Solution Is A Stop In The Strategic Journey

A solution is merely an interim stop or milestone in the journey that is your business strategy. Your strategy is your map that guides your way and methods of taking your journey, just like setting up a destination Google Maps with interim stops along the way. Your strategy must be capable of sensing changes and disruption early to be able to respond and most importantly to evaluate your interim deliverables, or solutions, required to meet your long term strategy. Perhaps most importantly, these adjustments in response to disruption allow you to evaluate your strategy to improve, update, improve and focus over time. The ability of your business and market strategy to sense and respond to disruption must also improve over time in order to survive. This, in essence, is a basic tenant of the continuous improvement process and this continuous process makes up the foundational framework to sense and respond to business, market and environmental disruption.

Supply chain network digitization has become a key factor in supply chain resilience with the need driven in large part by VUCA resulting in waves of disruption across markets. The number of companies seeking approaches to measure and benchmark their digital infrastructure and processes is growing as a result. In order to achieve the improvements necessary to support the demand it is important to incorporate tools that can assess, and perhaps most importantly, monitor the benefits and challenges resulting from the digitization process itself.

This is where real time federated networks and control tower capabilities come into play to provide the capabilities necessary to sense the disruption in time to respond to the issue and even recover in time to limit or even eliminate disruptive results. What we are seeing now is the impact from disruption causing additional waves of disruption that in turn impact the supply chain and dependent businesses. This does not need to be the case and should be a critical focus and objective to the supply chain strategy.

We are seeing now a realization of the continuous impact to the market as a result of the state of extreme VUCA we are experiencing. This is difficult to react and address because, frankly, if feels as if the market is in an almost continuous state of disruption. This requires a collaborative technology that brings together the extended partners across the supply chain on a foundation of a federated network that provides the means to collect and analyze the data generated across the supply chain in forecasting the disruption and then providing suggestions for reactions to the disruption. This is complicated by the volume of data available and necessary to analyze and forecast results and the speed of data generation from each of these data points

Control tower technology combined with machine learning and artificial intelligence combine to help to address the challenge. The technology is in a state now that can quickly and efficiently sense and respond to disruption by utilizing the large volumes of digital data through machine learning and artificial intelligence technologies to analyze and identify the disruption along with potential reactions and responses to the disruption. We have entered into a time now where large volumes of data that is collected and available for analysis can actually be processed in a manner and timeframe that allows the supply chain to respond. This is the power of control towers and this next logical step in the strategic journey to the benefits that can be achieved through a robust digitalization strategy.


Tom Brouillette

Contact: tom.brouillette@gmail.com



Thank you for reading my post on Linkedin in addition, Here at my blog I regularly write about management and -technology trends. To read my future posts on LinkedIn click 'Follow'
Tom Brouillette discusses supply chain trends and provides strategic business & technology advice to his followers and companies

RPA As Transitional Bridge To Digital Transformation

Digital transformation is a wide ranging and disruptive strategy that realistically will take years. This strategy will also define the framework that will regularly and continuously replace technology tools based on the changing demands and continuous waves of disruption in the market. You must accept and support this concept in order to be successful in developing a resilient supply chain that is capable of suppurting these transformation efforts. You must accept that there will always be strategic digital transformation initiatives that will focus on areas of greatest return in value. Maybe most importantly, this does not mean that you can afford to only focus on a small number of areas because you will be left behind in the dust of market disruptions.


This means that you must develop a method that will allow you to ‘bridge’ the gap between your current legacy technologies and new technologies that result from market and consumer disruption. One very robust method to bridge the gap is RPA because RPA technologies will allow you to automate processes through the use of technology tools that ‘bolt on’ integration and work flow management capabilities to legacy technologies. There are many examples of these capabilities that bring great value very quickly to your business that will allow you to focus on other strategic initiatives.


I think of RPA as a key tool in your continuous improvement process that will allow you to quickly and efficiently prove out your automation initiatives and strategy. We can no longer afford large initiatives of wholesale change and hope they meet the initiative objectives. We must have a way to prove out the process quickly and RPA provides the tool to support a more resilient and flexible supply chain.


I hear many people stating that RPA is ‘just’ a new and updated method of the old screen-scraper technology from the 90’s in an effort to detract from the technology and encourage the focus on what they feel a better long term capabilities. I am afraid that this focus on the ‘perfect’ will delay the ‘good’ of value delivered quickly through RPA. This strategy is a recipe for failure in these times of continuously changing demands and waves of market disruption. The best course is a focus on resilience and flexibility to sense and respond quickly to the disruption.


