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2018
by Alexa Cheater

Artificial Intelligence in Supply Chain Management – KinaxisFaster, smarter, more profitable supply chain decisions

Transitioning from hype to reality, artificial intelligence (AI) is gaining momentum across industries thanks to an explosion in computing power and storage, the emergence of IoT (Internet of Things) and big data, and algorithmic advances. While there have been numerous examples of how AI can boost profits in supply chain execution—most notably in the form of autonomous vehicles and smart robotics—the benefits related to supply chain planning have largely been ignored.

 

But that’s starting to change as future-focused executives see the potential to improve profitability and productivity by making faster, smarter supply chain planning decisions. The first step in achieving those benefits is understanding AI and the other technologies associated with it, and where they can help improve your supply chain planning initiatives.

 

Emerging technologies and how they relate to supply chain planning

People often use AI as a catch-all term for any kind of technology that involves smart machines. And while many of those fields do fall under the AI umbrella, it’s still important to know some of the key differences between the terminology. Here are three simple definitions of AI and related technologies, plus how they apply to supply chain planning.

 

1. Artificial intelligence

The ability of a machine to perform human-like functions such as perceiving, reasoning, learning, interacting with the environment, problem solving and exercising creativity to form plans, make decisions and achieve goals.

 

Use in supply chain planning:

 

  • Amplify the value of your existing processes and people with machine-assisted planning, which can help you bridge the knowledge gap between experienced and inexperienced planners, and gain real-time recommendations based on historical and current data analysis.
  • Improve your supply chain visibility and risk insight by using AI to track and predict possible supply chain disruptions based on inputs and correlations across multiple data sources, including weather forecasts, news and even social media.

2. Machine learning

A subset of AI, machine learning is a method of data analysis where machines use algorithms to detect patterns, learn to make predictions and make recommendations by finding hidden insights in your data without being explicitly programmed where to look.

 

Use in supply chain planning:

 

  • Unlock new sources of revenue savings by implementing a self-healing supply chain that can continuously observe, monitor and correct out-of-tolerance lead times for all related products based on historical data and slope.
  • Increase customer service levels with more accurate demand behavior for new products by using algorithms based on early-sell signals to optimize inventory levels and replenishment plans.

3. Deep learning

A subset of machine learning, deep learning leverages neural networks to understand vast amounts of unstructured or unlabeled data in either a supervised, semi-supervised or unsupervised way, drawing conclusions, learning if those conclusions are correct and then applying that learning to new data sets.

 

Use in supply chain planning:

 

  • Save time and money with an always-on automated planning agent that automatically handles low impact exceptions as they arise, delivers detailed reports on its observations and the corrective actions it took, and send alerts to the right people when larger issues arise.

Companies are making big strides in developing and deploying real, practical applications of AI in supply chain management and planning. Before jumping on the bandwagon, ensure you’re not getting caught up in the hype and truly understand what you’re signing on for, because while AI is helping pioneer a new future, it still has its limitations.

 

How are you exploring AI in supply chain planning? Let us know in the comments section.

 

The post An executive’s guide to AI in supply chain management appeared first on The 21st Century Supply Chain.

 

Avaya digital transformation - Kinaxis

 

Originally posted by Alexa Cheater at https://blog.kinaxis.com/2018/03/an-executives-guide-to-ai-in-supply-chain-management/

by Bill DuBois

Intelligence is the ability to adapt to changeOn March 14, 2018, the world lost an unbelievable talent in Stephen Hawking. Tributes continue to pour in around the globe for a man who gave so much to science, all while fighting motor neuron disease since the age of 21. As astronaut Chris Hadfield commented on Twitter, “Genius is so fine and rare.”

 

Fortunately, for us, Hawking’s genius will live forever as his words continue to inspire generations. He had many great quotes that motivate anyone regardless of profession. Like many others, I try my best to apply Hawking’s wisdom to my work. If you’re reading this, that work is likely improving supply chain planning and our lives in general. The two often intertwine, which makes the wisdom even more valuable.

 

With that in mind, I thought I’d pass along some of my favorite Stephen Hawking quotes and tie them to supply chain planning. Here are my top five favorite quotes from the brilliant mind of Stephen Hawking:

 

1. “Quiet people have the loudest minds.”

