Organizations across the world are looking for ways to revamp their businesses with renewed urgency today—thanks to the massive disruption the pandemic has caused (primarily) to their supply chains.
The pandemic has exposed the inefficiencies in supply chains that outdated technology, old business models and the reluctance of supply chain professionals to move to Cloud-based systems have caused. In an ecosystem where threats to the supply chain are not restricted to a pandemic—such as this—leaders are increasingly adopting digital capabilities to protect their supply chains from future natural/ intentional disruptions. In the ‘new normal,’ companies across industries are increasing their investments in advanced technologies—from Artificial Intelligence (AI) and Machine Learning (ML) to Blockchain and intelligent automation—to improve supply chain flexibility and adaptability to disruptions and make them resilient.
What is a resilient supply chain?
Unpredictable and unprecedented events—natural or otherwise—throw up several challenges. Organizations which confront, and overcome, such unforeseen pitfalls are able to thrive eventually. Such businesses have in common supply chains which reduce complexity and uncertainty by enabling end-to-end visibility and traceability.
The pandemic has shown us that supply chain resilience is no longer defined only as the ability to manage risk. Instead, it now refers to the ability to pivot rapidly to potential disruptions, manage resultant risks, better position the parent organization vis-à-vis competition and sometimes, even gain from disruptions.
In other words, a resilient supply chain is capable of fool-proof disaster planning (and management) because it is agile, provides real-time visibility into operations, optimizes costs and enhances productivity.
The technology behind resilient supply chains
The coronavirus crisis has proved to be the tipping point for the adoption of next-gen digital technologies capable of creating resilient supply chains. For instance – 1) Artificial Intelligence, Machine Learning and Big Data, 2) Blockchain, 3) The Internet of Things, 4) Collaborative robots (Cobots), 5) Geospatial analysis, and 6) Digital twin. Of these, the digital twin technology is one of the most innovative in supply chain management in terms of understanding, and managing, risk.
A Forbes article has described the digital twin concept in the following words – “A digital twin is a digital representation (replica) of a physical asset, process or system that can be tweaked and redesigned at will, letting businesses better understand how aspects of their supply chains interact, where possible points of failure may arise, and how different contingency plans could be implemented.”
In other words, if businesses could craft what-if scenarios for the products, facilities and processes they wanted to change in their supply chains before starting a project, then they would leverage the digital twin technology.
Digital twins are best modeled - using a varied data array - in the Cloud. In fact, experts say that Cloud-based supply chain modeling and management yield the best results when it comes to real-time decision-making and reliability assessment.
Future-proofing supply chains with Cloud technology
Like we’ve mentioned earlier in the blog, a resilient supply chain does two things – 1) reduces complexity and 2) decreases uncertainty through end-to-end visibility and traceability.
Cloud-based supply chain management integrates operations, marketing and sales teams on a single platform, helping in – 1) closely tracking a product across its complete lifecycle, 2) locating a product/ shipment during any stage of transport and 3) enabling task automation (or combination) and prioritization of slow-moving shipments as per business need.
The benefits of supply chain resilience include (but are not limited to):
- Significant operational cost containment
- Reduced lost product count (and associated revenue loss)
- Quick decisions and effective communication in case of rerouting of misdirected shipment(s)
- On-time deliveries resulting in customer satisfaction
In conclusion …
Based on the above facts, it is perhaps not incorrect to say that a digital supply chain improves transparency and responsiveness because of the near real-time interaction of processes with each another. Additional advantages of such a Cloud technology-driven supply chain include system scalability and 24x7 accessibility, immediacy in data migration, smoother onboarding of new trade partners, flexibility in inventory deployment, optimized product development and innovation, greater market expansion, and an agile operating model.