A vision of visibility
?a?layan A.
Visionary, transformational leader in Industrial AI, delivering industrial transformation, accelerating growth and innovation. Board Director, Board Advisor.
As I shared with you in our latest Changemakers video, I have an engineering background and I grew up with this notion that the optimization of a part will always suboptimize the whole. Within the supply chain, advanced technologies—including cloud and edge computing, IoT, AI, machine learning and mixed reality—are the keys to driving the improvements, optimizations, and innovations that will transform the whole.
Discussions of visibility within the supply chain traditionally referred to where a product was along the linear path from raw material to end user. But the kind of visibility that I am talking about does more than answer the question “where is it?”
The kind of visibility that is possible with digital transformation turns your supply chain into a smart, agile, and interconnected network of partners and processes, helping you answer questions like “How can my supply chain be more dynamically responsive and optimized to help meet supply and demand?” “How can I see across my end-to-end supply chain in real time?” “How can I unlock higher service levels and optimize costs?”
Focusing on answering these questions will help you not only determine the maturity of your supply chain, but also what you want to track and measure to realize the business goals.
Adapt quickly and operate sustainably with a predictive supply chain
So where do you start?
Focus on visibility and agility. An agile supply chain empowers you to understand and act on real-time information from the entire digital ecosystem, including third-party data sources. This ensures that you will always have the right resources – inventory, people, equipment - at the right place and at the right time.
Disparate systems and databases create data silos. Creating a digital thread of data is the first step toward digital transformation. For example, IoT allows you to monitor the status of product, equipment, shipping conditions, weather, etc. This data can be combined with the intelligent cloud to provide visibility for raw materials, production orders, inventory status and so much more. Machine learning then empowers prescriptive resolutions to supply chain challenges, taking prioritization and impact analysis into account.
A tremendous example here is Daimler Truck North America (DTNA). They are using Microsoft Dynamics 365 Supply Chain Insights to bring together data coming from trucks, in-house ERP and supply chain systems, and suppliers, to gain actionable insights and optimize operations on the production floor as well as across the supply chain. Now, DTNA can break down silos by inviting suppliers to share real-time supply chain data.
Farmlands Co-operative is another best practice in terms of how to unite data silos They are using Dynamics 365 Supply Chain Management to bring together disparate systems, allowing them to more accurately match supply and demand and provide an enhanced customer experience. Operating on a single system has provided better supply chain visibility and allowed Farmlands to build one consolidated national inventory.
The Microsoft Dynamics Supply Chain module has helped Farmlands plan, procure, and transport inventory more quickly and efficiently according to Andrew Horsbrugh, Director Agri Products and Services at Farmlands. Andrew tells us “Clearer oversight means the business has been able to reduce their number of SKUs by 50 percent and overall inventory by 4 percent, which has had a positive impact on cash-flow. Deeper real-time insights mean we now have the right product at the right place at the right time. We’ve been able to build customer satisfaction and increase sales, all with lower inventory levels.”
Supply chain control tower capabilities can also be used to contextualize data to provide intelligent and actionable insights that help you mitigate impacts and risks. Our customers have seen incredible results by implementing a control tower: Up to 30% reduced expediting expenses, 10% reduced inventory and 60% increase in planning efficiency.
Let us look at one compelling example. In March 2021, the Suez Canal—the world’s most vital shipping route—was blocked for six days, leaving thousands of companies scrambling to crisis manage and plan their response. Leveraging their Luminate Control Tower platform, our good partner Blue Yonder helped several of our joint customers affected by the crisis adjust their supply chains in real-time. Blue Yonder was tracking over 200 containers with $500 million (USD) worth of products on more than 30 vessels.
Blue Yonder’s cross-functional team gathered real-time information through several sources, including daily news, weather updates, sensors installed on containers, and GPS. Using the Luminate Control Tower’s capabilities, Blue Yonder was able to predict the arrival date of their customers’ goods at the intended port and the cascading delays that customers may have to face. They were also able to show the impact of the delay on the production capacities, sales, and eventually on the lives of their customers’ customers in real time. Incredible! We are proud that Blue Yonder has chosen Azure as their platform of choice for all engagements.
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Unilever is also doing innovative work to better understand and leverage signals from the digital ecosystem to predict and prescribe responses to future supply chain disruptions. They are using AI, IoT, the intelligent edge, and digital twins to digitally rewire their supply chain, focusing on generating real-time, democratized information that will allow the company to readily predict and respond to whatever the future holds.
And it is possible, thanks to advanced dashboards, to take information from across the global supply chain network, factories, systems, and warehouses and deliver meaningful business insights to all necessary stakeholders whenever and wherever they need it. All the way from the supply chain analyst up to the executive boardroom.
Another interesting outcome of supply chain visibility is around ensuring equity and sustainability, such as the work HB Antwerp in Botswana is doing with blockchain. Their embrace of this technology in the diamond mining industry gives visibility into all facets that go into a stone’s creation—including the environmental and social impact of getting it out of the ground. This allows the government of Botswana to accurately calculate a diamond’s true “cost” and blockchain’s security ensures they are paid a fair price for the stone. Now Botswana knows how much value they are creating, and how much is staying in the country to help improve lives for its citizens. It is a fascinating story.
And here at Microsoft, we know about supply chain transformation, because we have lived it. We are a manufacturer in our own right, operating two advanced supply chains, one for data centers that power our cloud offerings and one for our devices manufacturing. Five years ago, we used our own technology to completely reinvent our supply chain, moving to create a single version of truth and building a data-driven culture that allows us to predict and prescribe outcomes. We can find our goods in minutes in case of a disaster, reroute them as needed and inform our retailers and customers very quickly. We can track our carbon footprint across materials, partners, and usage. The results are significant:
How to get started
Supply chain visibility as part of a digital transformation journey is within reach of businesses in every industry. The first step is to assess where you are. Is your supply chain reactive, only changing out of necessity? Or have you taken some steps toward visibility but are stalled? Once you know where you are, the second step is to find a partner who can help take you the rest of the way.
We can be that partner. Microsoft’s first party solutions—along with our own rich ecosystem of partners that includes BlueYonder, o9 Solutions, AThingz, Cosmo Tech, ParkourSC, PTC, ToolsGroup, and many others—has helped many businesses achieve the kind of end-to-end visibility that does more than affect outcomes, it changes lives.
To start your journey toward a digitally transformed supply chain, below are a few additional resources to help you get started.
In the meantime, you can stay connected with me here on LinkedIn and on Twitter. I also invite you to join my Art of Possible video series, where I will be talking more about innovation, transformation, and leadership.
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Microsoft Changemakers Episodes
Microsoft Supply Chain Resources
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