technology Innovation
To be truly agile in the supply chain, you need to think strategically about your internal investments, partnerships and your technology foundations. Your legacy systems were put in place for a reason and are still crucial to your supply chain success. However, as you look to build agility into your operations, they leave a lot to be desired with supply chain visibility, collaboration and end-to-end, many-to-many order decision-making. Supply chain orchestration is an emerging category designed to connect these systems, build a common and accurate data set and take intelligent action on this data to ensure the best customer experience possible in the most efficient way possible. Don’t rip up your technology foundations but think about extending them with innovative technology.