How often have you been in a meeting or on an implementation project with one silent person? If this quote has taught me anything, it’s that everyone has a voice. In supply chain planning, that’s especially true for the people doing the planning. The most successful projects I’ve witnessed are those where everyone has a voice. Sometimes people just want to get on with planning, but when they take the time to open up about current challenges, solutions start to become more obvious.

 

2. “Keeping an active mind has been vital to my survival, as has been maintaining a sense of humor.”

From a supply chain perspective, when I hear the word survival, my first thoughts are about managing unexpected change. In particular, change caused by natural disasters such as the tsunamis, hurricanes and earthquakes that have occurred in recent years. Ultimately, it’s the active minds of the supply chain communities who look for the solutions to these problems, as well as continuing education that leads to significant process improvements. It’s not uncommon for companies to invest in centers of excellence to learn and share best practices. I admire how Hawking could maintain a sense of humor in spite of his disability. You can’t deny that he loved what he did because his work made him so happy. He didn’t have time to complain, which brings me to the next quote.

 

3. “It’s a waste of time to be angry about my disability. One has to get on with life, and I haven’t done badly. People won’t have time for you if you are always angry or complaining.”

Time is the most precious thing we have. It’s so valuable you can’t even put a price tag on it. You’ll give it freely to people you love and find interesting. However, start wasting someone’s time and see how fast they disengage. When solving supply chain planning problems, complaints don’t help. It would be easy to complain about those unexpected changes and make excuses for expedites, excess inventories, and missed deliveries. Who could blame you after facing supply chain challenges, such as natural disasters?

 

True supply chain leaders replace excuses with lessons learned. They don’t get angry, they get motivated to do better the next time and improve supply chain planning so that managing unexpected change becomes as easy as a pit crew changing a tire for a Formula One car. People are interested in solutions, and motivation— unlike anger and complaints—is contagious.

 

4. “Intelligence is the ability to adapt to change.”

Supply chain planners have become masters of change. Explore any supply chain blog for a list of challenges planners face and the extent that change in the supply chain has intensified. Decades ago, successful supply chain leaders realized that they would have to get good at change. Maybe it’s supply chain intelligence, wisdom or—as mentioned in the second quote—survival. Whatever you call it, adapting to change is smart and can be profitable.

 

5. “I have no idea what my IQ is. People who boast about their IQ are losers.”

It’s difficult to define a human being by a number. Education, experience, hardship, relationships— among so many other things—make a person who they are. It’s that mix that makes a person a valuable team member, not just an IQ number. When working with other companies on their supply chain challenges, not once did someone ask me my IQ. However, they did want to hear about other companies and the experiences our deployment teams brought to the table. If it’s good enough for Stephen Hawking not to know his IQ, it’s good enough for me.

 

Do you have other favorite Stephen Hawking quotes? Let us know in the comments.

 

The post A brilliant mind: 5 Stephen Hawking quotes appeared first on The 21st Century Supply Chain.

 

Avaya digital transformation - Kinaxis

 

Originally posted by Bill DuBois at https://blog.kinaxis.com/2018/03/brilliant-mind-5-stephen-hawking-quotes/

by Ilyas Kucukcay

Space: The final logistics and supply chain management frontierRecent advancements in the space launch market may indicate an increased need for logistics and supply chain management in outer space operations. Humankind’s ongoing curiosity about space has countries competing to prove they have not only the technology, but also the resources and collective knowledge to go beyond our imagination.

 

Accessing what’s beyond our globe has become an accepted source of socio-political promotion. It’s an indication of a society that can use advanced supply chain technology to achieve the best, and to find and harvest the undiscovered.

 

The space industry was born from military-related needs during and after World War II, and evolved into a commercially beneficial industry for governments and accredited companies all around the world. Today’s government-based space agencies collaborate to advance the science, technology and services needed to support their programs. In parallel, privately held and publicly traded companies like SpaceX, Arianespace, Orbital Sciences and Sierra Nevada Corporation boost the number of manufacturing options for space-related programs while contributing to the innovation of space and rocket technology.

