I interviewed Milan Vyas who discussed Supply Chain 4.0 – Time for Supply Chain Transformation.
1. Please provide a brief background of yourself.
Hi, Dustin, Thank you for your time & providing an opportunity to introduce my professional experience, and knowledge base.It is a pleasure and great honor to share insights of Supply Chain Management with you.
My name is Milan Vyas. Originally I am from India but currently I am working at Kenyain Africa. I have an excellent track record to build a globally integrated end to end Supply Chain that will add value and provide an competitive edge to the organization and delivered growth for more than 18 years through progressive multi-cultural work experience in all field of ERP based Lean & Agile Supply Chain in multiple Industries like FMCG – Food & Beverages, Building Materials & Consumer Goods, Manufacturing, ICT and Telecom – GSM & CDMA.
I have demonstrated results in maximizing customer service levels and company’s profitability through managing all aspects of Supply chain including Strategic Procurement & Contracts management based on Categorization & Spend Analysis, Total Cost of Ownership (TCO) Model, robust S&OP & Continuous process improvements, Inventory Management & Control, Strategic Supplier Relationship Management, Warehousing & Distribution and achieve stake holder’s satisfaction by providing an efficient, responsive and reliable Logistic Solutions.
I am fortunate to associate with big brands & industry leaders like BIDCO Africa Ltd. in East & Central Africa and progressive and performance driven organizations like Formica Group owned by Fletcher Building, TATA DOCOMO and Vodafone in India during my professional journey till date. Build credibility by being consistent, showing competence, commitment and concern for people.
I am a “SAP Power User” for SAP R/3 MM Module & End User of ORACLE 11i ERP System. Played a lead role in designing & implementation of SAP ERP system at pan India level at TATA DOCOMO.
I have completed Bachelor of Engineering (B.E.) in Production and also did PG Diploma in International Business Management. On quality front, I am certified “Supply Chain & Materials Management Professional” and also life member of IIMM - Indian Institute of Materials Management & IFPSM - The International Federation of Purchasing and Supply Management.
My aim is to spread the knowledge & updates about Supply Chain Management among the supply chain professionals; which helps them to improve their businesses as well. I am driven by this vision and I am inspired by what I am doing.I have contributed my domain expertise & experience of Supply Chain Management in form of articles in various publications of IIMM.
Going through my professional experience and profile, you find that I am very passionate Supply Chain Professional and I am looking forward to contribute more and make a difference in this profession.
2. What is Supply Chain 4.0 and what experience do you have with it?
Disrupt or be disrupted…. That is the reality facing businesses and their supply chain organizations in this digital era, where business models change as quickly as new competitors or new market opportunities emerge.
Digitization creates a disruption and requires companies to rethink the way they design their supply chain; in order to maintain and grow market share. At the same time, globalization, market volatility, and customer’s demands are growing and continue to become more complex. A recent online trends in e-commerce; have led to strong growth of SKU Portfolio and increase service expectations combined with customized orders and multiple last mile delivery options.Most company’s fulfillment models seem to be static and not flexible; so struggling to manage the cost and complexity of the new omnichannel world.
Experts would usually claim that supply chain management is about delivering The Right product, at the Right place, at the Right time at the lowest cost, with the agreed service level, right? Well not anymore now. Until recently, we were used to looking at supply chains as cost drivers, not sales drivers. Now it is about increasing sales& profits, creating more value and capturing it.
Ensuring the supply chain can consistently meet business objectives in this increasingly complex environment is becoming more and more difficult through traditional operational structures and mindsets. It’s critical that there is not only an alignment of the supply chain strategy to a Company’s overall growth strategy, but also consideration of the direction in which the world is heading.
With complexity growing, an evolution of the supply chain needs to begin now. So Welcome to Supply Chain 4.0.
Roughly it is a broad vision of tomorrow's Supply Chain. The ultimate goal for Supply Chain 4.0 is to create a blueprint of the next generation of supply chain that will drive a company’s business in the future.
Supply Chain 4.0 provides a framework of capabilities that can help companies profitably meet future demands with increasing market complexity and customer expectations.
This ecosystem is based on implementation of a wide range of digital technologies like Big Data & Prescriptive Analytics, the Internet of Things, Cloud Computing, 3D printing, augmented reality, robotics, smart sensors, track & trace solutions, Drones, and others. The goal of the digital supply chain is to fully integrate and make visible every aspect of the movement of goods.
Digitization leads to Supply Chain 4.0 which becomes:
- More Faster & Responsive
- More Flexible, Agile & Scalable
- More Smart & Intelligent
- More Accurate with real time visibility
- More Efficient
Supply Chain 4.0 will affect all areas of supply-chain management. I would like to share my experience of two important links of Digital Supply Chain – Smart Warehousing and Logistic Visibility. Your distribution center DC and Logistic operations promise to become a strategic tool in how companies operate and generate value for their customers. Here, the aim is to improve efficiency and safety through the automation of virtually every ordinary warehousing activity.
