Five Supply Chain Inefficiencies Solved by Modern Cloud Applications
It isn’t an exaggeration to say that Modern Cloud Applications have transformed, perhaps even revolutionized, companies’ ability to develop the responsiveness required to meet the challenges of today’s high-speed supply chain environments. The efficiency of Modern Cloud Applications provide small- to medium-sized businesses a competitive platform while offering enterprise-sized businesses the opportunity to become nimbler, allowing business of all sizes to amplify innovation at increasing speed. Modern Cloud Applications give companies a crucial edge in a fiercely competitive world, and allows them to spend more of their time, talent, and energy on further developing their core strengths.
Here are five specific supply chain inefficiencies that can be addressed by leveraging Modern Cloud Applications:
- Supply Chain Latency: In many industries, the speed of business has exceeded the ability to develop and keep current a feasible, usable plan.
- Reliance on Outdated Information: Antiquated supply chain technology is still heavily utilized, making it impossible for most companies to get timely, relevant information required to consistently make good supply chain planning decisions.
- Segregated Planning Functions and Data: Despite S&OP being around for decades, many companies rely upon functionally-specific data with multiple user experiences and therefore often make localized planning decisions without visibility or knowledge of downstream impacts.
- Tedious Analysis and Evaluation of Scenarios and Alternatives: Even if supply chain information is available and accurate, most companies struggle with being able to extract maximize value from it.
- Time-Consuming Resolution of Supply Chain Exceptions: The four inefficiencies above can make investigation of exceptions a slow process, and can potentially result in inaccurate or inconsistent resolution.
After we describe more about each of these five inefficiencies, we’ll share how we can help.
#1 Supply Chain Latency
In any industry, if a company wants to be agile and responsive, then technology, processes, and data cannot be any kind of hindrance. So, 24/7 system availability, speed, and information relevance have become prerequisites to responsiveness. Any kind of latency in a company’s supply chain puts them at risk, and competitors who can react better and faster will quickly push aside those who cannot keep up.
In our high-speed global economy, the impact of data-loss downtime or lack of timely, relevant information (which should be considered interchangeable, since both imply periods of information blindness) can have enormous implications.
In a study that explored the cost of enterprise IT downtime as of December 2017, 24 percent of participants responded that just one hour of downtime or access to usable information would cost their company $301,000 to $400,000. Thirteen percent of them said that hour would cost them $401,000 to $500,000, with 11 percent putting the cost between half a million to one million dollars. And, another 33 percent say that just one hour of enterprise downtime would cost their companies somewhere between one and five million dollars. One hour!
Beyond the underlying technology justification, however, is the modernization of applications that have come along concurrently with the Cloud. Modern Supply Chain Cloud Applications in particular are built for speed and efficiency. If leveraged properly, these modern applications can give companies a technology speed and efficiency advantage that can propel them to an industry-leading level of responsiveness.
#2 Reliance on Outdated Information
Antiquated supply chain technology is still heavily utilized, making it impossible for most companies to get timely, relevant information required to consistently make good supply chain planning decisions. Point-to-point integration between multiple platforms is the norm; demand and supply planning data, for instance, often does not even reside in the same place. S&OP processes frequently are spread out over days, and part of the reason for this is because of the time required to gather, check, organize, and aggregate information in a meaningful way. Accordingly, many S&OP sessions occur where more time is spent questioning the validity of the information than anything else.
When supply chain information is available in Modern Cloud Applications, all you need is a mobile device and an internet connection to access real-time data. This eliminates the need to be tied down to any certain location—ideal when stakeholders travel and/or when they are located distantly from one another—and can eliminate business interruption when your company is experiencing hardware problems.
Plus, each stakeholder has access to the same real-time information, which eliminates the challenges companies can face when two groups of stakeholders are analyzing and making decisions based upon two or more sets of data—and this information is available 24/7/365. Compare that to when one group reviewed data, added input, and then forwarded that information to another group for their input, and so on. The efficiency boost that Cloud usage gives can be astronomical in scope when factoring in the potential for errors to be made when reviewing the wrong versions of documents and the delays encountered through the non-Cloud process.
The ease of accessing data streamlines collaborations, even globally, whether that collaboration takes place among members of your company from multiple supply chain functions—production, procurement, logistics, and so forth—and potentially with suppliers, brokers, and customers. Ease of collaboration allows relevant stakeholders throughout your company to break through silos to openly communicate, brainstorm solutions, creatively cooperate, and otherwise achieve commonly held goals.
Modern Cloud Applications that support S&OP not only provide a single platform for all planning data, but they also provide the opportunity to plan and evaluate scenarios at any of the multiple levels of their product and customer/location hierarchies.