 

SpaceX recently launched the revolutionary Falcon Heavy rocket, an internally funded program that’s the most powerful operational rocket in history. The achievement proves to the world that components can be successfully re-used to launch and lift relatively bigger supplies into outer space, underscoring the importance of streamlining multi-purpose inbound and outbound delivery operations in the near future.

 

Improvements and innovations like Falcon Heavy are also a clear indication that logistics and supply chain management will become that much more important for the space industry in the following ways:

 

Supply and Logistics of Materials

 

This is the material that will be used for routine activities and operations, from the supply of food to the staff who’ll operate the missions to the re-usable technology that will allow humans to travel and work in space. Also included are critical materials such as fuel needed to support renewable energy sources within the spacecraft, oxygen to sustain life and spare parts that may be needed during the mission.

 

Space Logistics and Supply Chain

 

Space-related operations are projected to form humankind’s largest supply chain network. This network will help deliver humans and technology to outer space with the lowest possible operational cost and risk. In the long run, the supply chain will help make space exploration sustainable, giving us the ability to harvest resources from other planets and deliver them to earth to provide new sources of raw material and enable various industries. Managing the supply chain and logistics in space will not be easy and is still speculative on many levels.

 

However, many organizations have already started working on a variety of space-earth supply chain technology concepts. For example, MIT’s Interplanetary Supply Chain Management and Logistics Architectures (IPSCM&LA) project is funded to “develop an integrated capability for guiding the development of the interplanetary supply chain that will be required to enable sustainable space exploration of the Earth-Moon-Mars system and beyond.”

 

Space exploration is no longer a competition between superpowers. In addition to NASA and Roscosmos, other players like China Aerospace Industry Corporation (CASC), Indian Space Research Organisation (ISRO) and European Space Agency (ESA) are planning to expand their space operations to increase efficiency, while independent companies like SpaceX and Arianespace provide cost-efficient launch and delivery programs with re-usable technologies.

 

The field of logistics and supply chain management is key to sustainable space exploration. Governments and private and public organizations boost the level of competition, providing new sources of technology, scientific research and human capital, and create new supply chains and logistics to efficiently deliver the material for these initiatives to succeed.

 

The future holds exciting and innovative discoveries in space exploration. While it’s exciting to witness early improvements in the industry, a diverse network of players will add value to the mix and push innovations in aerospace supply chain management and supply chain technology even further.

 

I would love to hear your ideas about how companies like SpaceX and Arianespace will change the nature of supply chain management and logistics. Looking forward to your comments!

 

The post Space: The final logistics and supply chain management frontier appeared first on The 21st Century Supply Chain.

 

Avaya digital transformation - Kinaxis

 

Originally posted by Ilyas Kucukcay at https://blog.kinaxis.com/2018/03/space-final-logistics-supply-chain-management-frontier/

by Alexa Cheater

Digital Supply Chain Strategy: Challenges and Next Steps – KinaxisGoing digital has become top of mind for most supply chain leaders these days. But finding success through digital transformation is still an elusive venture. According to recent research by the Korn Ferry Institute, all 100 senior supply chain executives the firm surveyed said digital supply chains have the potential to revolutionize businesses. Seventy-four percent admitted they still have a long way to go before that becomes reality. So, what’s standing in their way (and possibly yours as well)?

 

Lack of a clear digital supply chain strategy

Nearly half of respondents noted that while they have started on digitization, their strategy only considers the impact on the business, not how to implement digital in the supply chain. This could be due in part to lack of engagement at the executive and board level.

 

“The missing capability is understanding of supply chain at the board level. Supply chain is seen as cost down, whereas we should see it as a new revenue model generator. Everything comes back to the leadership challenge; why are we failing to get the right leadership at the top?” called out Janet Godsell, University of Warwick’s professor of operations and supply chain strategy at Warwick Manufacturing Group, in the report.

 

“UK boards are dominated by commercial and financial backgrounds, and even if you change the gender and ethnic mix, this does not overcome every angle of the lack of diversity. fficers are a relatively new addition to the executive board, but are not usually on the main board at the top table.”

 

But a lack of a clear digital strategy isn’t the only barrier to success.

