- According to institution of civil engineers, Collaborative working is a solution to making the necessary productivity improvements, one of the biggest findings of the survey relates to generating that sense of commitment from everyone involved. While ensuring genuine buy-in from the client can be a challenge, persuading the supply chain of the benefits can be equally as daunting.
(Image source: www.ice.org.uk)
Inhibitions to collaborate
- A collaborative environment/platform is always necessary to break the inhibitions and start collaborating with others.
- This collaboration results in better trust, simplifies communication barriers, resolve conflicts mutually and results in a positive work environment
- Supply chain visibility (SCV) is knowing where inventory is at any given time, and how well parts, components or products in transit can be tracked as they move from the manufacturer to their destination
70% of the companies feel that end-to-end visibility is impacting their supply chain to large extent [Ref]
- Visibility is the key in making sure everyone has the right information at the right time to take accurate and faster decisions
- Internal as well as external parties need visibility to collaborate with much lesser communication as the situation is made aware to the right people real-time
- Visibility of the status at each stage of the order including the delays, issues, accountable personnel, defects, quality, etc., which are key to prevent risks and increase efficiency
- When a firm (say, a supplier) is provided with the right visibility, they can be better prepared for the situation, respond much faster with right tools and inventory that is required to meet the situation even before the other firm (the buyer) communicates explicitly about the requirements to be met
- Similarly, procurement, operations, logistics and all parties involved in the supply chain must have a clear real-time view of “what is happening out there” to give their best to deliver products to the consumers at the right time with lower cost
- In manufacturing, if the planning department has visibility into the machine maintenance details that are scheduled by the maintenance department, necessary adjustments will be made accordingly to meet the demands. In the vice-versa situation, when maintenance department clearly views the required machines to be up and running to meet the production demands, they can plan and optimize the schedules.
Information availability and sharing
- This is tightly linked with supply chain visibility and the focus is on making the right amount of information available to the right personnel for enabling him/her to take quick and accurate decision
- Collaborative Planning, Forecasting and Replenishment workflows and solutions exist in the supply chain process to enhance supply chain integration and data sharing across enterprises but very few companies effectively use it to their competitive advantage.
- Types of information:
- There are many different types of information that can be shared within a supply chain, including logistics, business, strategic, tactical and so on.
- Some familiar types of Information may be categorized as:
- 1) Inventory Information;
- 2) Sales Data;
- 3) Sales Forecasting;
- 4) Order Information;
- 5) Product Ability Information;
- 6) Exploitation Information of New Products; and
- 7) Other Information. Partners like to share Inventory Information the most.
- When multiple parties inside and / or outside the organization needs to access to the required information and data, many of them face challenges such as knowing the source of the data, authenticity, the current/latest changes, location of the information, etc.
- If the organization structures the information and data that is easy for collaboration, then the information is shared across multiple parties with right permissions, allow data changes real-time and reflect them immediately to all other interested parties, made sure data is up-to-date.
- A lot of time and effort could be saved if the information is made available through a streamlined channel that is up-to-date and can be trusted. Without this, people look for information that are scattered around multiple channels (Emails, Papers, websites, contract, videos, etc) which might not be accurate and latest. This might result in making decisions with limited set/outdated data.
- For example: when a buyer makes all the latest information about the goods supplied, quality status, rejections, demand, history of supplies, etc available to the supplier, the supplier is empowered with rich data set to further improve the quality, figure out plans to reduce cost, improve delivery speed, keep up the commitments, plan for optimal future deliveries , etc with ease. Imagine the pain of the supplier to carry out the above said measures if the required data points are scattered, partially available or available but not discovered.
- Efficient inventory management
- Cost reduction
- Increasing visibility
- Improved resource utilization
- Increased productivity
- Early problem detection
- Quick response
- Better tracking and tracing
- Optimized capacity utilization
- A real-time communication mechanism could save lot of delays in passing on the message with the same intention and tone to the recipient(s).
- Nowadays, there are lot of communication mediums used for various purposes.
- Adopting out a stable, simple and real-time communication platform is key in improving the reaction time among the stakeholders (internal and external parties)
- This is a result of miscommunication, lack of data availability on time, complex workflows, etc.
- When the levels of collaboration increase, even a complex workflows and processes can work seamlessly
Preparedness for uncertain situation
- Whatever business you are in, it is mandatory to constantly monitor the suppliers who supply critical components for your products or critical players in delivering the products, to be well prepared for any uncertain situations
- This is possible when all the stakeholders are well connected and communication flows seamlessly to the right decision makers at the right time to forecast a situation and respond with appropriate plans/actions to avoid any disruptions in the supply chain
- For example: In 2017, it was reported that iPhone 8 launch was delayed 3-4 weeks due to problems in upstream supply chain (to which resulted in analysts to cut the company’s profit expectations (Source)
Lack of insights
- Data inconsistency is always an issue with any organization and processes.
- Data is created everywhere at every level of operation by everyone involved in supply chain
- Huge volume of data is generated but not productively utilized for business decisions
- Gartner defines dark data as “the information assets organizations collect, process and store during regular business activities, but generally fail to use for other purposes.” It includes all data objects and types that have yet to be analyzed for any business or competitive intelligence or aid in business decision making.
- To depend on the available data for decision making, the data must be always consistent.
- In a collaborative or connected organization, when data across different business areas are integrated, analyzed with right tools to ensure complete visibility, then the decision-making process can depend on the insights derived from the data that enables quick and better decisions across supply chain
Blogs in this series: