GM of Trelleborg and a veteran in the engineering and supply chain industry with over 20 years of business management experience. (Views are solely mine)
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The pandemic has led to empty shelves, panic buying, truck strikes and many items returning to the shelves. Supply chain issues have had a major impact on every industry, especially production. Even as the industry is slowly making a comeback, our supply chain problems are far from over.
So before we come up with solutions for efficient manufacturing strategies and optimizing the supply chain, we need to understand the issues our customers face. The supply chain starts with the raw materials supplied by the supplier to a manufacturer of a product/solution and ends with the delivery of the finished goods to the customers. Manufacturing and supply chain are very closely linked, and efficiency solutions require us to look at the end-to-end value stream rather than just a portion of it.
That begs the question: what do our supply chain and manufacturing customers really want, and how can software companies help with that?
As an expert in engineering, manufacturing and supply chain, I have identified four of the key areas where customers need help.
1. Supply Chain Resilience: Suppliers and Vendors Framework
For example, if a company manufactures a product for use in critical applications, a lot of due diligence must be done to qualify suppliers and vendors who will provide the raw material to manufacture those parts. With lead times ranging from 6 months to a year, supply chain teams face the challenge of sourcing their inventory and having backup for their current suppliers. Suppose a supplier does not supply a critical raw material, where else could the material come from? Are there substitutes or alternatives? Is there a supplier network? Are there other companies in the network that have a surplus? Where is this information available if your WMS/ERP system plans the material handling tasks within your facility?
What can supply chain software companies do?
• Create a solution for a system that can connect to suppliers/suppliers in the network.
• Identify surpluses in the network that can be traded between companies.
• Identify partners who can provide alternatives/substitutes.
• Discover new opportunities by understanding and predicting the behavior of a network of suppliers (predictive analysis).
• Ensure this solution works seamlessly and agnostic in WMS/ERP solutions.
2. Supply Chain Financing
Buyers and sellers in the supply chain sometimes have interests that resemble a tug-of-war. Buyers often want to pay as late as possible and suppliers want to be paid as early as possible. With global supply chain transactions from trillions of dollars, it becomes urgent to build a supply chain financing solution to bridge this gap. This also helps companies optimize their working capital.
Debtor financing and buyer solutions have been around for a while, with banks taking center stage, and a few players are offering buyer solutions. Today, customers need solutions that give them faster access to cash, longer payment terms for suppliers, a streamlined procurement process, and faster cash conversion.
What can supply chain software companies do?
• Create an analytics-based solution that can work with ERP history on materials, deliveries, invoices and purchase orders to make recommendations from suppliers that are a great target for buyer/supplier solutions, including early financing.
• Integrate financial processing solutions with the rest of the supply chain, including purchasing, shipping, invoicing and receiving.
3. Automation and Robotics
Every manufacturing and supply chain business needs automation, and robots are a great way to solve the efficiency and labor issues these industries face on a daily basis. However, the application of robots in facilities is numerous (and usually needed at the same time), whether in machine care, material handling, receiving, shipping, assembly or packaging. What many customers really want is a centralized system or solution to seamlessly manage these bots.
A machine-tending bot could be from one company, while an autonomous mobile robot (AMR) could be from a completely different type. Not to mention that assembly bots can be a combination of bots deployed to automate the assembly line. For the head of operations and supply chain, who has to ensure a seamless flow of goods from receipt to shipment, I think the biggest help would be for the bots to work seamlessly with the WMS/ERP system and talk to each other.
Suppose a package is assembled two days after the machine has been manufactured and the AMRs take it off the shelf, it would be helpful if that information was available in advance for effective planning and optimization.
What can supply chain software companies do?
• Let these bots talk to each other.
• Ensure software is bot independent and can work seamlessly.
• Integration with WMS/ERP software.
4. Visibility and transparency
With a growing awareness of sustainability and social responsibility, the consumer base often wants visibility and transparency about how their products are sourced. The ability to trace a product back to the raw material, the machine it was produced on and the details of the lot number is becoming increasingly important, especially around critical applications. Today’s customers don’t just want to know where the packaging is, many want to know everything about the product life cycle.
What can supply chain software companies do?
• Provide traceability of batch numbers for raw materials in the ERP system and the ability to make recommendations via AI during material handling, ie issuing a material from a traceable lot to a customer order.
• Build a trace-and-track application that integrates into the system to track the health of the product shipped to the customer, ie humidity and temperature tracking, to name a few.
Moving forward
Many consumers have never been more aware of the challenges associated with the supply chain in the manufacturing industry. There are opportunities for supply chain software companies to listen to the voice of the customer so that we can find creative solutions.
Opinions are my own only and do not reflect the views/opinions of any of my current and past employers.
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