My feeling regarding this view is that we do not have time to only focus on the perfect because, quite frankly, perfection will never be achieved. There will always be the new market or customer demand, the new technology, the new application, the new business process that will require inclusion in your strategy and your operation. The focus on perfection will lead to a business failure to meet the demands of your customer and this failure will cause you to lose customers.


Instead, focus on speed of delivery using bridge technology that will allow you to prove the concept prior to a large investment. This is the space where RPA will shine and you can move your business forward while implementing a more long term solution. The first step then is to define your resilience strategy that identifies your weakness in resilience and then use this information to select and utilize a robust RPA tool.


Tom Brouillette

Contact: tbrouillette@ncspartners.com

@ncspartners


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Tom Brouillette discusses supply chain trends and provides strategic business & technology advice to his followers and companies.

Transition Legacy Framework to Digital Enablement

There has been much talk about ‘getting back to normal’ and ‘new normal’ that I have been thinking quite a bit about because of the continued cycles of lockdowns and now the latest pandemic surge. These disruptions on personal lives are also impacting the business world from a loss of jobs and business closing to the continued work from home requirements. It is past that time now to accept the new reality (I refuse to call it ‘new normal’!), if you haven’t already and take the appropriate steps to live in this new reality. We are already seeing the results of change and we really need to focus now on developing and executing a digital enablement strategy. The pandemic has driven change due to health and safety concerns and these changes themselve are driving the digital transformation. This transformation is beginning to increase in velocity as consumers accept and become accustomed to the new reality and we will never go back.


Any business that directly interacts with the consumer, retail - services, restaurants, for instance, have borne the brunt of the pandemic disruptions to the point of breaking and many have been pushed past that point to failure. Consumers have changed the retail and services markets forever through digital interactions that are redefining the consumer relationship. The changes to the market are not really new, but simply and more accurately, sped up dramatically in a natural progression that has been pushed to the limit by the pandemic. The change here is the ability of consumers to shop, and more importantly, to obtain goods and services without contact, whether eCommerce and delivered to their home or via curb-side pick-up.


Retailers must now take a multi-prong approach to their digital enablement activities; they must focus on a strategy that first defines and then delivers the digital enablement while they also focus on immediate response to the waves of disruption driven in many cases from the COVID-19 transition support requirements. This is difficult for all businesses and especially difficult for the legacy retailer that was already struggling with digital enablement before the pandemic. The change and disruption of the COVID-19 pandemic has pushed digital enablement past the tipping point though and this has now suddenly become a key to survival rather than a progressive transition. Now that this genie is out of the bottle there is no going back. It is now a matter of great urgency to define and implement a digital enablement strategy.


This will be an overwhelming task if the legacy retailers treat this as ‘business as usual’ because there just is no time for them to slow-walk the changes through the organization. If the legacy retailers treat this time of disruption the same as other changes in the market they will be left in the ditch, smouldering. This requires quick actions to move forward without an idea of the end result. At this point we don’t have any idea what the end will look like because the end is being defined and redefined through waves of disruption.


These retailers must implement a strategy of continuous change. They must build a flexible framework that is able to sense and then respond to the disruption. This will require a strategy of digital enablement to be able to sense the disruption and quickly respond. Unfortunately these same legacy retailers are also struggling with labeling applications and cumbersome integration between internal applications and their external partners. The first order of business is to build a flexible framework that will support the velocity of change, while also responding to disruption.


In addition to the above, these legacy retailers do not have the time to figure this out, they must act quickly. Fortunately there are two opportunities for retailers to incorporate in order to survive; consultant organizations to help with the strategy implementation and RPA tools to help bridge the digital enablement between legacy applications and partners. The first step is recognition and the support of senior leadership. This is a huge undertaking and requires a great deal of support from many different areas to succeed and this will require support over time to fail and correct direction. Without full throated support from senior leadership this will only end in failure.


Tom Brouillette

Contact: tbrouillette@ncspartners.com

@ncspartners


Thank you for reading my post on Linkedin in addition, Here at my blog I regularly write about management and technology trends. To read my future posts on LinkedIn click 'Follow'


Tom Brouillette discusses supply chain trends and provides strategic business & technology advice to his followers and companies.

