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For many years, multi-national enterprises have had to deal with disruptions caused by climatic, political, economic, and biological events; with regulatory changes; with sudden demand fluctuations; and with stockouts and high inventories. In recent years, though, they’ve been joined by other challenges. For instance, it’s a given that nowadays, customers are more connected, and they expect greater and more instantaneous choice, and a more personalized service offer.What’s more, lockdown has altered buying behavior and hence sales channels. With the growth of direct-to-consumer channels and of subscription services, fulfilment models have often had to morph into something that is certainly new, and probably more complex. It has been disruption on a scale that has not been seen before.If organizations are to meet and manage these challenges, they need fundamental and sustainable transformation – a shift to a supply chain planning model that is comprehensive, smart, and frictionless.
The defining principles of touchless supply chain planning include:
A frictionless planning model with these characteristics provides competitive advantage. Operationally, it enables organizations to work seamlessly with multiple providers and partners at an optimum cost, and to make the most of the best resources on a global scale. Information and physical inventory flow seamlessly between them, and their interactions are augmented by artificial intelligence.
The workforce is digitally augmented too: the majority of processes can be run concurrently without manual touch points, leaving planners to focus on exceptions, where their own direct input adds most value . For example, they can take advantage of predictive analytics to identify and act upon risks and opportunities, harnessing data that can now be drawn from across the extended enterprise.
But that’s not all. While the operational benefits are both considerable and welcome, the real differentiator in touchless supply chain planning is the effect it can have on customer relationships. When processes are seamless, and when information drawn from across the supply chain is shared, interpreted, and actioned, organizations can work with their customers to create personalized experiences that meet their individual needs and expectations, and fulfilment models can flex around customer requirements to make things happen.
Frictionless planning models make it possible to work in a radically different way. Let’s make some comparisons.
Traditionally, processes are siloed, focus is mostly on the here-and-now and if things go wrong, the firefighting can be considerable. But with frictionless planning, most of the time-consuming processes are touchless and continuous, allowing the focus to switch to the medium to long term. Also, because data can be drawn from across the business, insights can deliver long-term value, and assist strategic decision-making.
In contrast to traditional approach, touchless planning is driven by an AI-augmented workforce, where the planning architecture takes charge of managing the end-to-end workflow, and where people are assigned to tasks not by transaction volumes, but by exception – because most, if not all, the heavy lifting is done in a touchless manner.
Now that we understand what touchless planning is, how do we deploy these capabilities across an extended enterprise?
What’s needed is a target operating model that can take advantage of the organization’s worldwide resources and capabilities, connecting them to achieve a truly frictionless process. It’s a model that has three building blocks.
A frictionless approach to supply chain planning can make a competitive difference to major businesses – a difference that isn’t just real and immediate, but one that will also scale and flex to meet new challenges, including those we can’t yet even imagine. After all, this is the way it’s always been in the supply chain.
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