Currently I am working with our CIO to implement latest technologies of Smart Warehousing - WMS &Logistic Visibility - TMS and integrate with our SAP ERP System with the goal of pleasing consumers and increasing sales.
Leveraging digitization in the warehouse will provide you agility for omnichannel order fulfillment with real time inventory visibility & accuracy, reduce cycle time, improve productivity, optimized put away, minimize returns, intelligent & error free picking, increase throughput and decrease lost sales — delivering real business advantage.
Not only will the integration of Transportation Management System (TMS) with your WMS & ERP, improve the overall operational efficiency of your supply chain in terms of load & route optimization, dock appointment scheduling, end to end process visibility, real time updates, and reduce shipping errors but, it will also greatly enhance the customer experience by providing full visibility to consumers about their shipments and auto alert can be set up based on specific customer needs.
By integrating modern technologies into your warehouse & logistics operations, you can greatly increase your productivity, maximize efficiency and drive down costs - empowering operational excellence, on-time customer orders fulfillment and, ultimately achieve customer satisfaction.
We are entering the age of “experience” economies. This means that the way companies deliver customer value is different, and the customer experience is the new battlefield for competitive differentiation. The new competitive differentiator is understanding what customers want before they ask for it, sometimes solving problems customers didn’t realize they had. Amazon is best example for it. Customers today are focused on getting what they want and when they want it.
McDonald's, for example, is more a supply chain company than it is a food company. What it does logistically is remarkable.
At other companies such as Apple, where product is excellent, but an efficient supply chain allows the business model to operate at a much higher level.
In order to improve as a business, it’s essential to continually adapt to emerging supply chain technology applications to create better visibility within your supply chain, which will enable you to have more control over your business and stay ahead of the competition.
We have a lot of tools to understand supply chain costs, like “total cost of ownership”, “spend analysis” or “total landed cost”, but none about increasing sales. However, technology is bringing about a fundamental change and Supply Chain 4.0 requires a very different view – focusing on increasing sales through a better understanding of how customers behave.
3. How is it done effectively?
The transformation from current supply chain operating models to Supply Chain 4.0 isn’t simple, but not addressing these challenges will be an equation for losing market share in a growing competitive market.
“Getting to the future of supply chain capabilities would require breaking down functional silos, redefining priorities, and building synchronized planning and fulfillment capabilities.”
There is no “one-size-fits-all” supply-chain operating model.
1. First step is Make a detailed strategic plan. Evaluate your own digital maturity now and set a clear targets for the next five years. Prioritize the measures that will bring the most value to your business and make sure these are aligned with your overall strategy.
2. Second step is define the capabilities you need.To implement a new capability, you’ll need to consider three strategic dimensions: people, process and technology.
- Focusing on people: Develop strategies for attracting people with the right digital skills. Your success with Supply Chain 4.0 will depend on skills and knowledge. Your biggest constraints may well be your ability to recruit new employees or train existing ones who can put digitization into place.
- Integration of processes: One of the most important changes is to focus on an end-to-end process perspective. That will foster new collaboration models.
- Implementing New Technology: Digital Technologies and Supply Chains are converging to create a new Digital Supply Chain Network, driving greater business value.
3. Third step is transform into a Digital Enterprise: Foster a digital culture, where all your employees will need to think and act like digital natives, willing to experiment with new technologies and learn new ways of operating.
4. Fourth & last step is Actively Plan an ecosystem approach: Real breakthroughs in performance happen when you actively understand consumer behavior and can orchestrate your company’s role within the future ecosystem of partners, suppliers and customers.
Once Bill Gates said that:
“The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.”
So “Technology will only deliver the intended positive results if it is implemented with strategy and operations that adhere to best practice in supply chain management. Get basics right first. Not even the smartest technology can compensate for less-than-best practices,”
4. Where have you seen good results?
The degree of transformation for supply chains will depend on the industry sector and company, but this will change radically over the next three to five years, with different industries implementing Supply Chain 4.0 at different speeds.
I strongly believe that companies may achieve exponential gains by acting on some of the supply chain digital levers not presently judged as creating revolutionary change over the next three years.
On average, companies expect to reduce operational costs by 3.6% per year, while increasing efficiency by 4.1% annually.
Supply chain professionals expect big benefits from continued digitalization in their supply chains including greater transparency and flexibility, reduction in inventories and delivery times, efficient customer service, reduce operational cost and increase sale & profits.
In short, the digital supply chain will offer a new degree of resiliency and responsiveness enabling companies that get there first to beat the competition in the effort to provide customers with the most efficient and transparent service delivery.