 

Limited availability of digital talent

Just over half of survey participants stated they have a formal leader in place for their supply chain digitization movement, with many feeling top digital talent is hard to find and attract. As Korn Ferry points out, Generation Y gets bored easily, and keeping them engaged at your company adds to the challenge.

 

The consensus from the survey results is that hiring talent with the necessary skills is the preferred way to build and develop digital capabilities in the supply chain, with internal training coming in second. However, the survey also notes a lack of financial commitment to develop those skills internally, with two out of three executives allocating less than 10 percent of their learning and development budget to digitization.

 

Those with clear digital leaders in place and a plan to attract new talent or develop existing resources are ahead of the pack. A staggering number—three out of four respondents—said they haven’t formally assessed the digitization readiness of their existing supply chain employees, and roughly half have no plans to do so.

 

Next steps toward digital supply chain success

Supply chains have transformed over the past decade, moving front and center into a strategic role within organizations. But that lack of representation at the executive and board levels is preventing the supply chain’s rise to digital transformation.

 

Another stumbling block is the mentality that going digital means just slapping digital capabilities onto traditional supply chains, which results in hybrid models and added complexity.

 

As Korn Ferry puts it, “Even companies that embrace the value of an effective and sufficient supply chain often stick with incremental changes rather than choosing a high-risk/high-reward transformation towards a truly integrated, re-invented supply chain whose DNA is fundamentally digital.”

 

Is your organization’s supply chain truly ready to go digital? Let us know in the comments area below.

 

The post What’s keeping you from realizing digital supply chain success? appeared first on The 21st Century Supply Chain.

 

Avaya digital transformation - Kinaxis

 

Originally posted by Alexa Cheater at https://blog.kinaxis.com/2018/03/whats-keeping-realizing-digital-supply-chain-success/

by Alexa Cheater

Avaya: A supply chain management case study

Driving Avaya's digital transformationTrust in the transformation. That’s what high-tech giant Avaya had to do when the company decided to radically change up how it manages its supply chain. Going from a self-proclaimed worst-in-class supply chain to one of the best in the business was no easy feat, but the rewards were well worth the effort.

 

“In the beginning, it was tough,” admits Benji Green, Avaya’s Senior Director, Integrated Supply Chain Planning & Operations, in a recent article published by Supply Chain Digital. “12-hour days, hair on fire supply constraints, excess inventory, completely manual processes, imbalanced supplier terms and conditions, poor cash to cash. You name it, it was bad. It was hard to imagine becoming best-in-class at the time.”

 

Tracking success: Metrics matter

Now Avaya is leading the way, exceeding industry benchmarks in 11 key metrics. The company has reduced supply chain expense by 50% and decreased cash tied up in net inventory by 94%. At the same time, it’s seen a 224% improvement in inventory turns and pushed on-time shipments to a record best 97% on-time.

 

How did Avaya do it? The answer is time, perseverance and a clear vision to exceed employee and customer expectations while fueling profitable growth. The company also made substantial investments to attract, train and retain top talent, while building a corporate culture that engages those willing to contribute to Avaya’s success.

 

Avaya also measures and reports on more than 100 metrics, each aligned with the company’s four pillars: customer satisfaction, employee satisfaction, cash-to-cash and supply chain expense. Rigorous tracking of these metrics helps Avaya feel confident it’s on track to realize success.

 

Technology-driven change drives better outcomes

Changing up its supply chain management technology was also a critical piece to Avaya’s success. The company migrated its business processes onto a single platform—Kinaxis® RapidResponse®. It now uses the cloud-based solution for:

 

  • Supplier communication
  • Supply planning
  • Demand planning
  • Inventory planning
  • Inbound and outbound logistics planning
  • Procurement spend analysis
  • POS analytics

“We do everything from daily supply assurance and revenue risk to strategic product transitions on RapidResponse,” says Green. “Central to globalization, RapidResponse allowed for extensive automation of non-value added work, standardization of processes across multiple MRP instances, products portfolios, and regional variations. The tool, properly managed, has globalized Avaya’s planning and operations processes and organization and helped deliver dramatic improvements and sustainable performance.”

 

Find out more about Avaya’s incredible supply chain transformation in Driving Digital Transformation from Supply Chain Digital.

 

Want to dive even deeper into Avaya’s supply chain transformation? Read Aberdeen Group’s in-depth case study.

