This is the second blog post in our three-part series discussing ways to improve supply chain collaboration.
In my first blog post in this series, I touched upon one of the biggest challenges companies operating global supply chains face today. I’m talking about the disconnect between the data, processes and people in the supply chain and how it inhibits collaboration and the ability to make the best decisions quickly. My last post focused on connecting data. So today, I’m going to do a deeper dive into connecting S&OP processes.
The challenge: Disconnected sales and operations planning processes
Today’s supply chain processes and functions operate in silos. What I mean by “silos” is that, across organizations, managers are responsible for one specific department, each with different priorities, responsibilities and objectives. As a result, managers aren’t aware of what other departments are doing in terms of their goals and priorities. When operations are siloed, there’s an absence of communication and collaboration between departments, divisions and business units. Each takes a vertical approach to reporting. Individual, functional metrics are tracked, instead of taking a horizontal view that gives insight into the health of the supply chain network and interdependencies of the individual functions. Consider these questions…
- How many companies would commit to a demand plan creating a 50% overload on a critical resource?
- How many organizations would take steps to deliver an order on time at the expense of margin?
Making these kinds of decisions requires easy access to demand, supply, capacity and inventory data. But having the right data is only one part of the equation; having the right processes in place is another. If organizations spend too much time firefighting and too little on exception management, their decision-making abilities will be hindered.
The solution: Cloud-based planning and response systems
Continuously planning, monitoring, and responding within a single environment increases collaboration across business functions. Companies that achieve this level of cooperation cut risks and make faster and better decisions. According to a recent TechValidate survey of supply chain stakeholders, 66% of respondents were able to achieve these benefits using a cloud-based planning and response system.1 Cloud-based solutions support the supply chain with the process orchestration and task flow capabilities organizations need to document and monitor processes. With data and analytics brought together in a single place, organizations have the ability to plan concurrently. There’s no need to pass data from one silo to the next to get the right answer. All the analytics to support demand and supply balancing are always “on”, enabling stakeholders to immediately see the impact of any change or decision. If you want to learn more about how to connect supply chain processes to drive better collaboration, have a read through the eBook: 3 Ways to Improve Supply Chain Collaboration. Stay tuned for our next post about disconnected people are inhibiting supply chain collaboration. 1 Kinaxis TechValidate Survey, October 2015