Partner To Develop Digital Enablement Strategy

 

 

The COVID-19 pandemic disruption created an urgency in reacting and redefining the global supply chain in reaction to the consumer market upheaval. The initial pandemic disruption set off waves of related disruptions in such a short period of time that companies and organizations are overwhelmed because they cannot wait until the dust settles to address the next event. We have truly entered into a time of severe VUCA (Volatility, Uncertainty, Complexity and Ambiguity) across the marketplace and the supply chain is in the eye of this storm providing the key capabilities to respond. Now, perhaps more than ever, the response depends on partnerships across the extended supply chain to effectively sense and respond to the disruptions.

We must now assume that the cycles of disruption have reached a point where this time of severe VUCA will be the norm for the foreseeable future. As such, we must develop a strategy and the capabilities that help partner organizations in the extended supply chain to sense the disruption early and respond to the disruption quickly and effectively in a manner that can be leveraged for the response to the next wave of disruption. These demands require expertise in the broad market along with deep specific expertise of partners to first navigate the events and then develop a strategy to utilize the network capabilities to respond. Quick response requirements do not allow for delay hoping the disruption will disappear. We should have learned by now that it requires a response that is based on a market impact and expertise in quick identification of an appropriate response.

This is where technology and specifically a robust digital enablement / transformation strategy comes into play. The velocity of the market coupled with disrupting forces make it almost impossible for humans to sense the disruption in time to respond and limit the impact and prepare for the potential next disruption. Technology that senses the changes in the market and then identifies potential results and impact is critical to the success of a business. Considering the extended supply chain as an example, there is just too many moving parts and participants in the equation for any one partner to hope to identify and implement a response. Success requires developing a partner network to be able to respond to the waves of disruption effectively. Further success requires developing a market partner strategy that informs and enables each individual partner strategy.

This new model requires a strategy that is at once flexible and also embraces extended partnerships to enable the response to disruption in a way that supports the business strategy. Organizations must partner with an expert(s) to help develop this strategy in order to meet the time constraints. You cannot wait for the current VUCA environment to settle and return to business as usual. We need to accept the fact now that business as usual is a VUCA state that requires organizations and partners to ‘walk and chew gum at the same time’. This requires the input and direction from an expert with the vision and the experience and perhaps most importantly the network of partners and contacts that can help in developing this strategy.



Tom Brouillette

Contact: tbrouillette@ncspartners.com

@ncspartners


Thank you for reading my post on Linkedin in addition, Here at my blog I regularly write about management and technology trends. To read my future posts on LinkedIn click 'Follow'


Tom Brouillette discusses supply chain trends and provides strategic business & technology advice to his followers and companies.

Digital Enablement

  

We have reached a tipping point in the market relating to digital enablement and transformation that is fueled by the COVID-19 pandemic and recovery efforts. This has been a long time coming and the market was moving in this direction very slowly prior to the pandemic, in large part I believe because of market infrastructure (especially brick and mortar real estate), retailer culture (waiting for widespread acceptance to work out the bugs) and the consumers using shopping as a physical social exercise engaged in malls. Consumers quickly recognized and embraced the benefits of digital enablement in large part as a result of the necessity to adjust to the pandemic and these same consumers are now dragging retailers and the market to deliver on digital enablement.

The market is currently fragmented in both priority and direction of this enablement while at the same time struggling to react and recover from the pandemic. This disruption has produced a multi-prong disruption that has been extremely difficult for some retailers to react to and their reactions to these disruptions in many ways are spawning new disruptions. These disruptions are driven by the legacy retail market culture that has never really reconciled their practices with the increasing consumer embrace of digital enablement and the resulting market demands. In the past, large retailers have been very hesitant of the ‘bleeding edge’ technology and practices. This ingrained culture of the legacy retail leadership has now impeded their ability to respond effectively and efficiently to the mounting demands of the pandemic recovery, consumer demands and most importantly the resulting disruption and re-making of the retail market.

The change and disruption of the COVID-19 pandemic has pushed digital enablement past the tipping point though and this has now suddenly become a key to survival rather than a progressive transition process. Now that this genie is out of the bottle there is no going back. It is now a matter of great urgency to define and implement a digital enablement strategy. Retailers must now take a multi-prong approach to their digital enablement activities in order to react to the multi-prong market disruptions. They must focus on a strategy that first defines and then delivers the digital enablement while also focusing on immediate responses to the waves of disruption driven in many cases from the COVID-19 transition support requirements. This is difficult for all businesses and especially difficult for the legacy retailer that was already struggling with digital enablement before the pandemic.

