Supply Chain Opportunities
BSBA OM I403
Opportunity Description
Conquering Supply Chain The complexity of every system refers to the
number and variety of elements it contains, as
Complexity
well as the connections and interactions
between them. Products/services,suppliers,
customers, and the company's own system of
operational vertices are all components of a
company's supply chain.
Improving Supply Chain One of the most common challenges that
Measurements supply chain specialists currently face is
determining the appropriate Key Performance
Indicators (KPIs) and, more importantly, Key
Performance Predictors (KPPs) to observe the
efficiency of the supply chain, identify risk, and
minimize costs.
Take Advantage of The world is currently facing its fourth industrial
revolution, "Supply Chain 4.0," which is a critical
Emerging Technologies component of "Industry 4.0." In the new reality, supply
chains will add value to the company not only through
improved performance but also through business
strategy distinctiveness.
Prioritize Supply Chain
Efficacy over Supply Chain
Efficiency
Human interaction and innovation in meeting
challenges and leveraging opportunities are
prioritized in supply chain effectiveness. It
utilizes a long-term view, creating value through
improved performance, reduced risk, increased
resilience, and strategic administration of
working capital.
Pursue Supply Chain
Resilience Incorporating resilience into your supply chain,
like agility, is an ideological as well as a
procedural shift. It frequently necessitates both
cultural and process changes. It necessitates a
willingness to overcome complex problems with
data management solutions.
ABDAO, Rianna Cecilia S.
Recommendation
Businesses should employ the Long tail analysis of market segments  It aids
in the identification of numerous low-volume, high-variability, low-margin
products, as well as successive pricing changes and trimming of cost-
absorbing supply chain products. Another approach that businesses should
do is network optimization, which entails simulating the entire supply chain
to assess the network and total costs. Total landed costs measurement and
the ability to optimize inventory throughout the entire supply chain can
bring about substantial efficiencies and better service for customers.
Firms should identify the appropriate set of KPIs and KPPs that have an
impact on their business. They should be capable of developing a model
that emulates the client's supply chain features using advanced
mathematical programming and identify which KPIs have the maximum
impact on their business sales and profits using sensitivity analysis. Firms
that can identify the appropriate KPIs and KPPs benefit from high visibility
into the supply chain, the ability to prevent supply chain failures, and
reduce landed costs.
Companies should integrate digitalization tools like automation, artificial
intelligence (including machine learning), and advanced analytics into
their procurement systems and supply chains to draw a distinction
from—and possibly even ahead of—the competition. IKEA uses
automatic storage and retrieval systems in its high-flow warehouses to
reduce costs per touch.
Companies must increase supply chain visibility by implementing
inventory management strategies that allow them to track levels of
inventory as they move through different phases such as receiving,
warehousing, packing, picking, and shipping to clients. Modern inventory
management software (IMS) can provide greater visibility as well as access
to real-time inventory tracking, allowing a business to prevent overstock,
delivery delays, and spending too much money on overhead expenses.
Firms should also use warehouse automation to cut down on the time,
effort, and errors that are prevalent in logistics. GreyOrange,
headquartered in India and founded in 2011, is a leading provider of
warehouse automation solutions. Robotic picking and packing solutions,
warehouse management systems, and fulfillment center management
software are among the products and services provided by the company.
Businesses that want to compete in the new normal should focus on supply
chain resilience because adaptability and the ability to respond are two of the
best defense mechanisms against the disruptors that threaten long-term
sustainability in the modern global economy. Following the 2011 earthquake
and tsunami, one of the most well-known supply chain resilience examples
occurred in Japan. Following these twin disasters, it became clear that Nissan
and Toyota suppliers were struggling to cope with the shock. Nissan was able
to resume operations and regain lost market share much faster than Toyota
because it quickly built an alternative supplier network. Toyota, for one, learned
the value of resilience and was able to recover much more effectively when
disaster struck again in 2016.
