What Do Your Customers In Supply Chain And Manufacturing Want?

GM of Trelleborg and an Engineering and Supply Chain Industry veteran with 20+ years experience managing businesses. (Views are solely mine)

The pandemic has seen empty shelves, panic buying, truck strikes and many items returned to the shelves. Supply chain issues have heavily impacted every industry, especially manufacturing. Even though the industry is slowly having a comeback, our problems with the supply chain are far from over.

So before we come up with solutions on efficient manufacturing strategies and optimizing the supply chain, we need to understand the problems plaguing our customers. The supply chain starts with the raw materials delivered from the supplier to a product/solution manufacturer and ends with the delivery of the finished goods to the customers. Manufacturing and supply chain are very closely tied together, and solutions for efficiency require us to look at the end-to-end value stream rather than just a portion of it.

That begs the question: What do our customers in supply chain and manufacturing really want, and how can software companies help?

As an expert in engineering, manufacturing and supply chain, I’ve identified four of the top areas where customers need help.

1. Supply Chain Resilience: Vendor And Supplier Framework

Say a company manufactures a product to be used in critical applications, there is lot of due diligence that needs to happen to qualify suppliers and vendors who will supply the raw material to manufacture those parts. With lead times at 6 months to a year, supply chain teams are faced with the challenge of sourcing their supplies and having a back-up for their current vendors. Say a vendor won’t supply a critical raw material, where else can the material be sourced from? Are there substitutes or alternatives? Is there a vendor network? Are there other companies in the network who have a surplus? Where is this information available as your WMS/ERP system schedules the material handling tasks within your facility?

What can supply chain software companies do?

• Create solution for a system that can connect with vendor/suppliers in the network.

• Identify surplus in the network that can be traded across businesses.

• Identify partners who may supply alternatives/substitutes.

• Uncover new opportunities by understanding and predicting the behavior of a network of vendors (predictive analysis).

• Ensure this solution works seamlessly and agnostically across WMS/ERP solutions.

2. Supply Chain Finance

Buyers and sellers in the supply chain sometimes have interests that are like a tug of war. Buyers often want to pay as late as they possibly can, and suppliers want to get paid as early as possible. With global supply chain transactions amounting to trillions of dollars, building a supply chain finance solution to bridge this gap is becoming urgent. This also helps companies optimize their working capital.

Receivable finance and buyer solutions have been around for a while with banks being at the center of it, with a few players providing buyer solutions. Today customers need solutions where they have faster access to cash, longer supplier payment terms, streamlined procurement process and quicker cash conversion.

What can supply chain software companies do?

• Create an analytics-driven solution that can work with ERP history on material, supply, invoices and purchase orders to create recommendations of vendors who are a great target for a buyer/supplier solutions, including early financing.

• Integrate financial processing solutions with the rest of supply chain, including procurement, shipping, invoicing and receiving.

3. Automation And Robotics

Every manufacturing and supply chain company requires automation, and robots are a great way to resolve the efficiency and labor problems that these industries face on a daily basis. However the application of robots in facilities are numerous (and usually needed at the same time), whether that means machine tending, material handling, receiving, shipping, assembly or packaging. What many customers really want is for a centralized system or solution to manage these bots seamlessly.

A machine-tending bot may be from one company, whereas an autonomous mobile robot (AMR) may be be a completely different type. Not to mention that bots for assembly may be a combination of bots that are deployed to automate the assembly line. For the head of operations and supply chain, who is required to ensure the seamless flow of goods from recieving to shipping, I think the biggest help would be for the bots to work seamlessly with the WMS/ERP system and talk to each other.

Say a package is coming for assembly two days after the machine manufactures it, and the AMRs pick it off the shelf, it would be beneficial if that information was available beforehand for effective planning and optimization.

What can supply chain software companies do?

• Make these bots talk to each other.

• Ensure software is bot-agnostic and can work seamlessly.

• Integrate with WMS/ERP software.

4. Visibility And Transparency

With growing awareness around sustainability and social responsibility, the consumer base often wants visibility and transparency around how their products are sourced. The ability to trace a product back to the raw material, the machine it was produced on, and the details of the lot number is becoming more and more important—especially around critical applications. Today’s customers not only want to know where the package is, many want to know everything about the product life cycle.

What can supply chain software companies do?

• Establish traceability of lot numbers for raw materials in the ERP system and the ability to provide recommendations via AI during material handling, i.e., issue a material from a traceable lot for a customer order.

• Build a trace-and-track application that integrates within the system to track the health of the product being shipped to the customer, i.e., tracking humidity and temperature to name a few.

Moving Forward

Many consumers have never been more conscious of the challenges associated with the supply chain in the manufacturing industry. There are opportunities for supply chain software companies to listen to the voice of the customer so that we can seek creative solutions.

Views are solely mine and do not reflect views/opinions of any of my current and past employers.

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