Today’s unprecedented disruption illuminates the need for agile, intelligent supply chains that can pivot both strategically and operationally to adapt to current conditions. While supply chain leaders are no strangers to managing uncertainty and volatility, the impact of COVID-19 has exemplified the need for greater visibility across the entire supply chain ecosystem—from suppliers and manufacturers to sales leaders and retailers. As companies look to adapt to these supply chain shocks and reduce operational risk, maintaining systematic visibility while creating nimbler, more intelligent processes will be critical to success.
Establish line-of-sight visibility
With teams working remotely and global policies shifting frequently, it is more important than ever for supply chain leaders to maintain workflows and keep the lines of communication open across their broader ecosystem. Creating a connected ecosystem that extends visibility beyond the organization itself requires cloud technologies that bring data from across the network into a single, unified environment. Working from a single source of truth ensures line of sight across the entire supplier ecosystem, so if supplies are held up in a certain location and production timelines are threatened, supply chain leaders can quickly assess the situation in real time and pivot to optimize production levels and drive continuity.
Having visibility across the broader ecosystem also helps eliminate siloes internally to improve alignment across functions. Instead of making adjustments in a vacuum, supply chain practitioners can share real-time data and analytics from their ecosystem with their cross-functional partners in sales, marketing, HR and finance. For instance, if production timelines are interrupted or inventory levels suddenly drop, the supply chain team can quickly communicate those real-time changes to their sales and finance counterparts to ensure that sales strategies, revenue forecasts and cashflow projections remain accurate.
With eight factories on four continents, one worldwide leader in lightweight roofing systems needed to better plan and manage finance and supply chain operations to deliver maximum value. By leveraging a solution that facilitates the exchange of information among business units and also up to the central corporate team, the company now has a consolidated view of global inventory and production, making it easier for country managers to forecast monthly sales and purchases that drive company-wide production plans.
Leverage market-driven intelligence
Once a single, unified environment is established to house analytics and insights, supply chain leaders should assess the strength of their data and re-evaluate their forecasting and demand planning processes. In today’s complex and uncertain environment, many companies cannot rely on leveraging historical performance for demand planning and forecasting as they’ve done in the past. Instead, companies that drive supply chains using plans and forecasts that integrate market intelligence and internal and external collaboration across processes will have a clear competitive advantage.
For supply chain professionals, this means marrying internal data and existing assumptions with external insights in order to create predictive models that take into consideration a number of unique variables and input signals. For instance, as the landscape quickly shifts, it becomes critical to stay abreast of changing public health data, local and regional guidelines, and travel and trade policies, in addition to trends in buying behavior and consumer patterns. These external factors will need to be considered with real-time inputs from all key stakeholders in the supply chain—from balance of trade and manufacturer incentives to end-distributor promotions.
A clear view of the independent and dependent drivers of change will not only help improve the accuracy of forecasts, production and volume plans, but will also enable decision makers across the supplier ecosystem to be more flexible if and when those forecasts and plans are disrupted.
Taking these learnings forward
The coronavirus pandemic has accelerated the evolution of supply chain management from a back-office activity to a strategic business function critical to success. Supply chain risk is now inextricably linked to business risk, and supply chain leaders are under increased pressure to make agile, predictive decisions that help drive business growth.
As we continue to navigate these uncharted waters, having line-of-sight visibility across the entire ecosystem—from suppliers, producers and logisticians, to sales and finance teams—will be critical to ensure supply chains can remain agile in the face of change, and that operational decisions are directly linked to financial priorities. Companies must also reimagine their demand planning and forecasting processes by tying external insights to internal assessments so they can model out different scenarios and recalibrate rapidly when needed.By leveraging cloud technology to establish a single source of truth for both external and internal data and insights, supply chain leaders can quickly assess every asset, resource, risk and change from across the broader ecosystem, pivot their strategies where needed, and be more predictive as they develop plans and forecasts that will optimize the business for future success.