Fixing Our Broken Supply Chain
Supply chains are long overdue for a complete overhaul. This was made abundantly clear amid the COVID-19 pandemic.
The recent fracturing in the flow of products has shed light on a broken system's vulnerabilities. Clearly, transparency and efficiency are achievable only when we have automation tools in place to maximize intercompany data. Only then will we see the resiliency required to navigate fluctuating market conditions.
So, what exactly is the problem?
Supply chains are plagued by digital silos connected by manual processes, such as emails, spreadsheets, and one-off file transmissions. As companies attempt to streamline their supply chains in new, ever-changing market environments, the COVID-19 crisis has highlighted these gaps. Although we saw this impact in essential sectors first, such as medical equipment and food, the COVID-19 crisis will have long-term implications across supply chains everywhere.
Exacerbated by current conditions, three vulnerabilities have come to light:
1. Fragmented technologies that cost companies time and resources. Even though few technologies are in place to track their journey end to end—let alone to optimize for speed, accuracy, and efficiency—component parts and the data associated with them need to move through numerous global parties. This disparate system creates enormous friction and escalates unnecessary costs, including order errors and slower inventory turns.
2. Lack of transparency reveals unreliable available inventory. Accessing reliable information about available inventory can be incredibly challenging as conditions rapidly change, fluctuating consumer demands.
3. Multiple-sourced data means room for error. Organizations continuously invest efforts into synchronizing their internal systems, but this process often breaks down across supply chains, where numerous organizations use different systems.
What's the Solution?
We need to unify the data silos from supply chains into one intelligently coordinated fabric, including data from legacy systems. Digital silos today collectively cost companies billions of dollars.
Moving forward, data needs to be able to flow through supply chains quickly and accurately, so all parties can have information that is synchronized, updated, and complete. Only then will enterprises be able to gain valuable insight and rapidly iterate without breaking under the strain of fluctuating market conditions. More informed decision-making comes from more accurate, real-time data, which a coordinated supply chain can provide.
Unprecedentedly, the COVID-19 crisis is forcing companies to compress 10 years of supply chain transformation into six months, and they are urgently looking for innovative platforms that provide a greater return on investment than enterprise resource planning system upgrades.
Companies that partner with expert organizations can move faster and serve their customers better by automating their intercompany data flows. They must collect and transform multiple sources of data, such as product availability, product shipment, compliance, and regulatory standards, into a unified, real-time data layer that synchronizes different systems.
With increased data coverage and comprehensive information, vendors can make more informed decisions, better managing product flows with greater visibility and speed across their supply chains. By automating supply chain data collection, supplier and customer data can be made smarter through the use of machine learning to integrate product data from various sources, both within and beyond a company.
COVID-19 is a catalyst for necessary change. Our collective global supply chain disruption makes it clear that the time to bring transparency and efficiency is now.