 

The post What does it take to build a best-in-class supply chain? appeared first on The 21st Century Supply Chain.

 

Avaya digital transformation - Kinaxis

 

Originally posted by Alexa Cheater at https://blog.kinaxis.com/2018/03/take-build-best-class-supply-chain/

by Dr. Madhav Durbha

Why IT matters to business success and effective supply chain managementThe coffee shop was buzzing.

I was meeting my longtime friend Gagan, and we managed to find a reasonably quiet corner to settle into for what I anticipated to be a long conversation. He and I went to school together and started our supply chain careers at nearly the same time. I joined a supply chain software company while Gagan joined a large global manufacturer and quickly grew through the ranks to be the vice president of supply chain IT in his company.

 

Throughout our careers, we continued to meet up whenever our travels crossed paths. Gagan is typically an upbeat and optimistic person, but on this day, something was clearly weighing him down. As it turned out, it was about his job, his sense of ownership, digital transformation and his company’s supply chain. Gagan was reporting to the CIO, and the board of directors recently mandated the company embark on a digital transformation journey. As part of the initiative, Gagan’s CEO brought in a new chief digital officer (CDO) as a peer to the CIO. And that’s when Gagan’s troubles started.

 

Two sheriffs in town

Almost immediately, the new CDO declared responsibility for all new technology initiatives in the company. Quite naturally, the CIO started digging in his heels, increasing tensions between the two executives. Their differences were eventually settled by the CEO, who decided legacy assets and most back-office systems should be the domain of the CIO. Any newer digital technology portfolios would be cloud-based and mobile, and where appropriate, open source. These would belong to the CDO.

 

The result? A disgruntled team

Gagan’s team of young analysts continued to support legacy supply chain applications from an established vendor. However, his team grew disgruntled as the CDO took on newer, more interesting projects based on everything from the Internet of things (IoT), to data science, machine learning, advanced analytics and blockchain, to mention a few. Understandably, Gagan’s team started to feel like they were being left behind.

 

Keeping the lights on

“Agility and flexibility” became the company mantra, leaving Gagan with the overwhelming feeling that his team could not possibly deliver on the promise. After all, the supply chain planning applications his team supported were built on legacy batch-oriented architecture, significantly limiting his team’s ability to mitigate the challenges the company faced, all largely due to the following systemic limitations:

 

  • Data islands: As the company experienced inorganic growth, diverse technologies were constantly added to the mix, leaving data siloed and blocking end-to-end visibility.
  • Planning in silos, node by node: Finished-goods distribution planning, manufacturing planning and purchase planning were all happening in silos, further adding to the company’s woes.
  • Latency in decision making: While the company’s supply chain planning system ran in batch mode, business ran in real time. When a production line went down or supplies did not arrive when expected, planners resorted to offline excel spreadsheets, resulting in delays that could last hours before contingency plans could be formulated and put in place.
  • IT overload: Because the system was so rigid, enhancements required heavy IT involvement. Predictably, support tickets started piling up, and Gagan’s team was taking heat from the users.

“My team could deliver anything but ‘agility and flexibility,’” said Gagan. “While the CDO got funding for new technologies, funds from our organization were siphoned off to support them. We were accountable for ‘agility and flexibility’ but didn’t have the budget to back it up. Not once did the CDO update us on the projects his team was working on, nor did he ask what we were wrestling with. My boss, the CIO, is completely sidelined. It’s as if my team is being led on horseback into a 21st century battle field with nothing but bows and arrows. We’re getting slaughtered. In fact, my lead architect just left the company.”

 

I took a sip of my now lukewarm coffee, and pushed the cup aside. Gagan had gained weight. His eyes were sleepless and his face was showing age beyond his years. I worried for him and wondered aloud what he was going to do next.

 

Fast forward a year and a half

When Gagan was in back in town, we got together for dinner. I couldn’t believe the transformation. He was lean and fit, looked ten years younger and was in high spirits.

 

Gagan had left his previous company to lead the supply chain IT at another fast-growing company. In many ways, the nature and dynamics of his new company was no different from that of his previous company.

