10 minute read

What makes operating today’s supply chains simultaneously the greatest opportunity and the biggest headache?

How do we create a digital-first supply chain that is resilient, secure, and sustainable?

How do supply chain leaders start their journey toward a digitally-enabled supply chain that fosters reliable, long-term business growth?

At Nulogy xChange 2021, keynote speaker Dr. Elouise Epstein addressed these issues and more through her trademark presentation style and leveraging her decades of industry experience. Dr. Epstein is a partner at Kearney, a global management consulting firm, and a prolific author on digital supply chain and procurement. As a digital futurist, she focuses on how to apply digital solutions to solve real-world business problems.

Dr. Epstein spoke about how enterprises can reimagine and optimize their supply chains to better prepare for disruptions, with her presentation following three chapters of a story:

  • The problem with today’s supply chain
  • Reinventing the supply chain solution ecosystem
  • Fostering A Digital-First Approach for Tomorrow’s Supply Chain

The Problem with Today’s Supply Chain

Supply chains today are inadequate in their inability to predict and manage disruptions such as COVID-19 and cyber-attacks. Dr. Epstein explained the ease of which today’s supply chain can be hacked, citing the SolarWinds supply chain breach as an example of how hackers targeted the weakest link in the supply chain, taking advantage of the trust that organizations placed in their third-party, downstream vendors.

"We have designed and optimized the supply chain for cost and profit maximization, but that doesn’t work in the era of disruptions we’re currently living in." Elouise Epstein

The COVID-19 pandemic also uncovered major flaws in the supply chain, including: a lack of risk management strategies, a lack of traceability, inadequate analog data methods, and the need for new infrastructure.

Reinventing the supply chain solution ecosystem

Dr. Epstein identified five elements that leading supply chain organizations will need for future security and resilience in 2025:

  • Supplier innovation and organizational “glue” to drive new business models
  • Cost and resiliency competitiveness
  • Platform for environmental, social and corporate citizenship
  • Adopting the digital and agile approach
  • Hyper efficiency: driving today’s value with 30% of the resources

For fast-moving consumer goods (FMCG) brands to plan product cycles, source materials, manufacture new products and deliver them to store shelves, they require multiple transactional systems such as ERP, MES, MRP, and TMS solutions. The downside of these myriad supply chain solutions is their inability to interoperate and communicate with one another to provide the brand organization with a centralized, unified view of their supply chain.

These heterogeneous systems fail to provide the comprehensive, real-time network view that leaves organizations blind to disruptions such as shortages in materials or supplier capacity.

By contrast, Dr. Epstein posited her view of the supply chain ecosystem of the future, which offers a live view of the end-to-end process, from demand planning, inventory optimization, production planning and live scheduling to fulfillment, transportation, and supply chain analytics.

Dr. Epstein identified six digital guiding principles that are needed in every organization’s supply chain toolset:

  • Top User Experience
  • High Quality Data
  • Ubiquitous Analytics
  • Full Automation
  • Plug-and-play Integration
  • Enabler to create value with a focus on growth enablement

A Digital-First Approach for Tomorrow’s Supply Chain

Following these digital guiding principles will lead to a new operational model for supply chain management. In Dr. Epstein’s words, supply chain management will shift toward “a digital-first approach that shapes the full function of supply management.” It is a new model that focuses on how a digital supply chain can inform its organization’s business strategy, its approach to the people, capabilities, and culture within, its processes and governance, and its ability to be agile and responsive no matter what lies ahead in the future.

"We need a cultural change and reimagined skillset to protect and secure the supply chain and optimize it for the future. And we need it now." Elouise Epstein

Final Takeaways

Supply chains can’t be managed with paper.

Supply chains can’t be managed without extensive cybersecurity awareness.

Dr. Epstein explained that as our personal lives become increasingly digital, supply chains need to follow suit. Supply chains of the future have to be rethought as primarily digital, instead of shifting from analog to digital. In turn, the skills and talent that will be managing tomorrow’s supply chain will also be hyper-connected. And it is time that supply chains wake up to the reality and opportunities that the future has in store for them.

"Digital is not something you learn. It’s something you live." Elouise Epstein

You can read more from Dr. Epstein in her latest book, Trade Wars, Pandemics, and Chaos: How Digital Procurement Enables Business Success in a Disordered World. She is also a co-author of Disruptive Procurement: Winning in a Digital World.

Download our Nulogy white paper to learn more about future-proofing your external supply chain.

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Written By
jason-tham
PUBLISHED
Nov 18, 2021

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