Current challenges in supply chain planning
The annual Gartner Supply Chain Symposium XPO will take place this year from June 10 to 12 in Barcelona. Kearney is represented with a stand for the first time this year and OPTANO is part of the story. In an interview with Kearney partner and supply chain expert Ingo Schröter, we would like to talk about what is currently on the agenda for companies.
Supply chain managers have had a wild time: coronavirus, natural disasters, geopolitical conflicts and terrorism are just a few examples of the major events of the last four years. In your experience, what issues will be of most concern to the industry in 2024 and beyond?
In my opinion, the topics are somewhat dependent on the maturity level of the respective companies, but we will certainly be talking about analytics and AI in particular, in addition to the evergreen topics of planning transformation and network optimization. Both areas are increasingly finding their way into modern supply chains and are therefore of great interest.
Sustainability will also play an important role, even though many companies are currently more concerned with the classic challenges of the supply chain, namely the efficient management of costs and inventories.
There is also the issue of resilience. Although this has taken a back seat overall due to adjustments made in recent years, it remains a constant challenge for supply chain managers.
Let’s take a look at these examples: What measures can companies take to secure their supply chains in the long term and what conflicting goals need to be resolved along the way?
The first step for any company thinking about a future-proof supply chain should be to think in terms of its customers and markets and derive the SC strategy from the corporate strategy. A comparison with the current capabilities then reveals weaknesses on the one hand, but also opportunities to use SC as a competitive factor on the other.
The future belongs to companies that use decision support systems
What contribution can technology make to secure supply chains and resolve conflicting objectives?
Technological support has become indispensable in today’s supply chains. No company works without ERP anymore and almost all of them are in the process of renewing or improving their planning systems. However, the future belongs to those who further augment their capabilities by using decision support systems. These enable faster analyses of larger volumes of data to recommend immediate actions.
In the future, we will probably even go one step further and move from “recommended action” to “automatic control” – at least within parts of the supply chain.
One prejudice we often hear is that only large companies and corporations can afford sophisticated supply chain solutions. Is there any truth to this, or to put it another way: what types of companies can benefit from such a solution?
I would say it depends on the solution and, above all, on evaluating where capabilities are lacking in the supply chain. Examples of this would be cost and inventory reduction issues, or those relating to additional sales or margin potential. If the opportunity is large enough and cannot be realized without an IT solution, you must of course always weigh up whether an investment is worthwhile.
If you look beyond the operational side of things, many of today’s well-known companies have grown up thanks to their IT. That’s why I firmly believe in “supercharging” through digital processes and sophisticated analytics. That’s why we at Kearney are making targeted investments in this area – for example by acquiring OPTANO in the fall of 2022.
Companies should make the right focused investments
As with many major changes, there are always early adopters and latecomers. Would you advise companies to tackle the transformation as soon as possible, or is the time factor rather uncritical in your view?
Both can be an advantage and a disadvantage. On the one hand, let’s take the much-cited example of Amazon: The company has created a massive competitive advantage through its IT in the supply chain – think in particular of “demand sensing & shaping” – which many companies are still chasing today.
On the other hand, there are also some of my customers who have invested a lot of money in so-called “digital use cases and MVPs” and are still not really seeing the hoped-for impact. In this respect, you should consider where a benefit can really arise and then make the right focused investments while at the same time staying on the ball through a high level of interaction with the solution provider market and the cross-company network.
Of course, we at Kearney are happy to help with this.
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From June 10 – 12, we will be exhibiting with you at the Gartner Supply Chain Symposium XPO in Barcelona. What topics and events can visitors to the Kearney stand look forward to?
XPO is the most comprehensive event in Europe for a wide range of industries, which is why we will be there again – this year even with our own stand. Our theme is “Regenerate – Strong Supply Chains”, under which we summarize the core topics that companies are dealing with in order to align their supply chain for the future. This always means looking at how the supply chain can help to make the company as a whole more successful.
What are you personally looking forward to most at the event?
A conference thrives on the interaction between participants. I am looking forward to many stimulating discussions with our customers and other interested companies, but also with the solution providers on site. And, of course, to an exciting and intensive week with our great organization team – Barcelona we are coming!
Thank you very much, Ingo, for taking the time for us.
Do you already know our factsheet on the topic?
In our factsheet “Why choose supply chain analytics?” we describe the different types of supply chain analytics. You will discover how supply chain analytics works and how it can help to optimize your company’s supply chain.
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