Cloud software: Managing what you can't see
Written by Patrick Lemoine, E2open (pictured, right)
It’s no wonder that brand owners are losing billions of dollars each year due to poor supply chain visibility. You can’t manage—much less profitably manage—what you can’t see. And in today’s circuited and circuitous global marketplace, that boils down to a lot of blind spots, information gaps, and missed opportunities to keep your business ahead of the curve.
With margins and service levels hanging in the balance, enterprises simply can’t afford to keep customers waiting as they scramble to correct the errors created by poor forecasting or inflexible supply chain operations. The ability to respond quickly and intelligently to unexpected changes in demand is paramount to sustained success in this new environment.
The challenge is that, for the most part, supply chain technologies haven’t kept up with the changing needs of today’s global companies and consumers: namely, access to accurate, timely information; the ability to collaborate and make fast decisions across multiple geographies of trading partners; and advanced business analytics that help you work smarter and develop more strategic partnerships.
Poor visibility across the make, source, and delivery processes of multiple product offerings is the root cause of many of the most common supply chain challenges. A significant number of global enterprises are still struggling to move beyond a handful of one-to-one connections with their most strategic partners, making it nearly impossible to synchronize systems and processes to achieve a true (that means timely and complete) picture of end-to-end operations.
To succeed in a world where demand volatility is the new norm, brand owners must shift their focus away from vertical planning and decision making based on static information inside the four walls of a company. Imagine a supply chain in which you are able to: (1) identify opportunities or problems as they arise (e.g., a demand spike or a part shortage); and (2) work collaboratively with partners to respond in real time.
How much could you improve your efficiency and bottom-line profitability by being able to determine the best outcomes within the timeframe it matters most? What if you could make a strategic decision, based on complete information, faster, to get a jump on your competition? What impact would this level of intelligent responsiveness have on your customer service levels?
The good news is that a new class of supply chain solutions is finally making it possible to start answering these questions thanks to cloud computing. By providing a shared space for communication, collaboration, and business process execution, a cloud-based platform allows trading network participants to see, share and act on the best possible information—in real time, when plan deviations can still be turned into cost savings or revenue opportunities.
Cloud-based supply chain solutions are changing the game from the inside-out, making it possible to bridge multiple tiers of information silos and process gaps with a ‘single version of the truth’ that is accurate, intelligent, and actionable. They are also introducing a level of operational efficiency, flexibility, and scalability never before believed possible.
That’s really just the tip of the iceberg—that is to say, cloud—but the next chapter will have to wait until I tackle the question: How do I manage demand I can’t predict and supply I don’t control? Stay tuned.
Biden establishes Supply Chain Disruptions Task Force
The US government is to establish a new body with the express purpose of addressing imbalances and other supply chain concerns highlighted in a review of the sector, ordered by President Joe Biden shortly after his inauguration.
The Supply Chain Disruptions Task Force will “focus on areas where a mismatch between supply and demand has been evident,” the White House said. The division will be headed up by the Secretaries of Commerce, Transportation, and Agriculture, and will focus on housing construction, transportation, agriculture and food, and semiconductors - a drastic shortage of which has hit some of the US economy’s biggest industries in consumer technology and vehicle manufacturing.
“The Task Force will bring the full capacity of the federal government to address near-term supply/demand mismatches. It will convene stakeholders to diagnose problems and surface solutions - large and small, public or private - that could help alleviate bottlenecks and supply constraints,” the White House said.
In late February, President Biden ordered a 100 day review of the supply chain across the key areas of medicine, raw materials and agriculture, the findings of which were released this week. While the COVID-19 health crisis had a deleterious effect on the nation’s supply chain, the published assessment of findings says the root cause runs much deeper. The review concludes that “decades of underinvestment”, alongside public policy choices that favour quarterly results and short-term solutions, have left the system “fragile”.
In response, the administration aims to address four key issues head on, strengthening its position in health and medicine, sustainable and alternative energy, critical mineral mining and processing, and computer chips.
Support domestic production of critical medicines
- A syndicate of public and private entities will jointly work towards manufacturing and onshoring of essential medical suppliers, beginning with a list of 50-100 “critical drugs” defined by the Food and Drug Administration.
- The consortium will be led by the Department of Health and Human Services, which will commit an initial $60m towards the development of a “novel platform technologies to increase domestic manufacturing capacity for API”.
- The aim is to increase domestic production and reduce the reliance upon global supply chains, particularly with regards to medications in short supply.
Secure an end-to-end domestic supply chain for advanced batteries
- The Department of Energy will publish a ‘National Blueprint for Lithium Batteries’, beginning a 10 year plan to "develop a domestic lithium battery supply chain that combats the climate crisis by creating good-paying clean energy jobs across America”.
- The effort will leverage billions in funding “to finance key strategic areas of development and fill deficits in the domestic supply chain capacity”.
Invest in sustainable domestic and international production and processing of critical minerals
- An interdepartmental group will be established by the Department of Interior to identify sites where critical minerals can be produced and processed within US borders. It will collaborate with businesses, states, tribal nations and stockholders to “expand sustainable, responsible critical minerals production and processing in the United States”.
- The group will also identify where regulations may need to be updated to ensure new mining and processing “meets strong standards”.
Partner with industry, allies, and partners to address semiconductor shortages
- The Department of Commerce will increase its partnership with industry to support further investment in R&D and production of semiconductor chips. The White House says its aim will be to “facilitate information flow between semiconductor producers and suppliers and end-users”, improving transparency and data sharing.
- Enhanced relationships with foreign allies, including Japan and South Korea will also be strengthened with the express proposed of increasing chip output, promoting further investment in the sector and “to promote fair semiconductor chip allocations”.