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Eradicating supply chain disruption and building resilience are the top priorities for supply chains today. The evident gaps in procurement and supply chain processes present a greater risk in today’s uncertain business environment.
The gaps occur in processes, information flows, and technology and result in reduced productivity.
The warehouse and transportation gap was one of the most concerning point of disconnection, so was the gap between supply chain planning and execution.
"Executives see these gaps as posing significant problems, reporting they result in higher costs, longer cycle times, and less resilience. Specifically, 58% of supply chain executives reported that the primary gaps can result in higher costs, 47% were concerned the gaps result in longer cycle times, and 42% reported the gaps negatively impact resiliency."
It is quite usual for an SCM when a chief procurement officer (CPO) and chief supply chain officer (CSCO) focus most on resilience while the mid-level and operational management are hyper-focused on their traditional measurements. These internal misalignments can also create gaps in the operational workflow.
Suffice to say that Convergence is the need of the hour. Supply chains need to better align their procurement and operations departments to address key pain points to build resiliency. A convergence of critical processes, information flows, and technologies across the organization is vital for any supply chain to be resilient.
Digital transformation of supply chains is progressing at a rapid pace amidst the recent world events, most notably the COVID-19 pandemic.
Supply chains around the world, feeling the pain of disruption, are taking bigger steps to rethink how digital, automation, and analytics technologies can be integrated into their enterprise. These efforts are typically achieved via three important objectives:
A Holistic Approach: Meaningful change does not come from the 2-3% gains scattered across the organization. It comes from 50% step-change improvements in efficiency, quality, speed, and experience in the areas that matter the most.
Expanding Capabilities and Technologies: Supply chains need to bring together capabilities from multiple groups (e.g., automation, analytics, continuous improvement) to dramatically expand the available toolkit.
Delivering the Impact: Set targets that inspire creativity and look beyond pure cost savings, and ensure every ounce of capacity created is thoughtfully reinvested or monetized systematically.
Companies have been on a journey to digitize operations for years, but there's an accelerated drive to digital transformation that could help organizations grow and work through volatility.
As the urgency to shift to digital operations is growing and as customers migrate to digital channels out of convenience, its suffice to say that those who do not embrace Industry 4.0 risk are falling behind in an increasingly competitive landscape.
Companies who are on their way to digital transformation are able to restart quickly in bigger and bolder way while others continue to struggle to deliver services and experiences effectively in the “new normal.”
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