Interconnected supply chain planning enables faster, more empowered decision-making.
Supply chain organizations are now caught in the clutches of a global economy creaking beneath the weight of cargo embargoes, labor shortages, jammed ports and shipping lanes, and a pandemic that continues to evolve. Factories run the risk of closing without advanced notice. Manufacturing capacity is severely diminished. Even their ability to keep up with demand is challenged by a combination of resource material shortages and shipping and receiving delays.
While these struggles are not uncommon, functional silos are rendering current supply chain practices inefficient and cost-prohibitive to address. Sudden spikes and sharp declines in supply and demand are happening too quickly to use information that is ill-relayed, incomplete, outdated, or not received at all.
Let’s face it ‒ the traditional supply chain model is falling short. Now more than ever, the conventional silos of planning, sourcing, and procurement teams must be connected into one cohesive network.
What Needs to Change?
According to Gartner analysis1, supply chain leaders should build an organization that orchestrates end-to-end planning, mitigates or resolves risks, and supports current and future business needs. This means that all roles and activities involved in the supply chain must be centralized.
However, as Gartner noted, the definitions of the activities that should be included are unclear in most cases. For example, distribution requirement planning, capacity investments, midterm capacity planning, material requirements and replenishment planning, and product scheduling are equally shared with the finance side of procurement.
Instead of viewing these blurred organizational boundaries as “us” versus “them,” supply chain planning leaders should increase their interconnectedness with other areas of the business, especially procurement and sourcing, to maximize performance outcomes. Doing so enables these three groups to work together seamlessly toward common objectives without ignoring other business needs.
Achieving Interconnected Supply Chain Planning
By uniting planning, procurement, and sourcing data, analysis, and insight, every executive along the supply network is better equipped to seize new opportunities, sense and respond to changing market dynamics, and more profitably manage global complexity. This is where a digital supply chain platform can help.
A digital supply chain platform captures and stores crucial data in real time and layers that information on top of existing processes across the enterprise. Planning teams, regardless of their organization, can leverage embedded artificial intelligence (AI), machine learning (ML), and automation to always ensure peak operational performance.
For example, an operations planner can dig into internal capacity data stored on the cloud ‒ without tracking down a specific spreadsheet, document, or disparate application ‒ to obtain recommendations for keeping up with demand. At the same time, the sourcing planning analyst could evaluate the same information and reconcile it to help ensure the material inventory strategy accurately reflects the production needs and expectations of the broader marketplace. The procurement specialist can also use this information to negotiate pricing and standing orders with existing or alternative vendors to optimize spending while ensuring the availability and delivery of the right components.
A digital supply chain platform enables these interactions between planning, sourcing, and procurement ‒ as well as many other departments across the supply network ‒ to become more flexible, collaborative, and responsive. When all individuals have access to a single source of truth concurrently, planners can strategize together to ensure resources and materials are at the right place at the right time and deliver on customer expectations with little to no delay.
Where End-to-End Continuity Matters Most
Supply chain leaders may never be able to fully insulate their operations from disruption. But they can navigate every twist and turn with a single, unified platform like the Logility® Digital Supply Chain Platform that offers interconnected supply chain planning, sourcing, and procurement for faster, more empowered decision-making. Then, every part of the supply chain can run with a resilience that keeps competitors guessing and customers delighted ‒ from integrated business planning, product design, and demand management to inventory and supply optimization.
Logility helps organizations sense and respond to changing market dynamics and more profitably manage their global businesses to become resilient, sustainable enterprises. It’s time for a digital, sustainable supply chain. Reach out to our specialists today to discuss our supply chain solutions.
1 Gartner, ‘Take 3 Steps Before Designing Your Supply Chain Planning Organization’
11 March, 2021
Cristina Carvallo, Ken Chadwick