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6 Ways to Future-Proof Your Supply Chain

Guruprasad Gaonkar
JAPAC SaaS Leader – ERP & Digital Supply Chain

What will supply chains look like in the future? People envision unmanned vehicles zipping around crowded streets and overhead drones dropping packages on doorsteps. Whilst autonomous delivery will certainly be part of the future supply chain, the most meaningful changes are taking place behind the scenes: modern cloud applications for supply chain management (SCM) are helping supply chains transform so they can flex and respond as new technologies emerge and customer expectations change.

Supply chains have a huge effect on performance of product-based businesses. Globalization and the evolution of worldwide logistics infrastructure have driven exceptional levels of trade growth – and specialization by suppliers. E-commerce has revolutionized customer interactions. The result? Most supply chains are now hugely complex. They’re longer, more diffuse and operate at the finest tolerances. So alongside efficiency and agility, they’ve also heightened risk and fragility.

The good news is that hyper-connected systems, increasing automation and real-time analytics boost the upside – and mitigate the downside. The World Economic Forum’s analysis suggests 75% of manufacturing, logistics and retail businesses attain positive financial impacts from digital technologies in their supply chains.

One reason for this is the volume of data that any supply chain generates. Properly collated and analyzed, this can enable operational teams to optimize around customer needs; and finance teams to make much more accurate forecasts – as well as gain strategic insights for future change. 

We look at some of the ways to deliver these benefits in the eBook Accelerate Innovation and Agility Across Your Supply Chain. But the one I’d really like to focus on here is: “Commit to modernizing with cloud.” Why is that?

The problem with on-premises SCM is that it’s typically limited in scope. Because of its siloed data structures, users typically lack visibility into all supply chain processes, and can’t easily share information among functions to allow everyone to quickly and easily adjust to changes.

One alternative to address this deficit is an end-to-end SCM application on a cloud platform offering a single view of the whole chain, from customer orders and fulfilments, to supplier capacity and upstream logistics. (Ours is called Oracle SCM CloudIDC found customers had a five-year ROI of 267%, 12-month breakeven and 28% higher productivity in supply chain teams.)

Adopting such an end-to-end SCM application in the cloud effectively creates a digital thread that connects products, services, suppliers and assets with customers, employees and partners. The result is real-time visibility in all the different parts of the supply chain, instant communication and more control.

Here are six characteristics of adaptive and agile supply chains

  1. Powerful cloud-based applications

Cloud solutions mean supply chain and finance decision-makers and operators can:

  • Work across systems and devices. Everyone, anywhere can keep tabs on data, tasks and process hand-offs. This is particularly valuable for organizations with diverse businesses and locations. Iraq’s Salahaddin Investment Holding Co., for example, operates in a range of sectors with several subsidiaries. Cloud applications allows for simple connections between their various supply chains – and much simpler consolidation of group data.
  • Analyze large amounts of data and provide rich insights to supply chain stakeholders.
  • Use mobile collaboration capabilities to streamline processes, work more effectively, and connect instantly regardless of location.
  1. Integrated emerging technologies

Cloud-based SCM isn’t limited by the tech infrastructure deployed in any given location. That makes it much easier to layer in advanced technologies such as artificial intelligence (AI) and machine learning (ML). This means processes can be automated, for example; or allows for predictive and prescriptive modelling and recommendations, building on real-time analytics. Many emerging technologies – such as blockchain for private trading networks and track-and-trace capabilities – are only possible with hyper-connected supply chain systems running in the cloud.

  1. Easily accessible information

Cloud solutions provide real-time visibility into the supply chain – from inventory and order status, to shipments and working capital. Alerts about status changes that might negatively affect business outcomes can be generated and shared immediately. Embedded analytics and Internet of Things (IoT) connectivity means decision-makers can use cloud-based SCM to gain insights into activities and events that would otherwise be invisible. For example, changes in temperature and humidity in a container of environment-sensitive goods can be monitored in real time and then automatically actioned when thresholds are breached.

  1. Scalability and security

New users can be added to cloud-based systems faster and without technology requisitions. That’s valuable for supply chains with seasonal spikes in demand, for example, or businesses that need to roll out new lines quickly. A cloud-based warehouse management system (WMS) can proactively manage seasonal inventory overflows and optimize supplier actions, inventory management and logistics. On-premise WMS deployments are reactive and far less responsive. That was certainly the experience of Australian wine retailer Vinomofo, which achieved 99.6% pick accuracy thanks to streamlined order fulfillments with Oracle Warehouse Management Cloud Service.

Supply chain data is both critical to operations and commercially sensitive. Cloud SCM outsources both uptime and security to service providers with the scale and expertise to invest in world-class connectivity and access control. Administrators can apply patches immediately to address any emerging cyber threats, for example.

  1. Easy-to-maintain and update systems

It’s not just security patches. Every aspect of managing SCM applications is easier in the cloud versus on-premises: adoption, use, management, configurability and upgrade. Better still, end-to-end cloud platforms also mean adoption of SCM functionality isn’t dependent on the core ERP installation. Instead, cloud SCM relies on standardized interfaces into the parent ERP system – which means users can rapidly change business processes or adopt emerging technologies without waiting, sometimes for years, for a major ERP implementation or upgrade to be completed.

  1. A partner that understands your business

More power; cutting edge supply chain tech; better analysis and insight; faster, simpler innovation; and more agility. But all these cloud benefits rely on a cloud partner with both deep technical skills and a sensitivity to business priorities – and especially rapidly evolving supply chain best practice.

At Oracle, we’ve seen how customer expectations have changed as supply chains have become more critical and more complex. Customers expect real-time visibility of the fast and safe delivery of their goods, regardless of whether they are ordering cheap household consumables or millions of dollars in industrial equipment.

Legacy on-premises SCM applications simply can’t provide the capabilities needed to make this transformation, but modern cloud-based systems can. An end-to-end SCM platform, such as Oracle SCM Cloud, integrates information into one place and provides deep visibility and control, so that supply chains can flex to meet changing demand and conditions.



 

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