Executive Briefings

Grok This: Most Companies Not Meeting Goal of an Integrated End-to-End Supply Chain

There are five primary reasons why the goal of an end-to-end value chain remains a mess:

Turn the supply chain outside-in.  Processes have been defined as inside-out, not outside-in.  The focus has been on RESPONSE as opposed to Sensing.  As a result, companies cannot connect.  The end-to-end value network cannot be all push from inside the company to outside the company. The supply chain needs clear definitions of push/pull boundaries.  This concept is still not well understood.

Traditional applications do not give us the right adaptors. Traditional definitions of enterprise applications (ERP, BI, CRP, APS, SRM) do not give us natural connectors for the extended value chain.  While over 85 percent of consumer products companies have mature applications in these traditional enterprise applications areas, sadly the primary method of communication is email.

A need for horizontal processes.  A focus on vertical process excellence.  The integrated end-to-end value network is dependent on mature horizontal processes that span functions.  Key processes include not only order to cash and procure to pay, but also revenue management, supplier development, sales and operations planning, product launch, demand sensing and shaping, and supply visibility.

Relationships matter. Today's applications focus on transactional efficiency not relationships.  To achieve the successful end-to-end value network, relationships matter.

Visibility is not mature enough.  The term visibility, while widely accepted, has a myriad of meanings, all of which are not sufficient.  Supply chain technology users still want to up the ante on visibility, but shrink at the price tag.

Source: Supply Chain Shaman

There are five primary reasons why the goal of an end-to-end value chain remains a mess:

Turn the supply chain outside-in.  Processes have been defined as inside-out, not outside-in.  The focus has been on RESPONSE as opposed to Sensing.  As a result, companies cannot connect.  The end-to-end value network cannot be all push from inside the company to outside the company. The supply chain needs clear definitions of push/pull boundaries.  This concept is still not well understood.

Traditional applications do not give us the right adaptors. Traditional definitions of enterprise applications (ERP, BI, CRP, APS, SRM) do not give us natural connectors for the extended value chain.  While over 85 percent of consumer products companies have mature applications in these traditional enterprise applications areas, sadly the primary method of communication is email.

A need for horizontal processes.  A focus on vertical process excellence.  The integrated end-to-end value network is dependent on mature horizontal processes that span functions.  Key processes include not only order to cash and procure to pay, but also revenue management, supplier development, sales and operations planning, product launch, demand sensing and shaping, and supply visibility.

Relationships matter. Today's applications focus on transactional efficiency not relationships.  To achieve the successful end-to-end value network, relationships matter.

Visibility is not mature enough.  The term visibility, while widely accepted, has a myriad of meanings, all of which are not sufficient.  Supply chain technology users still want to up the ante on visibility, but shrink at the price tag.

Source: Supply Chain Shaman