The future of hi-tech supply chains

The advent of new technologies and distribution channels are forcing companies to rethink their strategies. Ahead of the Hi-Tech and Electronics Supply Chain Summit in Amsterdam this month, Logistics News ME catches up with some of the event speakers to hear about the latest trends

What is the biggest challenge which you’re currently faced with in the hi-tech industry and supply chain?

Baus: Within our sector the challenge is to keep up with the exponential evolution of technology. Our products are always connected to audio and video sources from other brands. In parallel we have developed an eco-system within our product range which allows our products to also communicate with each other through software. Defining an effective product road map which can hold pace with this multitude of ever changing variables is an ongoing challenge. Translated to our supply chain this means shorter lifecycles and more SKU’s to manage. Developing the right global footprint of factories and DC’s aligned with efficient sales forecasting is a constant challenge. Creating the right omni-channel experience for our customers makes this exercise more complex.

Hartung: The lack of ability of some of our business partners to provide data at a speed and accuracy so that it can be utilised to manage a digital supply chain.

Back: Managing a global supply chain that provides a responsive service to customers whilst coping with product, and import / export, compliance demands.

How are you executing a digital strategy within you supply chain?

Baus: Every supply chain needs to be effectively driven by demand. The multitude of customer touchpoints requires digitization of the supply chain. Using reseller portals, e-commerce, m-commerce, call centers, SAP within our retail stores and CRM platforms creates a massive flow of demand information which needs to be processed and translated into relevant forecasting and product planning. Currently we’re integrating all of these platforms on a global level with SAP.

Hartung: We are building a platform to accumulate and store SC data from throughout the ecosystem we operate in. We are augmenting this with predictive and prescriptive analytics, findings (both issues and opportunities) and pro-active alerts.

Back: By re-examining the data needs of internal processes, and by developing new ERP system functionality, with an emphasis on increased speed, reduced complexity, and increased visibility.
What does it mean to be “omnichannel” and what role does supply chain play in that?

Baus: The omnichannel possibilities within our sales environment are almost endless and the technology to fulfil these needs is available and mature. In this context supply chain can be the enabler or the hurdle to achieve our omni-channel strategy. Currently we’re developing a new fully integrated omni-channel strategy for which we’re building a new supply chain model.

Hartung: Omnichannel means having a flexible supply chain that can efficiently service clients at their desired service levels and needs. This covers from industrial clients to individual suppliers that want individualised products.

How are you putting the customer first in your operations?

Baus: We’re developing a supply chain model which shortens leadtimes and allows the customer to use his/her preferred way of purchasing and payment.

Hartung: All of our systems and operations are designed to provide and exceed the customers’ requirements.

Back: Distribution channel customers – by a focus on supply chain reliability and by providing information that supports the service they give to their customers. End-User customers – by investing in the development of products that increase business efficiency and give a quick return on investment, and by the support we give to end-users through our distribution channel.

Are you using predictive data analytics in your operations? If yes, what areas in your supply chain have you found the most beneficial from implementing this technology?

Baus: Our planning team uses APO to try to predict our sales forecast. Together with the sales team they finetune this first forecast into sales planning.

Hartung: Yes. Planning, inventory management. For the disruptive technology we foresee having the biggest impact on supply chain, look at  IoT, M2M, 3D Printing, Driverless Vehicles, etc.

Baus: In our sector the IoT will influence product development and our supply chain. Our products are connected with each other and also with other devices. The data generated by the inter-connectivity will drive future product developments, sales volumes and by consequence how we’ll need to structure our global supply chain.

Hartung: 3D Printing: this will change the entire supply chain and manufacturing models that exist today. IoT: as this will provide real time operational data (SC and factory floor) and product use by customer. Analytics: as this will identify opportunities and drive actions in ways and speeds that humans are unable to do today.

Back: IoT, M2M, professional mobile devices, and the Cloud. By synchronising these disruptive technologies, organisations will increase their Enterprise Asset Intelligence, through the ability to sense, analyse, and take informed actions, leading to increased supply chain efficiency and effectiveness.

If you could fast forward five years how will your supply chain look? Eg. What new technology will you be using and what benefits will this bring?

Baus: Unfortunately it’s very difficult to predict the future and five years is a lifetime nowadays. It’s clear that depending on our sales channel and product segment we’ll continue to tailor our supply chain towards the customer needs. In some cases this could result in direct shipments from plant to customer or use 3PL partners for certain specific supply chain activities.

Hartung: For some products there will be a more regionalised supply chain and manufacturing footprint. Mass customisation will be a reality. Analytics will be more important in executing the supply chain.

Back: IoT and Enterprise Asset Intelligence technologies, allied to advanced inventory planning tools. Supply chain visibility, that allows pro-active monitoring and well-timed corrective actions, allied to high order fill rates and reduced inventory investment, will be significant sources of competitive advantage.