The future of supply chain management is AI and Data

This is an excerpt of the original article. It was written for the March-April 2021 edition of Supply Chain Management Review. The full article is available to current subscribers.

March-April 2021

Last night, my wife and I shared a socially distanced bonfire with a few friends. One was a retired physician who is spearheading the vaccination effort in the small New Hampshire city where I live. New Hampshire has had its challenges getting needles into arms like everywhere else, but it seems as if we’re breaking through the log jam. For example, between week 1 and week 3, they’ve tripled the number of people they can vaccinate in a day, and they’ve expanded from five days a week to seven days a week. At least for now, there has not been a shortage of vaccines. I know there is a long way to go, but you can feel it picking up speed. Call me…

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Because enterprises are like organisms in an economic ecosystem, the principles that enable a healthy biological ecosystem are, from a physical, chemical and informational perspective, identical to those that enable a healthy business ecosystem and that ensure the survival of members of that business ecosystem. Value is created by solving problems through the application of information and creativity. By speeding the information flows and reducing inefficiencies, we are equipping our part of the bigger picture to operate effectively, adapt quickly and evolve to meet competitive threats and exploit opportunities in the environment.

Supply chains are a crucial and complex part of the information flowing in this ecosystem. They are an intricately structured and variable system that is highly sensitive, with many possible outcomes based on even minor changes in the initial conditions or components. Supply chains feature a large collection of interacting components that are difficult to understand or examine due to their design and operations. And they represent a system in process, changing and developing over time.

It’s critical to think holistically about the information ecosystem as you prepare the digital representation of various stages of product design and development. Even a product designed in isolation from other systems and groups—whether in a specialized department or in a separate contracting organization—is still part of an information ecosystem. Information that may be inconsequential to the group that is creating the product, such as an obscure material specification that has no immediate value, will likely have value either downstream (perhaps to a distributor or engineering group) or upstream (perhaps to a procurement manager or supply chain manager).

Too often, these unseen dependencies and information relationships are neglected, and the impact of this neglect can be significant. If a piece of data that will be needed when assembling or distributing a future product is not captured, is lost or is incorrectly represented, the cost of remediation is orders of magnitude larger than that of addressing the data need at the source.

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