Supply Chain Challenges
Challenge Description
Digital Transformation
Digital transformation and IoT can have both
positive and negative effects on supply chain
operations. Therefore, several technological
advancements, such as artificial intelligence,
robots and drones, electric vehicles, and on-
demand delivery, have the potential to improve
how we approach the conventional supply chain.
Inflation is a measure of the rate at which prices in the
Inflation
economy rise. Inflation in the supply chain can have a
knock-on effect on prices. As this period continues,
businesses must brace themselves for cost increases
in the procurement of raw materials, finished goods,
and other items. These rising costs frequently result
in excess or surplus inventory, rising storage fees,
smaller margins, and lower revenue for your product-
based brand.
Material Scarcity
Inadequate factors of production have been a
concern since the pandemic began, due mainly to
an unprecedented increase in consumer demand.
Even now, retailers and suppliers are struggling to
meet this demand due to the limited supply of
many components and resources.
Increasing freight prices
This demand was much greater than anticipated by
the pandemic; it was met with inadequate shipping
capacity and an astounding deficiency of empty or
easily accessible containers. This has resulted in a
significant increase in pricing, as it frequently does.
Freight rates from China to the West Coast have
increased by 240% over the past twelve months.
During the pandemic, consumer attitudes and
Changing consumer behaviors changed dramatically, such as lowering
attitudes the bar for order fulfillment and raising the bar for a
favorable client experience. The challenge is to
have an adaptable supply chain that can utilize the
potential of automation to optimize fulfillment and
easily handle rapid demand.
Recommendation
The best approach to implementing digital supply chains combines cutting-
edge technologies with redesigned operations. Many managers will be familiar
with the basic transformation approach: creating a vision for the future supply
chain, assessing the current state of the supply chain, and developing a
transformation blueprint. This approach has some new features in a digital
transformation. The vision will include both neither improvements and more
speculative changes that can be sought over time. An example is the LEGO
Movie, its Batman spinoff, and various games increased the company's profits.
These media successes were then expanded upon by incorporating them into
actual product offerings, resulting in a consistent experience for all of its
customers.
Businesses should assess the resilience of their supply chains, including
the financial health of their external providers. High inflation rates may
cause financial difficulties or a shift in behavior for some. They must also
carry out a comprehensive risk assessment of their strategic partners and
sub-suppliers to determine which risks may have an impact on the supply
chain as well as company resilience. Cost increases due to inflation have
an incremental effect on the supply chain, and if a company is exposed to
these increases, it could be necessary to rapidly comprehend the
consequences and have response procedures in place.
To mitigate and prevent material shortages, a company must examine the
supply chain work management resolution history to identify the most
problematic processes. They should strengthen their relationships with
suppliers and stimulate them to disclose potential issues promptly, with the
understanding that no issue is too small to report. For example, the
partnership between Coca-Cola and McDonald's is strengthened by the fact
that both companies are industry leaders. Coca-Cola is the largest supplier
to McDonald's, and McDonald's is the largest customer of Coca-Cola.
Companies must cultivate relationships. Shippers gain transportation
management advantages that have bottom-line significance when they
develop more strategic, longer-term carrier relationships. Longer-term
provisions allow the carrier to deposit for other local consumers, resulting in a
more efficient network with fewer deadhead miles. A carrier that maximizes
asset utilization is more profitable and therefore can afford to offer reduced
rates. J&T Express has formed a partnership with Shopee, which strengthens
its business operations and encourages it to provide quality services to the
Philippines' growing number of online sellers and buyers.
Businesses must comprehend their customers' wants and needs. They
must be realistic about the situation and the evolving consumer behavior.
People in this situation benefit from providing valuable content.
Furthermore, providing products that are both affordable and necessary is
essential. In line with this, they would have to provide support and
encouragement through promotions, as well as introduce relatively secure
ways for customers to obtain the products they demand. Coca-Cola, for
example, is leveraging digital content and e-commerce strategies to
maintain visibility in key areas online through Brand Awareness.