There are tools that can be utilized to support the digital enablement and transition strategy that support the necessary transition from legacy retail applications and processes. This is where retailers should focus first and foremost on defining the objectives and deliverables. The next step then requires defining the ‘how’ to deliver the objectives and deliverables. The tools should be incorporated to support the two pronged delivery to enable the transition to the new objectives and requirements while also responding to the continuous disruptions that are buffeting the market.

One tool in particular can and should be utilized to support these transition efforts to digital enablement This tool can also help in responding to the significant disruption and unanticipated impact and reaction still occurring in reaction to the pandemic. I believe a key to digital enablement and disruption response is a robust RPA tool that supports automation of test data and test execution. It is very common to hear testing horror stories regarding costs, labor and schedule requirements in the range of 40% of the implementation. These challenges are a huge impediment to the ability to respond and recover from disruptions and critical business improvements concurrently. RPA can deliver dramatic testing automation improvements in both data generation and test scenario execution that will reduce time and effort to deliver.

RPA is by no means a ‘silver bullet’ solution to your business demands. RPA does however provide a significant tool that can enhance and enable current process improvements and optimization as a first step to your digital enablement strategy. The first step now is to develop your RPA strategy based on demands and opportunities - this will guide you through your second step which is tool implementation. One more important point to take into account, is the benefits of working with an experienced partner to help and guide you in your strategy development and tool selection process to quickly recover costs.

Tom Brouillette

Contact: tbrouillette@ncspartners.com

@ncspartners

Thank you for reading my post on Linkedin in addition, Here at my blog I regularly write about management and technology trends. To read my future posts on LinkedIn click 'Follow'
Tom Brouillette discusses supply chain trends and provides strategic business & technology advice to his followers and companies.

Disruption Without Interuption

  

Disruption Without Interruption should be the mantra for all business strategies because it describes perfectly the objective for all strategies. What we are seeing in the business world is a period of continuous waves of disruption that I believe have been triggered by the COVID-19 recovery demands and requirements. The world is not slowing down and disruption begets disruption which then begets more disruption. While the tipping point may have been the COVID-19 pandemic, the difficulty in responding has been related to the waves of disruption triggered by continually developing events and even disasters. These are not black swan events, instead we seem to have entered into a black swan time period or era.

Based on the above, I believe the business response must focus on a strategy that is informed and guided by a robust Dynamic Risk Sense and Respond program. This strategy and program is based on a solid foundational process of continuous improvement practices that have been proven and reinforced over time that incorporates a robust risk management process. It is important to develop a program to manage and maintain the strategy through quickly changing demands and new disruptions that is both flexible and focused on moving forward. This can only be done by understanding the demands and cause and impact of the current disruption and most importantly the potential for pending future disruption. This Dynamic Risk Sense and Respond program is the foundation that supports your business success through these turbulent times.

Dirruptions and competition are probably two of the key influencers for every business. The interesting thing is that competitors and market competition plays the greater role in business strategy. Looking back over the last nine months shows that disruptions in business, whether supply, demand, or the ability to recover from disruption through an efficient supply chain produced a tremendous impact on business, the market and consumers. It is very clear that a Dynamic Risk Sense and Respond program is an extremely important, if not critical, aspect to any business continuity planning. What's more, it is also very clear that the cycle of disruption is quickening rather than slowing and the importance of these capabilities is critical to the survival of any business in this environment. I also believe that the importance of taking the long term view and developing a plan and process for sensing and then responding to these disruptions is also of the highest importance especially to the long term success of the business.

In order to manage disruption and implement, and most importantly maintain, Dynamic Risk Sense and Respond program and strategy it is important to focus. Focus is required for all strategic initiatives and the challenge is overcoming the day-to-day interruptions, disruptions and challenges that seem to continually interrupt your focus and energy. The challenge it seems is to define a process or incorporate tools that allow you to reduce the need to focus on these interruptions and the perfect tool for this challenge is robotic process automation.