 

The biggest difference? The new company had invested in a leading-edge supply chain platform, giving new life to the mantra “agility and flexibility.” Here is how the new system supports the business and improves supply chain management:

 

  • Cloud-based, always-on planning: No longer are batch jobs needed for planning (other than bringing in data at an appropriate cadence and frequency). The system itself was always on, sensing changes and responding rapidly in real time. The solution was Software as a Service (SaaS), eliminating hardware procurement and stack configuration lead time, saving valuable weeks and months.
  • Data harmonization to support inorganic growth: While the company perfected the onboarding process for the new businesses they acquired, the platform’s data harmonization capabilities allowed them to generate an end-to-end view of their supply chain without having to consolidate underlying systems.
  • Simulation capability: During a recent hurricane, several company suppliers went down. Using the new system, supply chain planners quickly simulated recovery plans and locked in alternate supply sources well ahead of their competition. “Agility and flexibility” at its finest.
  • Changing role of IT: The system’s self-service capabilities gave power users the ability to configure reports and make changes to models as the business evolved, freeing up Gagan’s team to focus on newer, best-of-breed technologies to augment the organization’s capabilities. The role of IT significantly changed in his new world.

Now, Gagan even found time to take up running again—and finished a marathon in a personal best time.

 

I wondered if Gagan’s new company had a chief digital officer. They did not. However, Gagan elaborated for me.

 

“We did hire a young digital transformation specialist in the IT organization. We couldn’t have done it all without her support. She was instrumental in helping select the right technologies and hire the right talent. She collaborated with my team and the business on use cases and end-user personas, helping us lay a solid foundation for the new platform, with my team supporting the change across the business.”

 

I asked how Gagan could possibly top this news, to which he responded, “Well, I was just promoted to CIO!”

 

Do you have a story to tell? Comment below to share how the importance of supply chain management and the digital transformation affects your strategies for business success.

 

The post Supply chain agility and flexibility: The story of an IT executive appeared first on The 21st Century Supply Chain.

 

Avaya digital transformation - Kinaxis

 

Originally posted by Dr. Madhav Durbha at https://blog.kinaxis.com/2018/03/supply-chain-agility-and-flexibility-the-story-of-an-it-executive/

by Alexa Cheater

It’s not just supply chain planners who benefit from improved S&OP

 

It’s the entire company—from planners to executives and everyone in between.

Effective, efficient sales and operations planning (S&OP) means you can respond to changes faster, spot opportunities earlier and better align your organization around a common set of goals.

 

But the benefits of S&OP extend beyond that—they help to simplify the day-to-day work of nearly everyone in your company. Improving S&OP means breaking down silos, connecting disparate data sources, exploring what-if simulations and developing cross-functional collaboration.

 

If you’re an executive, that translates into the ability to see a complete picture of the entire supply chain in an instant, with the most up-to-date data and changes reflected. Since you’ll be able to see risk or opportunity earlier, you’ll be able to make smarter business decisions faster, keeping your company on track to competition and financial success.

 

If you work in finance, improved S&OP means peace of mind that everyone puts what’s best for the business at the heart of every decision they make. Instead of working to individual or functional metrics, the entire organization aligns to key financial goals.

 

If you’re a supply chain manager, you’ll also get peace of mind knowing your actions and decisions benefit both your team and the whole organization, since you’ll be able to see the impacts of any changes you make across the entire network. And with faster, more streamlined S&OP processes, you’ll be able to ensure critical decisions are made collaboratively in a timely manner.

 

If you’re a supply chain planner, your daily life will become simpler. No more wasting time chasing down data. No more sorting through countless emails just to get caught up on an issue. No more making decisions in the dark. You’ll gain the confidence you need to make more informed decisions, and the freedom to focus on the true exceptions, instead of getting bogged down by small day-to-day changes.

 

Want to learn more about how to improve your S&OP to better align your organization? Check out our S&OP solution guide where we highlight the importance of data, processes and people.

 

 

The post It’s not just supply chain planners who benefit from improved S&OP appeared first on The 21st Century Supply Chain.

 

Nucleus Research Control Tower Value Matrix

 

Originally posted by Alexa Cheater at https://blog.kinaxis.com/2018/03/its-not-just-supply-chain-planners-who-benefit-from-improved-sop/

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