Cast your mind back – it’s circa mid-1990s and you need to buy a new kettle. You drive into town, park up, and trawl around from shop to shop comparing models and prices. Of course, one shop has the right model, wrong color – while another shop has the right color, but sadly the wrong model.
Finally, you settle on a particular kettle that more or less satisfies your cost, design, color, and quality preferences. All you wanted was a cup of tea, and it’s taken you all morning.
Fast-forward 25 years – you need to buy a new kettle. You simply open the internet on your phone, browse the various models on a comparison website, and then purchase one based on the price and shipping. The visibility on product, price, and shipping has empowered you to truly find the right product, at the right price.
Shouldn’t you expect this same level of visibility across your supply chain?
From a siloed supply chain…
Likewise, a lack of real-time tracking, visibility, and transparency across your organization’s supply chain can prevent you from responding quickly and dynamically to volatility or stakeholder demands – and also make it difficult to expand into new markets and geographies.
Improving the effectiveness and efficiency of your supply chain operations is all about breaking down the silos in which it operates. Although many organizations have pockets of excellence in various areas of their supply chain, they are not connected and lack any overall visibility.
While you might have visibility for a particular product or process within an individual supply chain of your organization, you might not have visibility of that product or process across product lines, divisions, geographies, and operating models of your organization.
… to a centralized control tower organization
Implementing a control tower across your supply chain operations enables you to consolidate and harmonize all of your products and geographies in one place. Acting as a central umbrella-like hub that merges data and physical material flows with your organization, processes, and culture, a control tower can improve your supply chain visibility.
Of course, this is nothing new. Control towers have always been a powerful approach to increase supply chain performance – but they have been held back by a lack of appropriate technology. Now with the rise of virtual reality, artificial intelligence (AI), intelligent automation, and robotization, control towers have the potential to contribute massively to the way you control and execute your supply chain management.
A tailor-made operating model…
Organizations have traditionally run their supply chain operations in a top-down manner. This has typically generated a set of consistent or inconsistent sales data across product lines and geographies, which is used to inform the organization how future operations of a particular product should be set up and run.
A future-ready control tower operates in exactly the opposite way and leverages a bottom-up approach:
- Visibility – first, you must ensure your data is complete, consistent, and provides the right visibility on how you operated the supply chain for a particular product. This typically involves the use of dashboards and cockpits that provide real-time visibility
- Analytics – second, you apply logic, intelligence, and analytics to your data to understand exactly how supply chain operations for that product were run. This involves root cause analysis, simulations and “what if” scenarios, as well as risk analysis and response management
- Execution – third, only once these first two steps have been carried out do you plan, produce, fulfill, sell, and deliver that product. This is underpinned by a technology backbone that connects an ecosystem of suppliers, logistics service providers (LSP), contract manufacturers, customers, and distributors.
Of course, the same principles also apply to those who run supply chains as their core business – for example, logistics service providers (LSP). A control tower can help an LSP integrate several business units, such as airfreight, ocean freight, land transport, and contract logistics. The consolidation and integration of this cross-BU transportation and warehousing data enables LSPs to proactively suggest supply chain optimization opportunities for their customers. This is nothing less than a complete revolution for the logistics industry.
… that drives innovation
To enjoy enhanced visibility across your supply chain operations, it is critical to be able to make the right decisions.
A digitized control tower not only leverages intelligent automation to reduce manual and human intervention, but also a best-in-class analytics solution to provide insights, interpretation, and anticipation of all corners of the global supply chain ecosystem. This provides real-time decision-making that keeps your supply chain delivering against the commitments you have made to your clients.
With intelligent algorithms that support improved decision-making, autonomous bots can steer and execute automated activities, reading, understanding, and sensing of language-independent information and document flows across the supply chain. In addition, by implementing a blockchain that supports and secures the interaction of your supply chain ecosystem, this will push more ownership of supply chain data to its stakeholders, contributing to increase supply chain data quality and consistency.
The good news is – a control tower concept that leverages only a part of this innovation will be able to contribute to cost control and provide a significant level of scalability for the growth to come. However, while digitalized supply chains have the potential to be entirely no-touch and fully autonomous, it is unlikely to happen within the next five years.
Implementation of a technology-enabled control tower represents a paradigm shift in the way supply chain operations are carried out, and requires a transformation mindset to be successful and reap the rewards.
Your new kettle arrived this morning. You sit back with a cup of tea and marvel at the way technology and analytics have revolutionized modern commerce. You also reflect about whether or not somebody actually touched your kettle order and its flow to become a shipment? Could implementing a control tower do the same for your supply chain?
To learn more about how Capgemini’s Digital Supply Chain Practice can implement a centralized control tower that delivers enhanced supply chain visibility, analytics, and execution across your products and geographies, contact: firstname.lastname@example.org
Read Capgemini Research Institute’s “The Digital Supply Chain’s Missing Link: Focus ” report to learn more about how organizations across consumer products, manufacturing, and retail understand the digital initiatives they are adopting, the benefits they are deriving, and the way they are transforming their supply chain.
Jörg Junghanns leverages innovation and a strategic and service mindset to help clients transform their supply chain operations into a growth enabler.