Your ERP system is not the right technology for a sustainable supply chain.
- A digital supply chain platform is essential for a sustainable supply chain.
- While your ERP may run your internal business, it’s not the right choice for the complex tasks a sustainable supply chain requires.
- A purpose-built digital supply chain platform provides the data, visibility, and analysis needed for accountability all the way through the supply chain.
- It provides the means to achieve the three pillars of sustainability: economic, social, and environmental responsibility.
- Supply chains need the functionality that only a digital supply chain platform can provide – connecting planning and execution with strategic outcomes across the entire enterprise.
Digital is definitely the new normal for most business functions as technological advances have enabled more efficient gathering and use of data to improve process management and enable better overall decision-making. For today’s sustainable supply chain, a digital supply chain platform is a must.
Just six years ago, this was a technology on the rise, empowering companies with visibility through the ability to better identify the sources of raw materials and more thoroughly vet suppliers. Today, it is intensifying accountability for both the social and environmental impacts of their supply chain.
To truly manage your entire supply chain, including achieving goals of authentic transparency and sustainability, the technology platform you use is important. While your enterprise resource planning (ERP) system is likely the heart and soul of most of your internal processes, it’s not the best choice for highly complex, collaborative, and relationship-based processes such as supply chain management (SCM).
You need a specialized solution – one that follows best practices, is easy to use, and improves sustainability. Let’s explore how to achieve your goals with the right technology for a sustainable supply chain.
3 Reasons Your ERP Can’t Deliver a Sustainable Supply Chain
Let’s first define what a sustainable supply chain is. Conventional supply chain management focuses on speed, cost, and reliability. A sustainable supply chain includes the stated goals of maintaining corporate responsibility by supporting the business’s environmental and societal values, including climate change, water security, deforestation, human rights, fair labor practices, and corruption.
Your ERP does a great job in accounting, budgeting, financial management, and reporting — things that are essential for running your business day to day. However, these systems are built for workflow optimization to manage internal, transactional data, which is of no help to your supply chain management.
Let’s look at a comparison of functions between ERP and SCM:
1. The nature of the platforms –
- ERP is transactional: This means ERPs stand out when it comes to recording daily transactions and offering easy access to that information.
- SCM is collaborative: With an SCM platform, workflows are collaborative, with the ability to build networks of all of the interconnected stakeholders throughout the supply chain.
2. They handle data differently –
- ERPs use internal data: They record, process, and report on data that is well-understood, internal company information.
- SCM manages disparate data: An SCM platform integrates data from multiple sources, including your ERP, and uses artificial intelligence (AI) to analyze and make predictions from that data.
3. They manage different processes –
- ERPs integrate internal functions: Your ERP is a standout when it comes to integrating things like resource planning and finance with other business units such as sales and your customer relationship management (CRM) platform.
- SCMs provide the complete picture: The focus of an SCM platform is the supply chain, including sourcing, buying, planning, pre-production, production, and quality management, as well as compliance and sustainability.
Simply put, you need the right tool for the job.
The Technology You Need for a Sustainable Supply Chain
Digitizing your supply chain operations will transform your business operations. A digital supply chain platform will provide enhanced communication, quicker decision-making and issue resolution, delayed mitigation, partner connections, and improved visibility that gives you a competitive advantage.
Also, you know that when it comes to sustainability, accountability is vital. A digital supply chain platform with a corporate responsibility solution makes suppliers, manufacturers, logistics, and other supply chain stakeholders more accountable through centralized reporting and data. This provides the visibility you need to ensure that everyone in the global supply chain is meeting their commitments.
This increased visibility also helps drive the sustainability initiatives that consumers demand, because you can prove that you are sourcing and manufacturing goods in a responsible manner.
A digital platform increases sustainability in three key areas:
1. Economic sustainability
- Improved and accelerated decision-making
- More effective inventory deployment
- Assets more efficiently utilized
- Increased fulfillment rates and improved customer satisfaction
2. Environmental sustainability
- Reduced energy consumption and carbon footprint
- Improved effluent and waste
- Product more easily traced and recovered
- Increased recycling
- More efficient use of raw materials
- Increased utilization of return and restore
3. Social sustainability
- Conformance with labor, safety, and security laws and standards
- Maintenance of accepted standards of fair trade and social equality
- Better delivery and availability of products
- Automation of routine and mundane tasks
A sustainable supply chain means you have the insights you need to stay one step ahead. This means you can be proactive instead of reactive, seize new opportunities, sense and respond to fluid market dynamics, and more profitably manage your global supply chain.
Your ERP just isn’t up to those tasks. Business leaders are realizing that to navigate the complexities of global economic disruptions, their supply chains need the functionality that only a digital supply chain platform can provide – connecting planning and execution with strategic outcomes across the entire enterprise.
The Logility® Digital Supply Chain Platform
The Logility platform accelerates the sustainable digital supply chain by leveraging data-driven tools such as advanced analytics and AI to empower your business with greater visibility. This allows more accurate planning, accelerated cycle times, improved precision, and increased operating performance. It’s the only way to ensure you’re meeting global standards of corporate responsibility.
We help organizations sense and respond to changing market dynamics and more profitably manage their global businesses to become resilient, sustainable, and responsible enterprises. It’s time for a digital, sustainable supply chain. Reach out to our specialists today to discuss our supply chain solutions.