There are many tools, expertise and capabilities available now that can help in developing a robust Dynamic Risk Sense and Respond program to help your business, and the market, to react to disruptions and eliminate or reduce the resulting interruption and impact. Artificial Intelligence and Automation, such as process automation and RPA, are important tools to first sense and then respond to disruption. Other factors in developing a robust program frankly is imagination and consistency in applying imagination. This practice is produced through a commitment and encouragement from leadership that would come from elevating the role to a 'C' level responsibility. I also think audit controls and procedures must be modified to place increased importance on a Dynamic Risk Sense and Respond program to limit the impact of the business.

RPA would allow the monitoring and even automated response to many of the daily interruptions and challenges and this would allow leadership to maintain a greater focus on the higher value objectives of your Dynamic Risk Sense and Respond program. In addition benefits this demonstrates:

1. Commitment to RPA by implementing daily leadership tasks
2. First hand leadership experience demonstrating RPA allows automation of routine tasks to allow focus on value add tasks
3. Roles change to focus on higher value activities rather than job elimination

This ability to automate the routine to allow focus on high value activities may be one of the most significant benefits of RPA from a business and market perspective. I am beginning to think that one of the best and most efficient ways to demonstrate value is to increase the focus on senior leadership implementation. We see hundreds of examples and discussions on the benefit of automating repetitive processes and tasks from an operational and customer support perspective and I suggest adding senior leadership tasks and activities to this list.

The challenge to the program is complacency! Business must fight complacency and the tendency to slowly allow these types of programs to whither.


Tom Brouillette

Contact: tbrouillette@ncspartners.com

@ncspartners


Thank you for reading my post on Linkedin in addition, Here at my blog I regularly write about management and technology trends. To read my future posts on LinkedIn click 'Follow'


Tom Brouillette discusses supply chain trends and provides strategic business & technology advice to his followers and companies.

Risk Scenario Analysis

Risk scenario analysis requires imagination and most importantly collaborative brainstorming in order to identify all risks, even and especially risks that today seem outlandish. As an example, I would have never considered Amazon stopping non-essential product shipments but this is exactly what was enacted as a response to this pandemic. One of the consequences of this action has been a significant impact on small businesses that utilize Amazon for their warehouse and order filling support. This in-tern impacted the success of a great deal of small businesses that were dependant on the Amazon fulfillment services which impacted the livelihood of many employees along with the success of the small business. This then fed into the overall economic impact from the pandemic. This is a great example of the relationships and overall impact of seemingly unrelated decisions on a wide range of people and businesses.

The above example is the key reason why it is so important to perform robust risk scenario analysis. In the example above the impacted businesses now must evaluate the risk of the fulfillment disruption and how they can react to this disruption to support their business. Business must develop a strategic risk management process that views scenarios for any and all risk to the business. Starting in the beginning of this yea the waves of disruption experienced to date have shown that you cannot eliminate a risk because it will never happen. We have gone through a series of disruptions that previously were simply unimaginable as a real risk and so there were no response strategies developed.

The first step is to identify and fully document the risk scenario. This means that the risk scenario must not only identify the potential risk, it must also identify the potential impact to the market and also the business. The definition of the risk is not complete though until you have identified and documented how to sense the risk so that you can execute your planned response. This means that you should identify and document 'outlandish' risks as well as generally accepted risks. The outlandish risk may never materialize however it is important to call out the scenario so that you can take steps to minimize the potential as well as prepare for the realization of the risk.

This is an important point - one of the objectives of the strategic risk analysis and a key outcome are steps that can be taken that will minimize the potential for the risk. This is a concept that needs to become a focus of every risk mitigation strategy because the best way to react to a risk is to eliminate the cause of the risk. Simply defining the risk and the potential impact to the market in general and your business specifically will help to identify how to sense the risk. This exercise of risk identification and early recognition will provide the framework to define the steps necessary to eliminate the risk from occurring.

Risk scenario analysis and mitigation has always been an important aspect of project planning and management. We must institute this same practice now in the supply chain management and business continuity process. As a result of the rate and impact of disruption hitting the market and businesses we must recognize that risk analysis can no longer be viewed as an inward facing exercise. As a result of the disruptions hitting this year we must finally recognize that business continuity must be and outward facing strategy that recognizes early the factors developing of the disruption and takes steps to mitigate and avert major impact.

