Drag & Drop multiple supply chains to unify into one robust system
A supply chain is a network between a company and its suppliers to produce and distribute a specific product to the final buyer. This network includes different activities, people, entities, information, and resources. The supply chain also represents the steps it takes to get the product or service from its original state to the customer. – Wikipedia
Supply chain is dynamic flow of material and information in a variety of directions. Depending on the product or service, the supply chain has to be equally vast and connected. And it doesn’t end at the end of a unit production but rather a new supply chain begins for building the next level of service or a greater derived product.
A supply chain never ends
An unit of supply chain is a network between a company and its suppliers to produce and distribute a specific product or service. The end produce comprises of many raw materials and services in a specific set of processes. Achieving a digitally executable supply chain is a state of honor for any organization. But in the age of experience, the journey for building a product doesn’t end as soon as the product leaves the factory door. The products in digital age are rapid iterations for improvement over themselves. And so their supply chains should support that inter-exchanges. The supply chains truly never end.
Internal housekeeping is not enough
Since the supply chains never end, it is just not enough to have a great supply chain for your house. Your own organization can have the greatest of the tools from SAP, IBM or Oracle. But as a manufacturer of greatest cars, phone, laptop, beverages, media or entertainment; Your inputs in supplies arrive from a variety of big and small independent organizations. And every other organization cannot have same exact system with same exact version and configuration for easy integrations. Therefore big corporations have a higher entry barrier for suppliers for efficient supply chain. But such an exclusivity of supply chain increases the cost of production and equivalent supplier risk. This Mckinsey report enlists the supply chain risks. Even geopolitical factors can disrupt your supply chain. That’s why agility of your supplying sources can be a great way to create resilient production system.
You can build a supply chain which connects to any sort of supply chain system, even for a supplying vendor with spreadsheet based supply chain but with a great quality of product with lower carbon footprint and highly sustainable business practice. Wouldn’t that be great for your business as well as the planet?
Supply chain integration is a process where the all in-scope the parties involved with the fulfillment of a product are integrated into a single system. This requires significant coordination and alignment in order to ensure everyone is effectively working toward the same goal at all times. When looking at the phases of supply chain integration, the heavy lifting of creating a baseline is always the first and foremost the defining exercise. The phases are below:
- Baseline – This is the first stage, and it is when every department or system within a company is managing their own supply chain, and related issues. Companies also refer to this as a siloed approach, and while it can have some benefits, it is quite inefficient.
- Functional Integration – In this next stage, all the different departments within a company will work together to help to improve efficiency and reduce cost. This could be done by combining orders, scheduling jobs together, or other important steps.
- Internal Supply Chain Integration – All the departments within a company are connected using the same systems. This will almost always involve using some type of IT infrastructure solution that allows the departments to work efficiently together, share their needs, and identify collaboration opportunities.
- External Supply Chain Integration – The final stage involves external vendors as well as all of the internal departments. Providing a vendor with system access, and encouraging them to function almost as another department helps to generate the best possible results.
Our state-of-the-art supply chain integration consists of structured 3 step transformation. The 3 steps of the process are baselining, functional integration and external integration.
Step 1 of 3 – Baselining is the first step to set the current state in clear and defined numbers for a common consensus on current and future state.
Step 2 of 3 – Second step of supply chain integration is finding and implementing an efficient integrated process. This is a step about people and process. Having right skills for people and right processes for achieving the desired results is imperative before technological integration.
Step 3 of 3 – The last step of technology integration is about enabling human organization to achieve superhuman performance. It has 2 parts: Internal and External. For internal organization, one needs to have a well connected and functional IT system for a functional organization developed in second step above. For the external organization, you need to enable access to vendor organizations with defined policy and framework. This completes the high level supply chain integration. Although a real integration is much more involved process requiring extensive program management, project management, thought leadership and organization level integration.
For showing you the powerful SOLYD Studio, we take a case of a beverages company operating with its bottling suppliers. The beverages company (TBC) has 5 suppliers for raw materials, carrier services, labeling, shipping, storage, handling and manpower, among many of the operational elements. Let’s call them S1, S2, S3, S4, & S5.
Each of the suppliers have their own supply chain management(SCM), enterprise resource planning(ERP) systems and other business systems for managing production, suppliers and buyers. TBC is a buyer for all these suppliers. Their CRM system must get the request for demands which should match with their resource planner system for getting started with the fulfilment. The supply chain system for each of the 6 parties involved has to work with all the other business systems for sale process to be as seamless as possible for an efficient and effective end user experience. A small scale supplier has basic business systems with Google sheets and office apps.
Current Situation: With every requisition from TBC, the suppliers(S1 to S5) respond with quotation. The approved quote is then supplied by the supplier, their delivery is tracked in few cases and the invoice is sent to TBC upon confirmation of delivery. The invoice gets paid to suppliers depending on the supplier agreement. This whole process is ad interim for suppliers due to constant changes in variations of fulfilment led by regulatory, market or financial conditions. The integrations are never final. Changes have to trickle down from major players for clarity among smaller players. In this case, suppliers have more dollar turnover are big. Small players often suffer the consequences of that and the quality also suffers. Business systems have gaps and not fully integrated due to constant changes in 100+ connecting systems.
Solyd Solution: We studied the API (incoming and outgoing) capabilities of the systems. Also we surveyed the system integration gaps which lead most to disruption in productivity or user experiences. Our solution design was implemented in following 3 steps:
- TBC: Create a blockchain gateway for every API which sends data out to specific recipients
- TBC: Create a smart contract on desired blockchain with multisig partner system on Studio
- Suppliers: For each of the pilot suppliers, create a reader API from the blockchain on studio to respond to the purchase request, quote request and invoicing capabilities. The two sides of integration looks as below picture from studio BPMN interface.
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