By Mungo Park, President of SAPICS
 
At the beginning of every new year, it is customary to give an opinion of the trends that are emerging or that are likely to develop further during the course of that year.  Supply chain management is no different, as the discipline is constantly evolving in the quest for ever improving service levels through increased efficiency and effectiveness.
 
Some of the current technology trends attracting a lot of international interest, such as increased automation and robotics, self-driving vehicles and drone deliveries, as well as 3D printing certainly remain long term trends, but not necessarily for 2017.
 
Supply chain trends will continue to be driven by the need to support business in meeting customer expectations while continuing to better manage and control costs. As a result, priorities for supply chain executives this year will include:
 
Supply chain analytics
The use of supply chain analytics and business intelligence will increase as organisations work to improve control and visibility of the extended supply chain. Awareness of the supply chain as a strategic business lever will also continue to grow, while supply chain event management and measurement will provide the fulcrum. 
 
Furthermore, accurate reporting and the ability to analyse reports will enable business to identify poor performing partners, highlight inefficiencies and weak links in the chain, identify opportunities for efficiency improvement, increase collaboration, as well as better supply chain cost management.

Ongoing eCommerce challenges
The rate of growth of online retail versus bricks and mortar retail is set to continue. This will put pressure on businesses to meet the ever increasing expectation of online shoppers for prompt, on-time delivery of purchases.
 
Couriers and distribution service providers will be expected to be more efficient while under pressure to be cost competitive. As the eCommerce side of a business grows, more sophisticated warehousing solutions will be required to meet the accuracy and timelines demanded by an online business.
 
This could lead to the outsourcing of eCommerce warehousing to specialist service providers.  Supplier/partner integration will be a key success factor, as will accurate tracking and delivery status communication to the customer.

Technology and automation
While significant advances are being made in the use of technology to facilitate supply chain efficiency, in South Africa there is the additional challenge of balancing the level of automation with labour.  Augmented reality, can provide improvements in accuracy and efficiency in picking and load planning, as well as packing, but can also be a useful tool to support and train less skilled logistics staff.
 
It will be important to invest wisely in technology to ensure a good return.

Skills and resources
An independent report found that 45% of South African supply chain managers believe they do not have the skills to do their job properly. Further research also suggests that those who do possess strong quantitative abilities often lack equally important interpersonal and leadership skills.
 
Finding and retaining skilled supply chain staff as well as managers will continue to be challenging. Organisations will need to invest in training at all levels to develop the skills necessary to ensure the sustainability of their supply chains.

Increased SCM risk and disruption
As supply chains extend and reliance on global suppliers and partners increases, supply chain risk and disruption can be expected to continue. Rationalisation of suppliers and improved collaboration with preferred suppliers can help mitigate risk, but it is important to identify alternative sources of supply for products, critical components and materials.
 
Therefore, contingency plans should be put in place to enable quick response to unanticipated disruption and ensure business continuity.
 
It is further important to build resilience and predictability into a supply chain to avoid being the cause of your own disruption. Supply chain planning, visibility and measurement continue to be key disciplines critical to minimise unnecessary disruption, while collaborative partnerships with reputable, well established logistics service providers will also make your supply chains more resilient.
 
It’s good to look forward to an exciting year that won’t be without it’s challenges, but that will also be full of opportunity. I believe that the supply chain is one of the primary keys to the success of an organisation and that if it is robust it will continue to provide a platform for strategic competitive advantage.  
 
This article originally appeared in Bizcommunity’s 2017 BizTrends feature http://www.bizcommunity.com/Article/196/729/156078.html

ENDS

MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, [email protected], www.atthatpoint.co.za
 
ABOUT SAPICS – your supply chain community
SAPICS is a professional knowledge-based association that enables individuals and organisations to improve business performance. SAPICS builds operations management excellence in individuals and enterprises through superior education and training, internationally recognised certifications, comprehensive resources and a countrywide network of accomplished industry professionals. This network is ever expanding and now includes associates in other African countries.
 
