In a pre-Amazon world, supply chain optimization focused on investments in the design phase – how to get the lowest trucking costs, where to locate the warehouse and how to ensure inventory was in the right place at the right time. This worked because the world moved at a slower pace and change was manageable. Emerging technologies – artificial intelligence (AI), cloud, blockchain and the Internet of Things (IoT) – have created a different landscape. Customer demands have evolved. Sustainability issues are critical. Supply chains need answers in real time.
Today we live in an increasingly complex global network where events happen fast. Traffic exceptions, natural disaster exceptions, customer complaints leading to image problems, and more. This creates uncertainty. How do you manage it? How do you enable decision making across the supply chain? No matter how well you plan, the forecast can go wrong.
Supply chain optimization keeps supply chains on schedule — even when conditions become less than optimal. Like when there are unexpected disruptions to a local labor supply, or when extreme weather events impact distribution, or when a looming medical crisis forces a company to rethink how it transacts business globally. Supply chain optimization helps keep your operations steady, despite potential disruptions.
Supply chain optimization today uses technology to provide superior exception management. It’s key to remaining competitive. Businesses have better visibility across the supply chain, and better decision-making capabilities in real time – not just across their own organization, but across the entire business partner ecosystem.
Another factor in the evolution of supply chain optimization is this movement toward business networks – communities of trading partners who work and communicate on business processes that extend across multiple enterprises, with an end-to-end shared focus.⁵ These multi-enterprise business networks (MEBN) facilitate better business processes through real-time collaboration.