The LogiPharma conference held in spring every year is the premier event focused on all things supply chain and distribution in the pharmaceutical industry. This year it was in Basel. The first thing I have learned over the past winter has been the impact of the Polar vortex and the fact that despite Basel being considerably further north than Toronto, spring can arrive a lot earlier, thanks also to the North Atlantic Drift. But I am getting distracted.
Lesson 1: Control Towers are becoming mainstream
In the case of LogiPharma they had a really interesting survey about the state of pharmaceutical supply chain capabilities and needs. A core theme of end-to-end planning and visibility that jumped out of the preconference survey continued throughout the conference. As per the diagram extracted from the survey, the term used by many people to encapsulate this idea of end-to-end planning and visibility is ‘control tower’.
What is interesting is how this theme is so consistent with Gartner’s most recent Magic Quadrant for Supply Chain Planning Systems of Record. In the report Gartner defines a supply chain planning (SCP) System of Record (SOR) as:
An SCP SOR is a planning platform that enables a company to create, manage, link, align, collaborate and share its planning data across a supply chain — from demand plan creation through the supply-side response, and from detailed operational planning through tactical-level planning. [i]
However, where a ‘control tower’ comes into play is when Gartner goes on to state that:
Increasingly the deployment of a SCP SOR will have to be in the context of multi-enterprise supply chains and the convergence of planning and execution to facilitate more responsive, agile planning – especially in the short-term horizon – across extended value chains. [ii]
In other words we are seeing the two ends of the supply chain – demand and supply – extend beyond the traditional span of control of the pharmaceutical manufacturers. On the demand side this is due to a number of factors, but the biggest drivers are expansion into global markets on the demand side and the relative explosion of outsourcing on the supply side. As the supply chain extends beyond the boundaries of the pharmaceutical manufacturers they have less and less visibility because typically they rely on their ERP solution, but as Jim Cafone, Vice President, Supply Network Services at Pfizer Pharmaceuticals said a few years ago at the Gartner Supply Chain Leaders conference:
ERP is fine if you only want to talk to yourself. But who can afford to do that in today’s world?
While Pfizer have deployed a logistics control tower through our partner GT Nexus, they have not yet matured to a Supply Chain Planning SOR as described by Gartner. Of course every increment in capability needs to be celebrated, and what Pfizer has done is a big leap forward, there is still some ways to go for them to be able to plan across multiple tiers, not just execute. Which brings me to the second thing I learned at LogiPharma…
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