Build Smarter Supply Chain of the Future with TAFF

Some business leaders assume that creating a digital supply chain means automating a single task, such as forecasting demand or optimizing the production schedule. At TAFF, we know that supply chain digitization requires a holistic transformation mindset.

According to a McKinsey research report, the average supply chain has a digitization range of 43% which is still lower than the other 5 main business areas that were studied. Another study by McKinsey reports that companies that focus on digitizing supply chain management are likely to grow their annual EBITA by 3.2 percent. It is also estimated that companies can expect an extra annual growth of 2.3% CAGR by switching to smarter supply chain solutions.

The Growing Shift To Smarter Supply Chains

The Covid-19 pandemic and the global lockdown wreaked havoc across the local and international supply chains. Global product shortages, facility closures, factories being shut down, etc, were some of the undesired outcomes of Covid-19, yet the shipping industry survived and still persists to offer a smart supply chain. The companies that survived the 2021 scare are now facing a totally different set of new challenges in 2022. Let us look at the challenges below.

Cost Containment

According to the quarterly report by the US Federal Reserve, the country is facing its highest inflation in history. Due to the rising cost of the supply chain, most of the consumer-facing industries are facing heavy pressure in profit margins as the cost keeps on increasing. Some of the key factors that led to this cost increase are

1. Global Brent Crude pricing is trading above 86$ which is at 4 year high. This has led to increased cost of transportation via road, air and sea.

2. Due to increasing demand and challenges in the supply chain, the cost of raw materials has increased a lot, be it steel, chemicals, lithium, aluminium, etc.

3. Labour costs have increased significantly throughout the globe.

4. The international cost of shipping and storage skyrocketing is another main challenge

Increasing Customer Demands

The start-up ecosystem has thrived both in Silicon Valley and in other countries like India even during the pandemic period. Today customers have multiple choices to choose from and they are looking for only products and services of the highest quality. Not only quality, but the speed of delivery is another important thing that determines the buyer’s decision. Price is no longer the deciding factor for consumers as new requirements have popped up recently like 

1. Consumers prefer only those companies that can deliver goods and services immediately. 

2. Products should beat the quality requirements put forth by the customers.

3. Raw materials and working conditions of the employees should fulfill the regulatory compliance set by the regulators.

4. Consumers are more ethically aware now and giving priority to businesses that source raw materials from environmentally friendly suppliers.

Globalization

Today customers prefer to order products from other countries online sitting in the comfort of their homes. Many e-commerce and logistics startups have started offering international products available to global consumers which have created a new marketplace. 

Supply Chain Visibility

Consumers prefer to stay ahead of the curve and would like to get real-time updates about their orders. They prefer to track their product location live using technology. Globally successful e-commerce players like Amazon enables the customer to see where their products are at any given point.

Risk management

Supply chain management is always prone to both regulatory and legal risks. The constantly changing environmental factors or volatile economic activities can lead to unprecedented delays in the supply chain. International trade disputes is another area of concern that the supply chain has to deal with. 

 

The Road to Smarter Supply Chain with TAFF

As mentioned earlier, the global supply chain industry is moving in a different direction and it is imperative only those businesses that embrace a smarter approach to the supply chain will thrive and succeed. We at TAFF believe that a smart supply chain system can be made possible with 3 core characteristics or 3i s as we call it. 

Instrumented: Digital transformation is key to achieving a smart supply chain and we can instrument it through all stages of your SCM. Example – Information that was previously created by people will gradually be machine-generated—streaming from sensors, RFID tags, meters, actuators, GPS and more. Inventory will operate and calculate itself. Containers will recognize their contents and Pallets will review and report if they end up in the wrong place.

Interconnected: Our entire supply chain will be interconnected – Not just suppliers, customers, IT systems and also connecting products, parts, smart objects to the supply chain. The broad connectivity will help the worldwide networks of supply chains to plan and take the right decisions together. 

Intelligent: Our advanced analytics and modelling will help executives in evaluating the trade-offs and suggest the alternative solution incase of any complex and dynamic risks and constraints. Smarter systems will make some decisions automatically – increasing responsiveness and limiting the need for human intervention. 

We know that digital transformation in supply chain management performs best and it will unlock great value when they’re integrated across the entire enterprise, when they involve both processes and people. Adapting  a smarter supply chain not only helps in just positioning companies to be more agile, reliable, and efficient; it also delivers higher margins and lower costs.

The Smarter Supply Chain of the Future

The modern supply chain must grow to meet new customer demands and supply chain challenges, and supply chain managers need to plan ahead to keep all the processes running smoothly. They have to align their supply chain strategies with rapidly changing business strategies. Then, to implement those strategies, they’ll need to innovate and make the supply chain more sustainable, flexible and responsive through increased instrumentation, interconnection and intelligence. 

 

The adaptation to the Smarter Supply Chain should be seamless, without any operational interruptions or performance slips.

