Digital Supply Chain – automation for agility

Welcome Pat. Could you start by talking about yourself and experience at Capgemini?

Dharmendra (Pat) Patwardhan: Yes, thank you. I head the Digital Supply Chain Practice at Capgemini’s Business Services. Prior to starting this very exciting role, I headed several of Capgemini’s largest client engagements, for a period spanning five years.

Could you talk about the different elements that Capgemini’s Digital Supply Chain Practice comprises?

As I’m sure you’re aware, supply chain encompasses a very large area. There are currently five elements we focus on, bearing in mind what’s most relevant to our clients and the dynamics in the global supply chain space.

In no particular order, these are Demand Planning and Supply Planning; integrated Master Data Management; Order Fulfillment and Management; the emerging area of Logistics Control Tower; and Procurement Operations. We view Master Data Management from a horizontal perspective across all these areas, as master data supports all of the underlying processes.

Supply chain processes are very industry specific – as are the solutions we need to provide to our clients. The intersection between our capabilities and demand in the marketplace means that we primarily focus on the industry sectors of Consumer Packaged Goods (CPG), Retail and Manufacturing, and their subsets such as Chemicals, Pharmaceuticals, and consumer devices.

What would you say is unique about Capgemini’s Digital Supply Chain offer?

If I had to highlight one aspect that could be considered a differentiator, it would be that our Digital Supply Chain offer is focused on delivering enhanced business outcomes to our clients rather than solely focusing on efficiency and costs.

In Demand Planning and Master Data Management, in particular, the reason clients come to us is not because we deliver services at a reduced cost. In fact, although in some cases this can result in incremental cost for our clients, they are willing to incur it as we deliver real and tangible business outcomes.

Let me illustrate this with a couple of examples. We provide solutions to our clients on reducing their inventory levels while not losing sight of the need to sustain service levels. Similarly, in Master Data Management, we provide solutions that reduce the overall turnaround time for our clients’ supply chains. It is our ability to deliver these kinds of enhanced business outcomes that make our Digital Supply Chain offer unique in the market.

How does this compare to Capgemini’s competition in the digital supply chain space?

We are in active discussions with many of our clients to take on their complete planning functions and then commit to outcomes that synchronize with their business needs.

As an example, the supply chain organization of one of our global manufacturing clients has committed to their business that they will deliver on certain inventory and service levels. Capgemini is committing to deliver these same service levels and outcomes, which represents an industry-first.

In a nutshell, we are offering something that is completely ahead of the game – not just with respect to our competitors, but also with our clients.

Could you talk more about the benefits and business outcomes of  implementing Capgemini’s Digital Supply Chain solution?

All supply chains essentially have three metrics on which a supply chain organization is measured across industry sectors, these being cash, cost, and service.

What I mean by “cash” is the amount of inventory an organization holds, which represents the actual money that is, in effect, stuck for the business. The “cost” is the actual cost of executing the entire supply chain. “Service” is the service levels to which the supply chain organization is committing to the business. In simple terms, this means the ability to fulfill customer demand on time and in its entirety, as well as the ability to do it with the least possible inventory.

These are the three business outcomes we commit to as part of our supply chain offer across the focus areas I mentioned previously.

What is the future of supply chain – both at Capgemini and within the wider industry?

Businesses continue to be disrupted by volatility in the market and the speed of change. This is a common theme for organizations across different industries around the globe. Supply chain is not immune to these challenges.

Traditionally, supply chains were geared towards long production lines and massive investment in distribution channels. This is all being disrupted. For example, e-commerce is having a huge impact on distribution – the ability to deliver products in smaller sizes at increased speed in response to customer demand is becoming absolutely paramount. The era of long production lines that churn out a huge amount of goods at a single location at lower cost, but also reduced flexibility, is coming to an end, again due to increasingly volatile customer demand.

However, we must remember that the supply chain is a service provider to the core business that makes and sells products to end customers in order to fulfill demand. What this means for the supply chain organization is the need to be more agile and cost effective – and this is exactly what Capgemini is enabling our clients’ supply chain organizations to become.

Within the Demand Planning and Supply Planning space, there are two themes that are becoming increasingly important. The first is “continuous” – the ability to react to changing environments as they happen, rather than within the traditional periodic cycle, and the second is “touchless” – which means that human intervention is limited to exception management, with much of the work being done by intelligent automation and machine learning algorithms.

The supply chain industry is being driven by the advent of automation that is enabling organizations to become more agile and responsive. At Capgemini, this is exactly what we’re doing – combining the best-of-breed technologies with our own proven architectures and methodologies to transform our clients’ supply chain functions.

Dharmendra Patwardhan is responsible for developing offers and capabilities for transforming supply chain operations that drive tangible business outcomes for Capgemini’s clients.