Tom Brouillette

Contact: tbrouillette@ncspartners.com

@ncspartners

Strategic Risk Management To Counter VUCA

Hope For The Best And Plan For The Worst should be a consistent and shared mantra for all businesses as a means to focus on strategic risk management. The importance of this has increased to the highest level as a result of the COVID-19 pandemic and the activities to both recover and prepare for the next disruption. This requires a significant investment in strategic risk mitigation definition and development and must include partner risk management in the scenario development and risk mitigation strategy. This includes all partners and integrations in the extended supply chain. The weakest link in the supply chain will continuously change depending on the type of disruption and your strategic risk scenarios must be developed to define a response for all scenarios.

One critical activity, or requirement, is implementing a regular risk scenario review process that evaluates the likelihood of scenarios and most importantly, new scenarios. As we have seen from the many disruptions experienced so far this year risk scenarios and potential changes continuously with new risks rising and other risks declining and disappearing. You will never in a million years be able to identify all risks, and the point is that a regular review process provides the means to review so that you can add and remove scenarios as necessary.

The next activity is developing and implementing the appropriate data analytics capabilities that will support the ability to sense the reactions to disruptions and most importantly, the reaction to combinations of disruptions. The risk scenarios must identify the reactions to combinations of disruptions and then you must have a means to measure the responses. This is where data analytics comes into play, along with a healthy helping of imagination. Different disruptions and combinations of disruptions will cause different reactions in the supply chain and these reactions must be identified quickly in order to determine the appropriate response. The risk scenario identification and evaluation is important but it is based on assumptions and personal viewpoints of the team that developed the scenarios. Data analytics brings the facts to the table to help to determine the appropriate response.

The glue that connects these processes and activities is imagination. Risk scenarios require imagination to create, risk response exercises require imagination to develop, data analytics requires imagination to develop the queries and identify the appropriate data and source to identify the reaction to the disruption and then to validate the effectiveness of the response. As you can imagine, this is not a ‘once-and-done’ exercise. This requires continuous review and evaluation in order to grow and evolve with the market and the supply chain. Each disruption and reaction to the disruption creates a new reality stream that changes scenarios and potential for disruption and it is important to continuously evaluate and develop new scenarios.

Data analytics is a very nebulous practice that requires continuous experimentation and evaluation to validate assumptions. The data analytics initially produces the outcome reaction to disruption and combinations. This is only the start, however, because after identification of the outcome you must then try to trace back the results through the responses and combination of responses if you want to tie them back to a particular disruption. I’m not sure that it is critical to tie everything back to a specific disruption though. The point of this whole exercise is to identify a reaction to mitigate the specific business disruption that has occurred and this should be the initial focus. After the mitigation exercise you will need to go back and evaluate the actions that resulted in the disruption on another day.

Tom Brouillette

Contact: tbrouillette@ncspartners.com

@ncspartners

COVID-19 Crashed Into The Economy

Covid-19 crashed into the economy causing supply and demand side disruption that continues to ripple through the supply chain impacting planning and forecasting in addition to transportation, storage and manufacturing disruption. This disruption requires robust data analytics to sense and respond to the dynamic changes that ripple through the economy. The challenge and first priority is developing the capabilities based on a robust data analytics business intelligence model to sense and respond early to risk so that the impact of the continuously changing disruption. This challenge requires a great deal of imagination and focus in order to develop the tools and framework that is both robust and flexible to respond to the disruption.

This is not a single event, it is a significant event in a series of events that will continue to impact the economy and as a result the extended supply chain into the future. This fundamentally changes your business continuity planning requirements to include a larger number of scenarios and combinations of scenarios in order to manage the risk. In addition to the expansion of risk scenarios this also requires more frequent reviews and most importantly - data analytics to sense the disruption early in the life cycle. This combination of additional and improved strategic business risk scenario evaluation and improved analytics to sense the disruption are key to successful response to limit the impact of the disruption.

We have reached the point now in the global market where these capabilities are critical not to the success of your organization but they are now a critical factor in the survival of your organization! The current situation is a perfect example of how risk is driven by multiple events to disrupt. In the last year we have experienced severe climate related events such as wildfires, hurricanes and tornadoes that impact the market and product demands Then add to this the US / China trade war that initiated the manufacturing shift from China to other Asia Pacific countries. Then before the trade war settled the pandemic crashed into the market first impacting manufacturing and flowing through a shut down of the world economy.

All of these factors come together for a 500 year disruption that must be resolved. We must reset our scope and risk management though to plan for the 500 year disruption continuously. In a global market there are so many factors that influence change and disruption along with the impact of the disruption. These factors change with the season and the relationship and impact of the combination of factors require a focused risk scenario strategy in order to sense the factor early so that the response can be identified to limit the disruption.

