With access to the right data, it’s possible to work out in advance how a supply chain will function … [+]
As organizations across sectors gain a better grip on their new business as usual, many are beginning to turn their attention to bouncing back and to how they can recover a sense of operational normality as quickly and fulsomely as possible after this pandemic is finally behind us.
For manufacturers, the challenge is acute. Having rightly invested in the critical human challenges of keeping their workers safe and protected, many will soon be tasked with ramping back up in a world where employees and customers are likely to return in waves, and where supply lines at home and abroad are still in aftershock.
As they do so, many will find their focus falls on meeting the needs of customers to get vital revenues flowing back into their business. This is entirely sensible and will be key to getting their company – not to mention the US manufacturing industry as a whole – moving again.
But, in fact, customers are just part of the story right now. Operationally speaking, it’s critical that manufacturers also give serious thought to their supply chain and, in particular, the question of how it can be made more intelligent and resilient in the long term. For many, the answer lies in data.
Currently, the process of understanding and visualizing supply chain networks takes too long, and is usually based on historical information. This means that, for most companies, forecasting tends to be a reactive rather than proactive discipline. A piecemeal summary of the past as opposed to an intricate and directive picture of the future. Yet, with access to the right data, it’s possible to work out in advance how a supply chain will function in a far more precise and robust way.
A dedicated platform
To be clear, this isn’t about generating more data; there’s plenty of that available already, maybe even too much. Rather, it’s about manufacturers managing existing information to make smarter decisions and take more clearsighted action. As for how, the best way is to establish a dedicated supply chain intelligence platform – something very few companies currently have but that could truly transform their ability to scenario plan effectively.
By using a set of analytics tools to capture, combine and prioritize data from various internal and external sources, a supply chain intelligence platform lets manufacturers more accurately foresee potential issues across a wide array of geographies and sectors. This, in turn, means they can prepare ahead of time and, when the disruptions hit, ensure they’re better positioned to ride out the storm and accelerate the recovery process afterwards.
The evolving challenges presented by the coronavirus are a perfect case in point – and should act as powerful inspiration for any manufacturing company not currently using a supply chain intelligence platform.
Take, for example, a global mining organization. A supply chain intelligence platform can help them understand how new government restrictions on border movement due to the COVID-19 pandemic will impact the supply of materials that are essential to day-to-day business, flagging any new or expected issues in different locations. A simple map interface can display these issues alongside their supplier list, allowing analysts to quickly identify and investigate those most under threat.
Crucially, this also includes combining real-time information about vendors, shipments, and stock inventory. So, if material X is running low and set to run out within the next month, the organization can consider this alongside the risk level in the relevant geographical area. If the system predicts a shipment may not arrive before the current stock is exhausted, the analysts can work with category managers to identify alternative suppliers and get a plan in place in advance.
As this example shows, such a supply chain intelligence platform can make a clear, immediate, and lasting difference for individual companies – both operationally and financially. But where that impact can become supercharged is when it’s used to drive getter visibility and collaboration across a manufacturer’s entire ecosystem of suppliers and partners.
Imagine, for example, the value of being able to seamlessly and instantly combine up-to-date information around a supplier’s component availability with customer buying behavior data from a distributor. Unquestionably, this kind of insight would make it far easier for partners throughout the value chain to balance supply/demand and meet customer needs more effectively. Not to mention ramp up more quickly after a crisis like the current one.
Tomorrow’s success starts today
Of course, this isn’t to suggest that manufacturers will be able to get to a fully fledged supply chain intelligence platform within the next two months. Not with so many challenges on the table already. But with Covid-19 forcing companies to reset, now is the time to invest in transformations programs that set them up to thrive in future.
Yes, changing how they use data to visualize and bolster their supply chain networks can’t happen overnight. And, yes, the real rewards will come further down the line. But for any manufacturers looking for success after the coronavirus, a supply chain intelligence platform is the perfect place to start.
The views reflected in this article are the views of the author and do not necessarily reflect the views of the global EY organization or its member firms.