Digitisation of supply chain to ensure smooth manufacturing in the ‘new normal’

Manufacturers are faced with a tough question of how to produce with the constraints of the 'new normal'. What seems certain in times of the pandemic is that digital will become the backbone of production.

By:June 28, 2020 3:09 PM
digitisation of supply chainImage representational purpose only

We are currently going through the biggest crisis of our lifetime. While lockdown has been lifted, the situation on ground has not changed a lot, with challenges to run manufacturing plants becoming bigger every day as uncertainties in supply chain and workforce availability increase. Enterprises are doing their best to estimate product demand, inventory to be maintained, raw material and resource availability, but manufacturing in the ‘new normal’ has shifted from monthly or weekly planning to daily production planning.

Leaders are faced with a tough question of how to produce with these new constraints. What seems certain in this era of ‘new normal’ is that digital will become the backbone of the factories. Process automation in plants was always taken with a pinch of salt but now it will be the most desired thing to have.

Challenges during COVID

Customer demand and preference of what to buy and how to buy has changed drastically so leaders need to have the right insights to do product rationalization. Inventory levels need to be adjusted based on demand, raw materials to be procured based on updated production plans. Logistics is another challenge impacting the supplies as transportation is still not normal and this again impacts the procurement decisions.

Solution is in Digital

Every organization, large or MSME should use this time as an opportunity to accelerate the adoption of AI, IoT and Analytics to integrate customers, employees and vendors through digital platforms.

We all are talking today of making supply chains predictable & resilient, but how to do it. How do leaders keep a balance between risk management and cost? If they reduce the risk in meeting customer and production demand then cost will increase and vice-versa. The answer lies in bringing agility in the system through the adoption of emerging technologies in our processes. Scenario planning has to happen daily, not even weekly and the same is production planning. One month is a long term planning in current times.

Getting on to what technology can do for us, the first step in the journey towards digital is to have way to capture the right data points in every process and integrate it to make it available for analysis. AI and ML-based algorithms built on the historical data can be of great help to forecast the demand and supply, these are the self-learning mathematical models that keeps evolving with the changes in constraints. The output from these supply chain models along with workforce data can be of big help to build a robust production planning system.

Also read: Manufacturing during lockdown & post-COVID must be digitised for greater safety & efficacy

IoT based location tracking solutions can improve the logistics predictability by tracking the raw materials supply and delivery of products to customers. These solutions also help in monitoring quality during transit. Products that can undergo changes due to environmental parameters can be specifically remotely monitoring using different kinds of sensors like temperature, moisture and others. Another application of this solution can be to monitor the health of truck drivers while they are on the road as their health parameters can also be remotely monitored and action can be taken by logistics vendors in case of health issues.

Startups can help

There are lots of start-ups in the country, who are working on innovative supply chain solutions and have deployed successfully across various industries. These start-ups add a lot to the agility as they are quick to implement and flexible in approach, plus solutions from them don’t cost much. Uncertainty and complexity is of the highest order now and it will not be easy to layout plans without following a structured approach. Design thinking is a proven methodology under these kinds of scenarios and the tools under it need to be leveraged as much as possible.

Author: Amit Saluja, Senior Director & Manufacturing Vertical Leader, NASSCOM CoE – IoT Ecosystem for IoT Startups, Gandhinagar

Disclaimer: The views and opinions expressed in this article are solely those of the original author. These views and opinions do not represent those of The Indian Express Group or its employees.

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