Back to the Future of Supply Chains

Many finalists were extremely focused on ‘preparing for the future’ and ‘getting their supply chain ready for tomorrow’. Telefonica O2 UK, this year’s overall winner, wants to ‘configure next generation supply chains focused on how to serve the customer by ‘closing the order fulfilment loop’ and proactively integrating the product portfolio and the end-to-end customer experience’. Second placed Carlsberg believes that ‘extended collaboration’ will shape the way for the future for joint growth between strategic partners, while third placed Henkel emphasises ‘producing closer to market’ and “building smart technologies for real- time demand visibility’.
There was no surprise to see a very strong cost focus among many finalists, however what was particularly interesting was the emphasis in three key areas: supply base risk minimisation, intelligent use of technology to drive supply chain innovation and really for the first time, a focus on the environment as a strategic differentiator. We were delighted to see a significant number of entries for the supply chain innovation category this year. It was clear that many organisations are increasingly focused on how to “act differently” and to explore new ways of working in a search for continuing sources of improvement. We were able to characterise these into three types of innovation: innovation within the company; innovation within the industry; and finally (and most interestingly) innovation that transcends industries.
As an example, GSK, the winner of our Supply Chain Innovation award, has pioneered the use of leading supply chain thinking to support “differential development”, a paradigm change in the way it approaches clinical trials and impacting time to market. A real example of supply chain innovation driving transformation and a first in the industry, it is now leveraging this capability across other parts of its business.
Other examples of supply chain innovation were redesign of loading bays for improved health and safety, deferred packaging strategies to optimise logistics operations, dynamic modelling to drive benefits during an ERP implementation, pallet pooling, empty container optimisation, minimising of glass thickness and bulk liquid transport and model-based benchmarking.
A comparison of “supply chain practice maturity” has indicated a plateauing of supply chain capability. Despite all the great work we have seen in this year’s entries, I still remain concerned that companies are not developing enough innovative supply chain capability at a global level.
Ultimately what differentiated this year’s winner, Telefónica O2 UK, was the clear demonstration of how the supply chain can be used to support and enable the business strategy. Helping to deliver competitive advantage through focusing on some of the basics and going “back to the future” by investing in the development of a new set of supply chain capabilities to compete in a fiercely competitive market place.
Masood Hassan is UK supply chain lead principal at PRTM and was responsible for the facilitation of the judging process.