Technology Fostering Resilient Supply Chain Transformation
Published on : Tuesday 03-11-2020
By improving the visibility of disruptions, technology could also contribute to improve resiliency and efficiency within the supply chain, asserts Moorthy Ramasamy.
Supply chain disruption has been consistently increasing in the last decade YoY. Even with 68% of the major organisations reporting their supply chain disruption, the number is increasing, one could assume that the disruptions are significantly higher with the inclusion of the non?reporting organisations as well. The impact due to supply chain disruption in any organisation will vary from a few thousands of dollars to millions of dollars. In recent times, two major factors have emerged as major contributors to the supply chain disruption – the first one being health and wellness, and the second being cybersecurity breaches. A recent report on supply chain disruptions states that these two factors contribute to more than 55% of the total supply chain disruptions. The recent Covid?19 impact will fit into the first health and wellness category and one does not have to elaborate on its impact.
The latest chain of events has exposed the inherent weakness of international supply chains. Covid?19 along with notable cyber events around the world highlighted the highly interlinked supply chains that have several points of failure. Now, business leaders are also realising its rigidness with absorbing delays and disruptions that it was expected to be.
Over the period of last decade, most of the organisations have focused on streamlining their supply chain to ensure maximum optimisation and reducing cost to manage and maintain their supply chain. Current situations exposed the inherent weakness of this over optimisation. In hindsight, business leaders consider the requirement of a supply chain to exhibit resiliency even in periods of uncertainty. While several options are considered, the worst would be to recreate the conventional methods of supply chain with multiple redundant features to make it flexible. This will also contribute to inefficiencies. Hence a resilient and cost?effective supply chain is the need of the hour.
In order to create a resilient supply chain, we will have to bring in the right combination of expertise, people, technology and solutions. Leveraging supply chain technology drastically contributes to improving end?to?end visibility, resiliency and efficiency within the supply chain networks. While the current supply chain reports are observed, reported and analysed in TIER1 suppliers, transparency provided by the technology exposes any disruptions that is being experienced beyond TIER1 in TIER2 and TIER3 layers of the supply chain.
When it comes to technology, there are several impacting technologies that are continue to evolve. Some of the latest advancements in digital technology and automation can be categorised into three main areas. With respect to supply chain automation, there are several companies that provide RPAs and configurable workflows. These automation technologies are used to streamline routine, operational tasks that will liberate the workforces to engage on strategic, high?value activities. This could increase time available to build relationships between suppliers, customers and partners. Automation technologies create a software robotic approach leveraging a set of rules and conditions to automate tasks, processes and gather track and trace data that are the vital requirements for a supply chain management. These techniques can significantly improve the real time efficiency when the number of data sources and a humongous amount of data need to be processed.
While automation helps to accomplish tasks with less manpower, digitalisation technologies such as artificial intelligence, machine learning and cloud computing will help to improve supply chain enhancements to the next level. These technologies will help to ensure accuracy of business judgement as uncertainty and unpredictability increases. These technologies are no longer an option and they have become a necessity, otherwise, the organisation will face drastic consequences that risks their survival in today’s world.
With companies collecting several kinds of information and are using passive data logger, they often do not use them for their supply chain improvement. With data being siloed in several platforms, it poses a significant challenge to be efficient. Digitalisation technologies solve the problem by integrating the data from various platforms in a conventional organisation to a digitally transformed organisation that can render the real?time supply chain simulation and contribute to improve planning for a better predictive outcomes. There are several algorithms that could cater to the need of the organisation and customise the outcome of the predictability. This leads to a more responsive company based on market requirement and customer variability. This will add significant value for all the businesses that are in any specific supply chain.
The last part of this digital puzzle would be IoT devices. While automation brings in process efficiency and digitalisation brings in intelligence, IoT can bring in real time data. Real time data is critical to base your judgement on any critical process. Basically, digital supply chain is basically a dynamic engine with these three components tuned to the required extent to provide optimal results to the organisations. As of today, there are no digital supply chain templates that could be used across all the companies. However, organisations have to evolve their own digital supply chains to suit their requirement and adapt to their strategic objectives.
Such a transformation will create a closed loop, real time technology with a transparent dashboard to the business leaders. By improving the visibility of disruptions, technology could also contribute to improve resiliency and efficiency within the supply chain. It will also increase collaboration and reduces bottlenecks significantly adding value to the organisation. In short, organisation can adopt these technologies for their better tomorrow without having to change their underlying supply chain.
Moorthy Ramasamy is an Automation Expert with more than fifteen years of hands-on experience in automation industry. Currently his focus areas are digitalisation techniques, methods that contribute to value addition and creation in the industry. He blogs about several industrial trends on Automation, AI, Procedural Automation, Robotics, Digital Transformation, Networks, Supply Chain, Asset Management, Data Analytics, IIoT, Wireless Communication, and Cybersecurity, among other topics. He actively participates and contributes to IEEE researches in his focus areas. Moorthy also contributes to the society by coaching young engineering talents, peer reviewing articles, consulting engineering projects in India and overseas. He can be reached by mail at: [email protected]