Smarter Cost Containment

Our digital solution will track multiple verticals of cost globally, help predict cost volatility upfront and enable the businesses to hedge for them accordingly. Such a level of flexibility will help companies to counteract unknown cost volatility. To power up the resources optimally, the supply chain management utilizes intelligent modeling capabilities.

• IOT based / Beacon based solution to increase visibility and reduce cost.
• Transportation, distribution and assets monitored with smart devices for efficiency and utilization.
• To control energy usage and waste – Production and distribution process detectors are integrated to monitor.
• Integrated demand and supply management includes advanced decision support
• Scenario-based operational analysis to help decision makers to take the right approach. 

And the simulations permit the supply chain officers to view the cost, service level, time and quality impacts of the alternatives being considered. 

Smarter Visibility

Once your traditional supply chain system is fully converted into a digital medium, all the stakeholders will have real-time access to information that enables them to make smarter decisions. 

• Smart monitoring devices and sensors (RFID) to capture real time visibility: forecasts/orders, schedules/commitments, pipeline inventory, shipment lifecycle status.
• Multipartner collaborative platform for suppliers, customers and service providers, with data synthesis and decision support.
• Service-level analysis with inventory optimization.
• Optimized buy recommendations
• Advanced decision-support analytics and optimization to automate and self-actuate supply chain transactions.
•  Predictive analysis of buy-sell decisions to understand the customer behaviour and demands.

Smarter Risk Management 

As mentioned above, SCM globally faces many risks that can totally shock the industry and could lead to unforeseen problems. We build a smart risk management system that constantly tracks multiple parameters to determine risks much before they actually trigger whether it is a regulatory risk or trade dispute. 

The smarter supply chain recognizes risk systematically. Its risk reduction strategies take advantage of millions of smart sensors and objects that can report threats like temperature fluctuations, theft or tampering. It also collaborates with supply chain partners on joint mitigation plans and approaches. And if (or when) problems do occur, it takes advantage of real time connectivity across the extended supply chain to respond in a rapid, coordinated fashion.

• Weather intelligence and sensors for predictive analysis for supply planning, routing orders and allocations.
• Integration of financial and operational analysis.
• Compliance plans and policies with suppliers, service providers, vendors, manufacturers.
• Risk-adjusted inventory optimization and Risk-based financial impact analysis to understand and manage risk. 
• Sensor solutions to keep track of product condition through the supply chain to help ensure product quality.

Smart Maintenance

Our smart maintenance solutions come with built-in maintenance modules that pair with wireless IIoT devices and sensors that use machine learning and  artificial intelligence that help businesses to  remotely monitor, analyse, and assess the complete supply chain equipment performance.

Smart maintenance allows for better control over maintenance management, which, in turn, enhances equipment productivity and performance.

It can optimize any maintenance strategy from time-based preventative maintenance to run-to-failure, where equipment is deliberately operated until breakdown before maintenance takes place. With this level of visibility and deep insight into equipment performance, supply chain maintenance managers are able to predict asset failure better and identify next steps to prevent unplanned downtime.

Smarter Customer Interaction

Knowing the customer and meeting their needs and expectations is very important. Smarter supply chains collaborate with customers all over the product lifecycle—from research and development, to everyday product usage, to product end-of-life. 

• Pervasive instrumentation permits smarter supply chains to intercept demand signals at their source—items lifted from shelves, products leaving stores or critical parts showing signs of wear. 
• Automated IoT-based / sensor-based checkout for better customer experience.
• Based on customer behaviour – inventory pipeline is planned, executed and optimized. Simulation models of customer buying patterns and their  market penetration applied to planning and operations volumes

Every interaction from the customer end becomes an opportunity for effortless customer collaboration. Smarter supply chains also use their intelligence to look beyond the masses. Through advanced predictive and behavioural analytics, they can identify ever-finer customer segments and customize their offerings accordingly. A smarter SCM enables customers to be a part of the solution in all stages of SCM.

Smarter Global Integration

A smarter global integration helps businesses to interact and track global developments immediately. Smarter supply chains have the analytic capability to evaluate myriad alternatives in terms of supply, manufacturing and distribution—and the flexibility to reconfigure as conditions change. 

Realtime combined with sensors to detect product and shipment locations worldwide. Sensor solutions binding the expanding global trading partner infrastructure for increased supply chain visibility.

This will allow executives to plan for emergencies and execute amid economic and political volatility without reverting to protectionism or reverse globalization. 

Ready To Work Smarter ?

The success of every business, whether it is a manufacturing industry or retail industry or an e-commerce entity, depends on how efficiently and smoothly they are managing their entire operational management, especially the deals related to the supply and delivery of their products.

This is the best time for companies to build a smart SCM that will help them overcome challenges and drive growth. TAFF has built sophisticated smart supply chain solutions and we will be glad to partner with you to convert your traditional supply chain into a smarter one that will both drive revenue and bottom-line.

With a 360-degree view of the entire manufacturing operation and value chain, supply chain decision makers can constantly adjust to changing conditions and develop sustainable models. To start your digital transformation, contact our team today.

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