Operations leaders’ agenda
In times of global business disruption, operations leaders should seize the opportunity to build enterprise resilience, drive transformation and reframe the future of their organizations.
Five actions supply chain and operations management can take today
An increasing number of disruptions are stressing supply chains and impacting business performance. External pressures from stakeholders are also driving operations management and strategy leaders to seek supply chain solutions to help them become more resilient, sustainable, secure and transparent. Here are five actions to make the digital and autonomous supply chain a reality:
Traditional supply chain structures are not equipped to cope with massive and ongoing disruptions. Moving from “just in time” to “just in case” requires companies to improve their supply chain resiliency. Supply chain solutions include embedding end-to-end visibility, simulation and risk monitoring into the supply chain; securing alternative sources of supply; developing a resilient operating model and workforce; and improving cybersecurity. Enterprises can also improve supply chain logistics agility by fulfilling customer orders from the most optimal node in a cost-effective way.
Consumers across the globe are demanding more sustainable products, and companies must respond by embedding end-to-end sustainability into their supply chain processes. Building circularity into supply chain processes means not only trying to reduce a negative footprint but also creating a positive one. This can be accomplished by using renewable energy in manufacturing and delivery and aiming for zero waste along the value chain. Enterprises are also looking for ways to reduce carbon emissions in the supply chain, and this means they must reconsider the materials used in manufacturing and packaging, the markets they compete in and optimizing supply chain logistics.
Companies further along their transformation journeys can respond quicker to changing customer demands and disruptive forces. With only 25% of companies digitally networked and even fewer autonomous, enterprises must move from linear to connected ecosystems of partners, suppliers and alliances, and then toward fully autonomous supply chains that are resilient and sustainable. Integrated business planning, transport and warehouse logistics, product innovation and customer collaboration must be part of the mix for improved supply chain operations management.
Procurement is no longer simply about cost savings: it is a strategic endeavor that includes collaboration and finding new ways to add value. Organizations should consider an analytics-driven sourcing strategy to optimize supplier portfolios; adopt new technologies, such as AI for contract management and cloud-based supplier collaboration tools; and improve working capital through supply chain finance and supply chain optimization.
Operations management and strategy for Industry 4.0 is about improving productivity and decreasing waste and cost. One powerful way to transform the manufacturing function is through the adoption of the smart factory — where cyber-physical systems monitor factory processes, provide analysis, and automate or support decision-making and controls. With digital manufacturing, enterprises can gain on-demand visibility into performance across the production chain, lower costs and improve collaboration with suppliers and customers.
Welcome to the future of supply chain
Learn about the impact of digitalization, the need for supply chain reinvention to meet the demands of today's digital world and what the future of supply chain looks like.
EY Supply Chain Intelligence Platform
The EY Supply Chain Intelligence Platform brings the visibility needed to enable a networked and resilient supply chain for today and for the future. Now you can analyze the entire breadth of your supply chain to better align with your business priorities.