I can’t help but wonder how unnatural and unnerving it must seem to those legacy supply chain software vendors to hear today’s manufacturers talk of the return to human hands involvement in establishing the actions of a given day. Indeed, the optimization vendors saw significant success when their models could approximate the ‘known’ business parameters of a supply chain, but as Randy points out, today is filled with the ‘unknown’. Executives and Supply Chain practitioners are recognizing that approximating the ‘unknown’ elements of a supply chain as a means to determine what to do next is a fool’s errand. Don’t get me wrong; I’m not suggesting that those legacy solutions have completely lost their value, but rather, their value is limited when a supply chain has matured and grown to become a complex network of inter-enterprise connections. As supply chain networks continue to mature and grow, so does the need for a competency in human and system collaboration.

The section on ‘Dealing with Reality…” does a great job of describing the undeniable trends driving the need for a new supply chain planning paradigm. Ask any supply chain executive the following questions, and the need becomes self-evident.

1. Is your supply-chain more or less complex than it was in the 90’s?
2. Are your product life-cycles shorter than they were in the 90’s?
3. Are your customers demanding shorter lead-times, and increased order flexibility then they were in the 90’s?
4. Has it becoming more difficult to maintain customer loyalty than it was in the 90’s?

Unanimously, I hear that supply-chains are more complex, products have a much shorter shelf life, and customers are far more knowledgeable about competitive products, and therefore more demanding of brand owners. Finally, the two questions that lead me to believe that the urgent needs of manufacturers today are dramatically shifting:

1. Do you believe that the next 10 years will relieve any of the previously mentioned trends?
2. Which process do you believe will work to regain control over your company’s performance;
   a. Improve Planning
   b. Improve response to plan variation

The best planning solutions on the planet cannot replace human judgment. As Randy describes in his conclusion, the need for human involvement is making a strong come-back, where people collaborate in teams formed to established rapid and appropriate course corrections when unexpected events occur in the supply-chain. The fact that planning systems are based on fixed assumptive parameters put them at a disadvantage. Better/faster planning can never take into account the assumptions ‘known’ by people at the very moment a course correction is required. Only when people can ‘know sooner’ about events that pose potential future state harm to their business, when people can ‘know’ who is affected by those events, and when otherwise people who are strangers to one another can rapidly form teams to collaborate on an appropriate course correction, will the most optimal and appropriate actions take place.

It is strangely satisfying in the 21st century to watch “people” once again regaining control over what was recently under the strict management of “machines”.

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Tags: Supply chain, Supply chain planning
Posted in Supply chain management
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