The autonomous supply chain – the road ahead
Blog: Capgemini CTO Blog
In this short series of articles, we’ve been looking at the supply chain challenges organizations typically face, and the extent to which they have been complicated by current pressures. We’ve also outlined the characteristics and benefits of the autonomous supply chain.
In this, the third and final article, we’re going to assess the current climate for the adoption of this approach, at critical success factors, and at the support an external services provider can give.
Key focus areas
In previous articles in this series, we’ve already seen indications of a business appetite for the end-to-end visibility that the autonomous supply chain can provide. Indeed, in a recent report conducted for Capgemini by NelsonHall, we learn that roughly a third of enterprises (34%) plan to undertake significant autonomous supply chain initiatives over the next two years. These initiatives can be broadly grouped into three areas: planning and forecasting, supply chain optimization, and supply chain execution.
Within these three areas, the functions on which survey respondents were most focused included:
- Supply forecasting (40% of respondents) – obtaining more data from key suppliers to enable longer range planning
- Demand forecasting (32%) – using wider sources of information such as social media, and increasing campaign integration with major retailers
- Warehouse optimization (22%) – fully automating orders, right through to depot picking and dispatching. Also, moving raw inventory on plant pull signals with no manual interventions
- Consignment tracking (52%) – implementing real-time tracking on more raw inventory for greater overall improvement of the supply chain. Also, simultaneously improving customer satisfaction and reducing inbound service inquiries, by using machine learning techniques to track data supporting logistics movements, and then proactively providing that information to customers.
The supply chains of major enterprises are so large and complex, and their role is so crucial, that it’s no surprise to find that, according to the survey in the NelsonHall report, 84% of organizations will involve vendors when implementing autonomous supply chain initiatives. So – what should you look for in their potential partners?
Perhaps, needless to say, it’s important to work with service providers with both the consulting and operational supply chain expertise to reimagine and deliver supply chain transformation projects – and who are also able to address your organization’s own global scale of operations.
Less obvious, maybe, is that this process knowledge needs to be matched with substantial experience of automation and analytics. For example, machine learning and deep learning technologies are rapidly becoming essential in the supply chain’s ability to become touchless and autonomous. To demonstrate relevant experience in these areas, potential partners should be able to show they have developed best-in-class solutions based on integrated combinations of process models, industry platforms, and automation technologies.
Critical success factors
There have always been significant and complex demands made of enterprise-level supply chains, and the COVID-19 pandemic has increased the pressure for them to deliver – both figuratively and literally.
There are several key elements for success:
- A staged approach – it’s a good idea for the overall strategy to involve a series of linked short-term projects, each delivering demonstrable returns on investment (ROI) in the near term
- A pilot program – each of these stages should be piloted, so as to provide a working prototype that addresses all the issues that have arisen along the way
- Leadership buy-in – continuing to demonstrate ROI will maintain senior support for the transformation, and this, in turn, will help to keep things moving through to completion
- External buy-in – trading partners need to be on board, too
- A good team – the people implementing the program are likely to be a mix of internal personnel and those from vendors and service providers. They need to have relevant complementary skills and experience, and they also need to work together well, and towards shared goals
- Good data – legacy systems and manual processes present problems. The prospect of tackling them is daunting, but the main lifting and shifting will with luck be a one-time fix, and the results will be worth it
- Continuous improvement – addressing the major legacy and manual issues may largely be a one-off, but transformation as a whole certainly isn’t. An autonomous supply chain, and the Frictionless Enterprise of which it is part, have versatility and flexibility in their DNA.
Experienced service providers will of course be part of the good team on this list, and they will be able to help ensure you address all these factors efficiently and effectively.
To learn more about the autonomous supply chain and its role within the Frictionless Enterprise, read NelsonHall’s full report “Moving to an Autonomous Supply Chain: An Essential Guide for Manufacturing & CPG Firms.”
Read the “Fast Forward: Rethinking supply chain resilience for a post-COVID-19 world” report by the Capgemini Research Institute (CRI) to understand how you can future-proof your supply chain for a post-COVID world.
Read other blogs in this series:
- The autonomous supply chain – long-term challenges and current pressures
- The autonomous supply chain – characteristics and benefits
Dharmendra Patwardhan is responsible for developing offers and capabilities for transforming supply chain operations that drive tangible business outcomes for Capgemini’s clients.