Demand forecasting plays an important role in manufacturing. That fact isn’t changing; what is changing is how it’s done. Whereas in the past, forecasting had an aura of magic about it, relying heavily on the intuition and experience of the planner doing the forecasting, today it’s largely a data-driven practice. Before Industry 4.0, historical data was combined with gut feelings to produce a sort of crystal ball-like prediction of what the future held for the company in terms of demand and buyer behavior, and by extension what the company should focus on producing. Everyone basically crossed their fingers and hoped for the best. Post-Industry 4.0, this has changed dramatically, with a heavy reliance on advanced predictive analytics being fed data from IoT sensors deployed throughout the supply chain.

In the past few years, supply chain digitization has evolved from a hypothetical into a reality for many manufacturing businesses. The digital supply chain has become in many ways a key component of the rise of Industry 4.0, pushing businesses to adopt increasingly digitized planning and reporting solutions cross-operationally in order to stay competitive. Going forward, digitization’s importance is likely to continue increasing as companies strive to build more integrated and transparent operations. Here are a few fascinating facts about digitization in the supply chain.

No matter how sophisticated your methods, or how intimate your knowledge of the field, no demand or sales forecast will ever be 100% accurate. Just as supply chain disruptions are simply a fact of life in the world of manufacturing, deviation from a your expected outcomes are unavoidable. Given this state of affairs, you may be wondering if it’s worth expending resources on improving forecast quality. This feeling is understandable, but while there will always be a gap between expectations and reality, the rise of Industry 4.0 has improved our ability to predict future outcomes. With modern IT solutions and business processes, it’s possible to escape the past-oriented planning models of yesteryear (which fail to account for future developments) and drive towards a more future-oriented approach.

With a name like “intelligent planning,” it’s hard to imagine that many companies would express a strong preference to do the opposite. And yet, despite intelligent planning’s status as a potential value-added proposition with the ability to smooth out production and transport workflows, many businesses have been slow to implement smarter scheduling and operational planning processes. The reason for this is simple: many modern manufacturers are stuck in the past when it comes to data visibility and planning workflows. Production plans created with pen and ink or Excel spreadsheets can never provide the level of agility, flexibility, or transparency that a lean supply chain requires, but many companies’ planning workflows are unable to evolve do to widespread planning silos and shadow IT.

Although automotive manufacturers have been hearing for years that Big Data is the next big thing, studies often show that executives, not just in automotive but across many different industries, fear that their organizations aren’t ready to take advantage of the new advancements in analytics. Big Data analytics can and will be a huge value-added proposition for companies hoping to stay competitive in the world of Industry 4.0, but it’s true that reaping the benefits of new technological insights often requires significant changes in workflows and IT infrastructure. Luckily, these changes are often not as daunting as they first appear. Here are a few suggestions for getting the most out of your advanced analytics.

Imagine you’re playing musical chairs. The music starts and stops and your instinct is to rush to the nearest seat before your competitors beat to you to it—but instead of a circle or a row of chairs, the chairs are scattered and hidden around the building at random. No one knows how many chairs there are, and no one is sure how to reset them before the next round begins. Surely this would be a confusing way to play the game, just as it would be a confusing way to run a business. And yet, many companies do just that, keeping real resource allocation hidden within planning siloes and mission critical data obscured by layers of disconnected IT infrastructure. The result is that long term cross-operational planning becomes impossible, with planners stuck in a reactive loop of constantly responding to roadblocks without the ability to be proactive. Integrated planning has long been touted as cost saving solution for complex businesses, one that specifically addresses the break-fix mentality that mires companies in minute-to-minute logistical snafus, but what is it, exactly, and how does it work? 

Buzzwords abound in today’s manufacturing and logistics industry. As technologies develop, emerge, and take hold, so does a new vocabulary companies must embrace in order to successfully leverage the concepts, principles, and philosophies of an ever-evolving business landscape. One such buzzword or topic of the day many planners and managers come in contact with yet fail to fully realize is postmodern ERP. Whether it’s because the lack of visibility surrounding these concepts or a failure to fully embrace them as part of lean manufacturing and supply chain management, postmodern ERP is perhaps one of the most least understood or actualized elements of manufacturing and supply logistics. Not only does postmodern ERP have the potential to transform a company’s manufacturing and supply logistics, but it’s a key element in cutting the complexity of global supply chain management and leveraging enhanced operational functionality.

As something of a branch from enterprise resource planning (ERP), postmodern ERP takes the next step in helping companies across a number of critical functions in planning and production. But in furthering our understand of these buzzwords or key terms (like postmodern ERP), today’s manufacturing and logistics companies must ask themselves: What is so modern about postmodern ERP? What does postmodern ERP actually mean in terms of the day-to-day operations? What is the true value proposition of postmodern ERP in a global production and logistics network?

Today’s manufacturing and supply chain planners and managers are inundated with concepts and strategies purporting to add value to their overall value chain. Whether it’s integrating intelligent planning systems or working to streamline their manufacturing processes from procurement to production, manufacturing companies must seek value in any number of ways in order to remain competitive and agile in an increasingly global marketplace.

One place where manufacturing companies have been comparatively slow in realizing and leveraging value is enterprise resource planning (ERP), or more specifically, adopting a postmodern ERP mindset. Whether it’s because the lack of visibility surrounding these concepts or a failure to fully embrace them as part of lean manufacturing and supply chain management, postmodern ERP is perhaps one of the most least understood or realized element of manufacturing and supply logistics. Not only does postmodern ERP have the potential to transform a company’s manufacturing and supply logistics, but it’s a key element in cutting the complexity of global supply chain management and leveraging enhanced operational functionality.

We’ve discussed a great deal on this blog about the elements necessary for optimizing or enhancing global supply chain management and logistics. These elements vary from effective communication and breaking down cross-functional silos to the deployment of critical technology platforms such as Industry 4.0, advanced analytics, and Big Data. However, we’ve devoted very little time to examining the flipside of this coin: The factors associated with global supply chain management which significantly hamper or even derail your production and supply streams.

While the most detrimental factors to effective supply chain management have shifted and evolved during the last decade alongside the platforms and strategies planners and managers deploy, many of the fundamental aspects as to why a supply network succeeds or fails have remained since the 1990’s and early 2000’s. Point being: While staying on top of new technologies or software solutions can be difficult, understanding and addressing the critical challenges and pain points is a much simpler task given these elements have stayed unchanged throughout recent times.

There are some terms or concepts in today’s modern supply chain management landscape that even industry insiders have difficulty defining or understanding. Whether it’s because the lack of visibility surrounding these concepts or a failure to fully embrace them as part of lean manufacturing and supply chain management, postmodern ERP is perhaps one of the most least understood or realized element of manufacturing and supply logistics. Not only does postmodern ERP have the potential to transform a company’s manufacturing and supply logistics, but it’s a key element in cutting the complexity of global supply chain management and leveraging enhanced operational functionality.

The question becomes: Why is postmodern ERP such an important value proposition for global manufacturing companies lacking visibility and understanding? What is it about postmodern ERP that proves difficult for planners and managers to embrace? What do we mean when we use the term postmodern ERP?