Risk Management in the supply chain environment

Recent events, in South Africa, have highlighted the need for businesses to take advantage of technological advancements and have electronic, automated systems in place, to monitor daily processes and assets in the supply chain environment.
While human intelligence and intuition can be beneficial, manual processes are tedious and prone to inefficiencies.
Technology can minimise a dependency on people, and allow resources, processes and vehicle monitoring to be managed and monitored centrally, providing full visibility regarding all aspects of the supply chain.

Supply chain digital twin
A technology-enabled business can now establish “control tower” capability via a digital twin.
A supply chain digital twin is a virtual simulation model of real-world supply chain activities. It is used to analyse supply chain dynamics and to predict process success via real-time data of planned and released work and sales orders, deliveries, pickups, ePod’s and approvals.

The data is gathered from various technology sources, including:

• IoT devices like telematics, sensors and Artificial Intelligence (AI) cameras;
• Logistics and transport databases that are integrated between business partners;
• Business-to-business operational databases that share order-related and electronic deliveries in near real-time;
• Automated and integrated vendor information; and
• User experience feedback, online reviews, customer service tickets, social media platforms and real-time messaging platforms.

Risk mitigation assistance
Some of the use cases of digital twins in the supply chain environment that assist in risk mitigation include:

• Planning of transportation and facilities. Various technology platforms can be utilised, to establish a digital twin of the supply chain environment, that can assist in planning demand from customers. Real-time data is used by these platforms to monitor physical assets, people and locations, to assist supply chain managers to better plan and react to variable demand, facilitating optimal usage of these assets and ensuring on-time delivery in full (OTIF) to customers. These automated and integrated technology platforms can help businesses better minimise risks in their supply chains, through alert functionality for deviations against the plan, in real-time. This includes, by way of example, new on-demand orders that require fulfilment, drivers running late due to traffic congestion, vehicle breakdowns and loading or off-loading variances against the schedule.
• Optimising inventory. The supply chain digital twin platform can utilise data, from the demand forecasting function, to avoid stock-outs and assist in minimising overall warehousing costs. It can also help address challenges experienced in “single-echelon” – optimisation of inventory in a single warehouse – and “multi-echelon” inventory systems – optimising inventory across the network. Other use cases that can benefit from this technology depend on the supply chain demands and needs. However, there are challenges around the establishment of successful supply chain digital twins, including data quality and technology adoption.
• Data quality. First and foremost, the data quality of the real-time data feed needs to be trusted. As the precursor to the success of the planning and execution functions, the reliability of both technology and vendors is paramount to data integrity. Various Artificial Intelligence and machine learning technologies exist, that can assist supply chain managers to ensure that usable information is indeed correct and reliable.
• Technology adoption. Even with such advancements available, various industry verticals may be hesitant to embrace these new technology platforms. Complexity can be a hurdle, but with a credible vendor as a business partner, a move in this direction can be leveraged to assist supply chain managers in optimising processes and minimising risks within existing supply chains.

Streamline your supply chain
Correctly configured, and optimally utilised, technology can very quickly pay for itself and contribute not only to risk mitigation but immeasurably to revenue growth, cost minimisation initiatives and positive customer sentiment.

There is no time, like the present, to partner with a trusted technology vendor to vitalise and streamline your supply chain.

Kobus Visagie
Executive: Business Solutions
Tracker