This post is an extract from a letter sent by Koray Dogan, our CEO, to all of Solvoyo’s customers and supporters in late 2015.
As we all reflect on the year that has been and think about the year that will be – I want to share a few thoughts with our community of supply chain managers, planners and thought leaders about changes, innovation and ideas shaping our way forward:
1) Closing the gap between planning and execution: Much has been focused and spent on getting better forecasting, data analytics, and supply chain design tools. Yet, we have not seen widespread evidence that planning productivity or key supply chain metrics like inventory levels, operating margins or transportation costs improved meaningfully. The missing link here is the failure to translate planning insights into everyday actions in a scalable manner.
This gap between plans and execution actions is no longer acceptable in 2016. Advancements in closed loop planning systems have closed this gap by creating immediately executable plans that result in dramatic improvements in planning productivity and supply chain performance.
2) Planning for a better planet: With the recent COP21 agreement – climate changeand the urgent need to cut carbon emissions can no longer be ignored.With 45% of emissions coming from the production and transportation of goods – supply chain planners and managers have an unquestioned responsibility to do something about it.
Incorporating carbon data into supply chain planning is a good first step. Just as you would for other business objectives, running what-if analyses and scenario planning can help illuminate a path to a lower carbon footprint. Read: Five steps to a lower carbon supply chain plan. In 2016, supply chain planners need to be ahead of the curve and start thinking about this before legislative, financial markets, or consumer behavior changes tie up our hands.
3) Cloud and what Bezos’ law means for you: While certainly not a new idea, cloud computing will continue to transform how we plan supply chains in 2016. The increased need for collaborative tools, shorter planning cycles, and on-demand computational power – all play to increasing cloud adoption in supply chain planning.
Market forces including increased competition means cloud costs are declining. In fact our recent partnership announcement with Microsoft helped us convince more clients to adopt the cloud for supply chain planning. In 2016, look out for more advanced cloud-based supply chain planning capabilities.
4) Planning for the future: Internet-of-Things (IoT), 3-D printing, machine learning, and the coming age of big data mean planning platforms have to be much sharper to mine and manage data. Now more than ever, a company’s ability to sort and plan through myriad of data will increasingly separate leaders from followers.
No company can sustainably grow or be profitable without core planning capabilities that make use of big data. Often when I speak to clients about their before and after experience having adopted advanced planning, the stories are remarkably consistent: planning is now a disciplined, collaborative and tractable process where you leave work every day confident about having utilized all available data and used company resources optimally with the best laid plans.
With these parting thoughts, from all of us at Solvoyo – I would like to wish you all a very happy holiday season and New Year. May all your plans come to fruition and you have a prosperous 2016.
Logistics are part of supply chains. The purpose of a supply chain is to do one thing – enable a company to grow. However, focusing only on transportation will reduce costs but invariably will cause issues in other areas.