For more information on SAPICS please visit:
Website: www.sapics.org.za
Twitter: @SAPICS01
LinkedIn: SAPICS group
Facebook: OperationsManagement
 
ABOUT APICS
SAPICS is a proud APICS' exclusive Premier Channel Partner for Sub Saharan Africa. APICS is the leading professional association for supply chain and operations management and the premier provider of research, education and certification programs that elevate end-to-end supply chain excellence, innovation and resilience. APICS Certified in Production and Inventory Management (CPIM), APICS Certified Supply Chain Professional (CSCP) and the brand new APICS Certified in Logistics, Distribution and Transport (CLTD) designations set the industry standard. With over 37,000 members and more than 250 international partners, APICS is transforming the way people do business, drive growth and reach global customers.  APICS is based in the USA and has a broad global footprint.
www.apics.org

Different to the tourism or marketing environments where digital integration has been absorbed organically, supply chain and manufacturing professionals have been sluggish to phase out what is a deeply entrenched traditional mentality.

Thinking must change
Prominent supply chain analyst and founder of Supply Chain Insight, Lora Cecere, believes that supply chain professionals have defined their processes as linear and inflexible; trusting enterprise resource planning (ERP) and advance planning and scheduling (APS) to optimise production and distribution processes.

“To become digital, we need to define processes from the customer’s customer to the supplier’s supplier and use new technologies to listen, sense, and adapt,” explains Cecere. “This is not the platform of traditional technologies and the belief structures of traditional supply chain leaders. This is an opportunity for Africa. Consider the adoption of mobile phones, alternative payment structures and collaborative sharing in economies such as in Nigeria. It’s time that we question the status quo and traditional principles.” 

Cecere will in June join Flatiron Strategies’ Senior Industry Analyst, Peter Vanderminden; and Oracle’s digital supply chain expert, Maha Muzumdar; to speak at the 38th Annual SAPICS Conference and Exhibition for supply chain professionals, to be held at Sun City, 12-14 June 2016.

The trio, while encouraging organisations to pursue a digital supply chain, accepts that this progression isn’t without flaws that businesses must take cognisance of.

Big data, big concerns
While the emerging IoT (Internet of Things) delivers huge dividends, it also presents potential data security risks for manufacturers as numerous corporate assets and end products will be linked via networks to provide a steady flow of real time data.  As data volumes and Internet connectivity grow in the supply chain and on the manufacturing floor, there is increased risk of data security being compromised, cautions Maha Muzumdar, Vice President of Industry Transformation, Oracle Cloud Business Group.

“Manufacturers today need to be more vigilant of intellectual property and trade secret violations and potential corporate espionage,” adds Muzumdar. “Today there are new security issues for companies to deal with as automation and data volumes increase.  Data security needs to be addressed at multiple levels - the enterprise level, the shop floor level and at the user device level.  Companies need a comprehensive portfolio of security strategies such as identity management, access management and mobile security to ensure data privacy, protect against internal and external threats, and enable regulatory compliance.”
 
While IoT devices – such as digital sensors – forgo the need for manual input of data, thus achieving greater accuracy, businesses must also be able to use this new flood of data effectively. This, too, can present a problem, explains Peter Vanderminden, Senior Industry Analyst at Flatiron Strategies
 
“This does result in a flood of ‘big data’ which organisations may not have the capability to analyse and use effectively.  That is where the breakdown often happens.  As you implement IoT capabilities into your products, making them digital, it’s all about how we bring both these worlds together – converging IoT operational with traditional SCM IT and bringing the physical and digital supply chain together,” he says.

For more information on #SAPICS2016, or to register, visit conference.sapics.org

ENDS

MEDIA CONTACT: Juanita Vorster,  juanita@thatpoint.co.za, www.atthatpoint.co.za

For more information on SAPICS please visit:
Website: www.sapics.org.za
Twitter: @SAPICS01
LinkedIn: SAPICS group
Facebook: OperationsManagement

The supply chain management community of South Africa wants to highlight another critical error made in shifting the blame of the Nkandla scandal to supply chain mechanisms: the correct terminology to use would have been public procurement mechanisms.

The term supply chain describes far more than just procurement. This very specialised profession encompasses all activities needed to deliver the right product or service to the right customer, at the right time, place, and cost. Supply chain management theory delves deep into the efficiencies of sourcing, processing, manufacturing, transporting, storing, distributing, tracking, and returning anything from raw metals to household products sold in retail stores.

