Supply chain thinking must change, say experts

© Maksim Kabakou – 123RF.com

Prominent supply chain analyst and founder of Supply Chain Insight, Lora Cecere, believes that supply chain professionals have defined their processes as linear and inflexible; trusting enterprise resource planning (ERP) and advance planning and scheduling (APS) to optimise production and distribution processes.

“To become digital, we need to define processes from the customer’s customer to the supplier’s supplier and use new technologies to listen, sense, and adapt,” explained Cecere. “This is not the platform of traditional technologies and the belief structures of traditional supply chain leaders. This is an opportunity for Africa. Consider the adoption of cellphones, alternative payment structures and collaborative sharing in economies such as in Nigeria. It’s time that we question the status quo and traditional principles.”

Cecere will in June join Flatiron Strategies’ senior industry analyst, Peter Vanderminden; and Oracle’s digital supply chain expert, Maha Muzumdar; to speak at the 38th Annual SAPICS Conference and Exhibition for supply chain professionals, to be held at Sun City from 12 to 14 June 2016.

The trio, while encouraging organisations to pursue a digital supply chain, accept that this progression isn’t without flaws that businesses must take cognisance of.

Potential data security risks

While the emerging IoT (Internet of Things) delivers huge dividends, it also presents potential data security risks for manufacturers as numerous corporate assets and end products will be linked via networks to provide a steady flow of real-time data. As data volumes and internet connectivity grow in the supply chain and on the manufacturing floor, there is increased risk of data security being compromised, cautioned Maha Muzumdar, vice-president of industry transformation of the Oracle Cloud Business Group.

“Manufacturers today need to be more vigilant of intellectual property and trade secret violations and potential corporate espionage,” added Muzumdar. “Today, there are new security issues for companies to deal with as automation and data volumes increase. Data security needs to be addressed at multiple levels - the enterprise level, the shop floor level and at the user device level. Companies need a comprehensive portfolio of security strategies, such as identity management, access management and mobile security to ensure data privacy, protect against internal and external threats, and enable regulatory compliance.”

Effective use

While IoT devices – such as digital sensors – forgo the need for the manual input of data, thus achieving greater accuracy, businesses must also be able to use this new flood of data effectively. This, too, can present a problem, explained Peter Vanderminden, senior industry analyst of Flatiron Strategies

“This does result in a flood of big data, which organisations may not have the capability to analyse and use effectively. That is where the breakdown often happens. As you implement IoT capabilities into your products, making them digital, it’s all about how we bring both these worlds together – converging IoT operational with traditional SCM IT and bringing the physical and digital supply chain together,” he said.

For more information on #SAPICS2016, or to register, go to conference.sapics.org.