#3 Segregated Planning Functions and Data
Despite S&OP and Supply Chain Planning applications being around for decades, many companies rely upon segregated, functionally-specific data with multiple user experiences, and therefore often make localized planning decisions without visibility or knowledge of downstream impacts. Complex integrations between the functional silos are often required, regardless of the technology applied, because it takes time to move planning data, imbedding inefficiency in every supply chain planning process that requires refreshed data.
Modern Cloud Applications that support Supply Chain Planning functions are now on a single platform, with a common set of data and a single user experience. This approach not only provides high visibility throughout the entire chain, it includes both demand- and supply-side planning information, along with any other forward-looking planning data required to support the planning process.
To have a truly agile and responsive supply chain planning organization, relevant information must be centralized, standardized, and readily available. Planners need a command center, a hub of common visibility, a single workbench from which all planning activity can commence.
#4 Tedious Analysis and Evaluation of Scenarios and Alternatives
Even if supply chain information is available and accurate, most companies still struggle with being able to extract maximum value from it. Many companies rely upon the IT department to generate reports to support their planning functions, and many still manually extract data into external spreadsheets where they can easily create dashboard-style depictions of the data and assimilate rough-cut scenarios for comparison. This is the epitome of inefficiency, both in the amount of time required to create this off-line information and in the added risk associated with the inevitable errors that occur.
Modern Cloud Applications for supply chain planning will include embedded analytics, bringing the sophistication of business intelligence into the application itself; and, foundationally, they are constructed to support easy generation of multi-level scenarios for evaluation and comparison, plus the ability to quickly run event simulations, without ever exiting the application.
The beauty of the Cloud lies in its seamless availability. With Modern Cloud Applications, S&OP and supply chain planning activities can occur at any time. Whether that means generating scenarios, running event simulations, or something else entirely, whatever the need, it can be done on demand, event-driven or planned or ad hoc. And, with Modern Cloud Applications being on a common data model and platform, planning decisions and refinements can immediately be published for the execution. What used to take days, or hours at best, can now be done in minutes. And with the speed of business today … this is how companies can become agile and responsive.
#5 Time-Consuming Resolution of Supply Chain Exceptions
The four inefficiencies above can make investigation of supply chain planning exceptions a slow process, and can potentially result in inaccurate or inconsistent resolution. Even if these inefficiencies are addressed and information has become timely, reliable, and relevant, there still may be enough complexity in the exception scenario or event that it takes a lot of time to find a resolution. In a supply chain environment where minutes can matter, speed of resolution becomes critical.
Modern Cloud Applications can address this need. The days of the massive engine algorithms to help generate “optimal” plans are largely behind us; however, simpler and faster adaptive versions are often imbedded in today’s Cloud applications, providing the opportunity to allow the technology to offer guided resolution to supply chain exceptions. Modern applications can not only identify the exception the moment it is created, but they can also leverage rules and logic that holistically considers downstream impact and suggests a resolution based on the current parameters.
The recognized leader in Cloud technology is Oracle. What most fail to consider, however, is the modernization of applications that has occurred as Oracle has led the move to the Cloud; “fusion” has been in progress for many years, its maturity merely enhanced by the technological infrastructure the Cloud provides. It is this combination of Oracle’s modern application design alongside the power of Cloud technology that has become the enabler of world-class supply chain responsiveness.
To demonstrate a sample opportunity with Oracle’s Cloud Applications, we’ll look at one specific aspect: demand planning. In a recent blog post, we noted these key benefits:
- When you do demand planning in Oracle’s Cloud Applications, you no longer need to manage the supporting IT infrastructure or costs of on-premise upgrades and so forth. This automatically reduces the areas in which decisions need to be made, allowing key stakeholders the ability to focus on the decisions that will help your enterprise grow and thrive.
- Because you will have access to exactly the data you need, right when you need it, the common planning information platform offered by Oracle enables collaborative decision-making capabilities.
- Companies can provide laser-targeted market demand responses, including efficient responses to spikes and drops in demand, even when market conditions are volatile.
How CSS Can Help: The CSS-Oracle Advantage
If your company is ready to explore the benefits of the Oracle Supply Chain Management Cloud, the consultants at CSS are the experienced choice. Our consultants have deep industry knowledge in supply chain management, with an average of 20 years of experience. We combine the very best in Oracle wisdom while offering practical, hands-on insights, with our goal being to always keep your business moving forward.
If optimizing your supply chain, perhaps globally, is an enterprise priority, then we invite you to contact us online or call 1-800-814-7705. We offer experienced consulting, implementation, logistics management, and integration services, tailored to your company’s unique needs. Because of the low turnover at CSS, you can count on resource consistency throughout.
The Oracle consultants at CSS excel in filling in the gaps, implementing exactly the right supply chain solutions for your needs, and we integrate your processes in a way that provides outstanding visibility across the entire supply chain. If you need industry-specific tools, we can collaborate with Oracle to create what’s needed.
Let’s talk! Contact us online or by calling 1-800-814-7705.