References to supply chain problems in the public sector as catchall term for public procurement policies that lead to fruitless and wasteful expenditure are not only inaccurate, but dangerous, as it shifts the focus away from the true problem at hand. It is also an insult to highly qualified professionals that ensure on a daily basis that South African consumers have easy access to a wide variety of local and imported products and services that make their lives possible and enjoyable.

Managing a supply chain demands an understanding of an entire value chain; all the suppliers that work seamlessly together to ensure that doctors have the necessary machinery to perform life-saving operations, that enjoying fresh seafood is possible even thousands of kilometers away from the sea, and that your online shopping order arrives at a time and place convenient for you.

The Western Cape province is an example of public sector organisations that have a solid grasp of the true meaning of supply chain. The proof is evident in an increase in clean audits, exceptional delivery of basic services to its citizens, and a number of other statistics that show that local government can serve with excellence its constituents within the framework of the Public Financial Management Act (PFMA) that set out public procurement – referred to as supply chain – processes.

While it can be argued that the matter at hand is one of semantics, something as small as a change in understanding that there is more to supply chain – and content citizens as a results – than just procuring goods and services within a legislative framework. The next step would be to ensure that all civil servant employed in a supply chain capacity are well trained in the theory of comprehensive supply chain management.

It would be a great feat if a year from now media reports could reflect the numbers of Certified Supply Chain Professionals ensuring service delivery to South African citizens, rather than the number of times supply chain mechanisms were blamed in error.

ENDS

Issued by: SAPICS - your supply chain community
MEDIA CONTACT: Juanita Vorster,  juanita@thatpoint.co.za, www.atthatpoint.co.za

For more information on SAPICS please visit:
Website: www.sapics.org.za
Twitter: @SAPICS01
LinkedIn: SAPICS group
Facebook: OperationsManagement

Service delivery to citizens and customers is influenced by the entire process of supply chain management, not just procurement or logistics.
 
“It is often easy to confuse supply chain with logistics, or even mistake it as a new name for purchasing or procurement,” warns Onnica Mailula, winner of the Best Speaker award at last year’s SAPICS conference for supply chain professionals. Mailula’s session used a well-known South African activity – the braai – to explain basic supply chain management principles. 
 
“There are several functional aspects that form part of the supply chain for a braai,” says Mailula. “Each function is crucial in ensuring that a successful braai is organised. In both supply chain management and an enjoyable braai, the sum is always more important than the individual elements.”
 
Demand management or forecasting relates to the number of guests invited to the braai, which determines the budget needed for the amount of meat, drinks, and side dishes. In supply chain management the details of this function normally goes all the way to a stock keeping unit (SKU) and even to a specific time horizon. Performed well, this function might even predict which of the guests will have a glass of beer at a specific time during the braai.
 
Making sure that the planned menu for the braai becomes a reality relies on a meticulous shopping list. The best lists include careful consideration of which shops provide the best quality products at the best price, and when to shop so ingredients are still fresh on the day of the braai.
 
Similarly, for business to operate efficiently, it is necessary to take vendor selection processes and supply agreements into account. Supply chain professionals must also ensure that the exact sequence and timing of events are planned to produce sufficient product to meet customer demand.
 
“Consider how many times a customer delivery was late or wrong and relate it back to the braai experience,” advises Mailula.
 
True to South African hospitality customs, there are usually ample leftovers after a braai. When these leftovers are divided between the guests using the host’s containers, the issue of returning the empty containers quickly becomes a point of lengthy discussion. The returns process in business is called reverse logistics, and is a specialist area of its own in supply chain management.
 
“While some of the functional areas of supply chain management are explained in simpler terms in this example, it does give a basic overview and understanding of what supply chain management entails,” says Mailula.
 
The different areas of speciality will be explored in formats suitable to both novice and advanced supply chain practitioners at the 38th Annual SAPICS Conference and Exhibition, 12-14 June 2016 at Sun City. More information and registration is available at conference.sapics.org

ENDS

MEDIA CONTACT: Cathlen Fourie, 012 644 2833, [email protected], www.atthatpoint.co.za

For more information on SAPICS please visit:
Website: www.sapics.org.za
Twitter: @SAPICS01
LinkedIn: SAPICS group
Facebook: OperationsManagement