Boston Consulting Group: digital twins in supply chain
However, a digital twin allows clear visibility into the risks of a complex, interconnected supply chain...
Anticipating the supply chain is no easy task.
However, a digital twin allows clear visibility into the risks of a complex, interconnected supply chain. By enabling a company to achieve full control of the supply chain system, digital twins confer benefits beyond the end-to-end visibility provided by control towers and the predictive insights generated by planning models like demand forecasting. Supply Chain Digital takes a closer look at Boston Consulting Group’s article “Conquering Complexity in Supply Chains with Digital Twins.”
What is a digital twin?
It’s a virtual supply chain replica that consists of hundreds of assets, warehouses, logistics and material flows, and inventory positions. Through advanced analytics and artificial intelligence (AI), the digital twin emulates the supply chain’s performance, which includes the same level of complexity that drives value loss and risks.
What are the challenges of managing complexity?
Complex supply chains are more common in process industries, like chemicals, steel and mining, and in industries with interconnected production and distribution networks. In industries such as this, a single company’s supply chain consists of over 1,000 assets, warehouses and logistics flows. This complexity often leads to compromises and lost value, such as excess inventory and lost production time at critical assets. But, what causes these challenges?
Residual uncertainty and variability of demand despite advanced demand forecasting.
The unpredictability and volatility of supply.
Excessively long lead times for receiving materials from global suppliers or for shipping goods to customers, due to the geographic span of the modern supply chain.
Interconnected constraints such as warehousing and logistics limitations, stock positions and product portfolio requirements.
How do digital twins help companies?
Digital twins can enable companies to apply the insights to augment decision-making across several multiple planning horizons.
Short-term planning and execution - Digital twins can identify risks early, which allows organisations clarity before a crisis appears. This enables companies to reduce the time of bottleneck assets and to improve inventory positions.
Sales and operations planning - By simulating the execution of a specific plan, the digital twin can optimise sales and operations planning. This will enable the company to reduce and minimise losses that arise from misalignment of plans and system constraints.
Longer-term planning - A company can improve the overall efficiency of capex and optimise the setup of the entire supply chain system through understanding where the most significant bottlenecks exist.
For more information on how to conquer complexity in supply chains through digital twins, click here!
For more information on procurement, supply chain and logistics topics - please take a look at the latest edition of Supply Chain Digital magazine.
New speakers announced for Procurement & Supply Chain Live
Two leading executives in supply chain transformation have been confirmed for this year's Procurement & Supply Chain Live event.
Procurement & Supply Chain Live is the perfect opportunity to hear from prominent executives at the world’s leading procurement and supply chain businesses. The event will be streamed live from Tobacco Dock, London via the leading networking platform Brella.
The three-day show, running 28-30 September 2021, is an essential deep dive into the industry, with influential speakers sharing insights and strategies from their organisations, group roundtable discussions, and fireside chats.
We take a look at the latest additions to the already amazing lineup of speakers announced so far, and what they will bring to the flagship event.
VP Global Supply Chain at Macmillan Education Ltd
Shaun Plunkett has over 30 years of supply chain leadership experience in FMCG, entertainment and media sectors, supporting multi-billion euro businesses including Universal Music, EMI, Sony Music, Harper Collins and Associated British Foods. He has a track record of successfully delivering transformational change coupled with award winning operating models and developing and coaching global teams. Plunkett says that challenging the status quo is at the heart of what drives him on a daily basis - and encouraging others to continuously push the boundaries.
Read more about Plunkett’s involvement in Macmillan Education’s supply chain transformation HERE
Digital Transformation Lead, Oracle UK and Board Member, CILT at Macmillan Education Ltd
Vikram Singla is digital transformation director at Oracle, UK. He helps supply chain and finance business leaders leverage technology to deliver meaningful business outcomes for their organisations. He also serves on the board if CILT (Chartered Institute of Logistics and Transport) – UK and is an Honorary Visiting Fellow at Anglian Ruskin University. Singla has more than 25 years’ experience in the technology sector, and in global supply chain transformation, including deploying business transformation programmes for Fortune 500 firms. In his spare time, Singla is a passionate brand ambassador for Cancer Research.
Plunkett and Singla join a growing line-up of speakers, including: Sheri R. Hinish, IBM; Robert Copeland, G4S; Daniel Weise, BCG; Mark Bromley, Mastercard; David Loseby, Rolls Royce; and Ninian Wilson, Vodafone Procurement Company.