It is no longer acceptable to react to the disruption after the fact. The disruptions are coming too quickly and more importantly the disruption builds on previous factors and disruption to create new impacts. Your organization will not be able to survive unless you implement a risk management sense and response strategy that is frequently reviewed and revised for new scenarios and responses. The good news is that the tools are available now to support this initiative and only require the focus and priority to develop and monitor the strategy.

COVID-19 Requires Optionized Supply Chain

I have been discussing supply chain disruption for quite a while now as it relates to consumer demands and natural events such as destructive weather. The COVID-19 pandemic now adds a new and even more real, and more serious, disruption that must be addressed. The key underlying challenge is how to address disruption and especially extreme disruption. We have already entered into a time of extreme discontinuous disruption that demands and absolutely requires immediate response to survive and support the demands created from the disruption. We can no longer ignore the disruption cycle and as a result must focus now on an optionized supply chain rather than an optimized supply chain so the response can be supported through pre-planned actions. The critical requirement is to continue the supply chain and minimize disruption through a robust risk sense and respond strategy. This risk management strategy must become a critical aspect to the supply chain management overarching strategic plan.

The global supply chain is a fact of life now and as a result of the length of time this supply chain has been developing, it is now the norm. Frankly, it would require an unreasonable length of time and money to change, and most importantly, the cost would never be recovered. We must look past the angry demands to move manufacturing ‘back to the US’ and instead take a more reasonable approach to accept and plan for disruption and then develop options and practices to quickly and efficiently adjust to disruption. This means adding an enhanced risk analysis and risk management strategy to the supply chain planning and forecasting tool kit. We must now focus on disruption scenario planning and response option development to ensure that we are able to minimize the impact to the supply chain.

The good news is that we already have practices and tools available to enable disruption options risk analysis and determination. The current state of supply chain software with the addition of big data analytics provides the framework for a robust early risk warning capability to allow implementation of options to address the disruption. We must develop the strategy now utilizing the framework of available tools to support the process. The result of this initiative will be a framework of process and procedures that will allow the extended supply chain partners to sense and respond to disruption based on scenarios and options that have been identified previously.

The challenge with implementing the disruption sense and respond risk analysis framework is not the supply chain management tools. These tools are quite robust and provide the capabilities to adjust quickly and efficiently to the disruptions in a truly efficient manner. These tools over the years have progressed to a state of flexibility in configuration capabilities that is truly quite amazing. The flexibility and configurability has been built into the software to allow a super user to support standard and general maintenance requirements without support of an engineer or software developer. These configuration capabilities I believe are quite capable to support the demands of the ‘optionized’ supply chain to support the risk sense and response framework.

The challenge now from a technology perspective is related to sensing and identification of the risk in a timeframe that allows the supply chain to identify and then implement the appropriate configuration options to manage and flourish during and (most importantly) after, the disruption event. Fortunately, big data and analytics has reached a state that is beginning to support the requirements to sense and determine how to respond to the disruption based on a predetermined business continuity plan. The analytics requires an efficient tool in order to bring the data together from disparate sources into a pool where the analytics can be utilized. This is one of the new continuing supply chain management requirements.

This leads to the next challenge which is to define a robust and flexible business continuity plan that provides suggestions for predetermined options based on the type of disruption. This business continuity plan takes on new meaning and also new use in the supply chain. This plan must be extended first to identify any type of business and supply chain disruption that may occur and then identify the potential for the disruption (risk) along with configuration options to react and adjust to the disruption. In my experience, the business continuity plan has been reviewed at a minimum and normally on an annual basis. The review process must be more rigorous and reviewed more frequently in order to provide the flexibility and direction required to address disruption.

I suggest a two-pronged focus on the review of the business continuity plan to extend the types of disruption and the potential impact along with identification and implementation of a data analytics tool that supports efficient and flexible identification of disruption early. It is most important to identify the potential for disruption so that you can react early and adjust to address the disruption prior to serious supply chain impact. The key focus must be the big data analytics in order to sense and respond to the disruption. Disruption is a way of life now, it is critical to manage the disruption in a way that limits the supply chain disruption.

Tom Brouillette

Contact: tbrouillette@ncspartners.com



@ncspartners