Updated: Apr 11
With COVID-19 impacting & disrupting global demand & supplies, people everywhere have been worrying about the supply chain. Items have been out of stock at stores for weeks, shortages in crucial categories and more critically medical safety equipments have been all over the news. At the same time, with offices closed and most people staying & working from home, demand for other types of products has risen precipitously. How will companies handle continued uncertainty and fluctuations in consumer demand?
Clearly, COVID-19 crisis poses many new challenges to supply chain planning. Some companies were able to react swiftly to these challenges (thanks to their advanced supply chain capabilities) while others, it was just the beginning of supply chain transformation.
Within supply chain transformation process, we hear a lot about how companies need more visibility across the supply chain—especially in the wake of COVID-19, when so many supply chains broke down because of a lack of it.
This is where Supply Chain Control Tower comes into picture.
“A supply chain control tower is a central hub with the required technology, organization, and processes to capture and use supply chain data to provide enhanced visibility for short- and long-term decision making that is aligned with strategic objectives.”
Building a control tower that covers the entire supply chain is a huge strategic effort. Leadership teams can lay the foundations for a future control tower in a series of logical steps that deliver immediate gains. Successful companies look beyond discrete IT solutions. They develop a strategy that incorporates business objectives, available technology, the company’s legacy technology, supply chain processes, and governance.
Image source: Deloitte.
There can be various types of control towers that could be used within an organization, for e.g.:
Logistics/Transportation control tower: Offer direct visibility and insight into inbound and outbound logistics, including advance shipping notifications (ASN), deliveries, and track and trace, among other details. These solutions are usually tied into and complement Transportation Management Systems (TMS).
Fulfilment control tower: Aimed at fulfilment and order data integration to reduce cost-to-serve and help deliver the “perfect order” to customers more often.
Inventory control tower: Provide essential real-time insights to manage inventory more effectively with visibility and insights into imbalances, shortages, stock outs, expiring inventory and other related metrics.
End to End supply chain control tower: Deliver visibility across internal and external systems and processes. Depending on the industry and organization this may tie in suppliers, sales and orders, logistics and/or inventory.
Traditional vs Advanced control tower:
A supply chain control tower system is an attempt to make the outside supply chain environment visible to the enterprise, with “end-to-end” visibility being the Holy Grail.
A traditional control tower provides visibility to immediate trading partners only. The advanced, intelligent control tower is a hub for visibility, decision-making, and action, based on real-time analytics which monitor, manage, and control decisions and execution across functions and across companies to optimize the entire network.
The Intelligent Control Tower uses AI (Artificial Intelligence) and serves as a system of engagement across trading partners, and orchestrates companies, people and things to work together in real-time to serve the end consumer.
Until recently, supply chain control towers have been all about providing visibility to your immediate trading partners. But with the development of multi-party, consumer-driven networks, advanced control towers now provide real-time visibility, collaboration and powerful AI capabilities to move beyond decision-support to decision-making and autonomous control.
Supply Chain Control Tower Architecture:
End-to-end Visibility – visibility across supply chain partners, including suppliers, contract manufacturers, transportation carriers, third-party logistics
Real-time tracking through collaborative information sharing – share information and collaborate in real-time
Early warning alerts and exception management – resolve supply chain disruptions before they disrupt your business
Predictive and prescriptive decision-support – using predictive and prescriptive analytics
Autonomous decision-making and control – take the robot out of the human and boost productivity
Cognitive – the self-correcting supply chain with decision-making and machine learning
Maturity/Levels of a supply chain control tower:
Level 1: Visibility to all the events & milestones you want to track across the entire network
Level 2: Receive alerts based on SLAs and lead time tagged to all events and milestones, collaboration in real time to resolve the alerts.
Level 3: Execution transactions within the control tower. Control tower’s intelligence provides recommendations to make decisions.
Level 4: Intelligence embedded in the execution layer of control tower run the supply network without human interference.
Prerequisites of designing a supply chain control tower:
Define key business objectives
Set your priorities
Take an agile and modular approach
Embrace new ways of working
With current & upcoming market volatility the businesses demand the ability to deliver a digital supply. At the same time the technological advancement empowers us with that ability.
Building a full-fledged supply chain control that provides the expected end to end visibility of supply chain performance is definitely not a small project but more of a success journey. A strong strategic roadmap built around high priority business goals will definitely help organisations to start this journey because this is an exciting capability that should be a part of every organisation’s supply chain strategy.
Follow the author here: Saurabh Srivastav's LinkedIn Profile