Supply chain evolution refers to the process of continuous change and development in supply chain management practices over time. As market dynamics, technological advancements, customer expectations, and business environments change, supply chains must adapt and evolve to remain efficient, competitive, and responsive.
Setting Ambitious Goals to Develop Supply Chain Excellence
As we start to lengthen our stride into 2023, we all wonder what sort of business year it will be. It is clear that disruptions will carry over from 2022 in the form of inflation and geo-political conflicts but there is also some optimism for global economies and increasing stability in daily life. However, even positive changes can bring disruption and the general trend is that manufacturers still feel that they lack the agility and visibility to help prepare for the future.
DELMIA regularly attends and speaks at annual supply chain trade shows but every event tends to have the same three group of companies in attendance:
- The (small) group that have now grown to a point where they are just starting to understand that they cannot manage their supply chain operations manually with spreadsheets.
- The (much smaller) group that can showcase their supply chain maturity and excellence.
- The (largest) group that are in limbo. They understand they have a problem but have consistently struggled to make a tangible difference to their overall performance and effectiveness.
This third group is concerning. Few companies here manage to ascend to supply chain excellence and (more often) find themselves in financial jeopardy. The level of disruption and change is affecting this group of companies the most and the attrition rate is only likely to become greater in the future. Obviously, no one desires to stay in this limbo state, so why do so many projects and change initiatives fail or have very little tangible impact?
I believe that one major reason is that companies do not think big enough when scoping and planning transformation. In previous decades, adding point technology and appointing industry “tsars” had a larger impact because the rate of change and disruption was less. Now, it is no longer sufficient to simply forecast better, implement a big-data strategy, or have a supply chain “swat” team. So many supply chain projects fail because the problems of today are not the same as yesterday; companies need to evolve. They need to evolve their thinking, their technology and, most importantly, their goals and expectations.
For any company, nothing about this evolution will be a simple proposition. It requires vision, support, endurance and commitment to setting an end-goal that may take years to achieve. It is a journey for sure but one that is well worth taking and (as long as the journey is well planned) one that will pay dividends along the way.
This year, DELMIA will be releasing a number of articles and surveys on supply chain resiliency and sustainability in an effort to provide some insights into the type of evolutionary steps that companies can take. These insights will range from holistic planning of the enterprise and value network, to meaningful use of artificial intelligence and machine learning, and to collaborative operations between typically “walled-off” internal organizations. We will also be showing some of our leading planning and optimization solutions that help enable transformation.
You can already listen to our first set of thoughts as presented in the webinar hosted by Supply Chain Management Review but look for our upcoming eBook later this quarter and a unique supply chain industry survey planned for Q2.
During 2020, everyone became painfully aware of the fragility of most supply chains. What has been worrying since, is just how few companies have learnt the lesson and made true transformational changes to prepare for the future. Large company “momentum” plays a role in inhibiting change for sure but we are now three full years into the new age of constant disruption. This year needs to be the year of evolution so that we see more showcase companies at events and less bad business news.
If you are ready to talk about supply chain transformation, we would love to hear from you and share our expertise on taking the journey. Learn more about our supply chain solutions or connect with us online.