EVENT RECAP KEYNOTE 1
THE DIGITAL CONNECT
“Technological interventions are going to be the catalysts in the way we manage supply chain globally.” A crystal gaze from Subodha Kumar, Anderson Distinguished Chair Professor of Supply Chain, Marketing, Information Systems, Statistics, Fox School of Business, Temple University… Whenever you run with low inventory, lot of inefficiencies get exposed in the supply chain and the same challenge was evident during the COVID-19 period with the lockdown being imposed by countries. It’s a Wake Up call for all of us that we need to do a much better job in our operations and supply chain systems. With COVID-19, we are going to see a fundamental shift in the way supply chains have been functioning over the years. I would like to bring to you a classic example of 3M as to how it took the situation in its control and quickly adapted to the New Normal. At the start of the pandemic in the early January 2020, demand for N95 masks and healthcare equipment was on the rise, while other items were seeing a demand slump. 3M responded to this with an operational pivot: significantly ramping up production in some areas but cutting inventory elsewhere. The manufacturer developed surge capacity during the SARS outbreak in
the early 2000s — and two decades later, that experience enabled it to quickly accelerate production of high-priority SKUs during the COVID-19 pandemic. The manufacturer began ramping up production of N95 respirators in January, from 22 million per month prepandemic to 26 million. By June 2020, 3M was making 50 million respirators per month. It added two new respirator lines at a Wisconsin plant in Q3. It dropped non-critical SKUs and refitted production lines for critical supplies. All this was possible because of an enhanced technology system that the company invested in. 3M put its critical shipments on a renowned technology platform it has invested in to get realtime data in one place, which allows 3M to keep less buffer stock on hand. Getting parcel tracking live took less than one week. 3M's response does prove the value of real-time data and agility. Forecasting based on historical models was rendered ineffective during the pandemic, with real-time data proving more valuable. And demand shifted quickly at the consumer level, amplified the supply chain via the bullwhip effect and requiring suppliers to adjust on the fly. With this example, I would like to
reiterate the fact that your uncertainty is much less because you exactly know where the item is. That data translates into aligning inventory orders closely with demand, allowing the lean operations and balance sheets many supply chains strive to achieve.
VACCINE DISTRIBUTION Now as we are into the pandemic situation for almost a year and the vaccine is already out, the next issue in front of us is vaccine distribution. Last mile distribution and storage are going to be bigger challenges in managing the supply chain. We have to look at all these issues from the new lens. Technological interventions are going to be the catalysts in the way we manage supply chain globally. Talking about digital transformation, we have AI, machine learning, business analytics, etc. As far as business analytics is concerned, two things are emerging right now – we are witnessing a stream of data analytics, predictive model, etc. Another angle is from supply chain optimization perspective. Both have to work together to arrive at a holistic solution we need currently. It will lead to lot of interesting research and the academia will need to play an enabling role to solve such critical problems.
EMERGING TECHNOLOGIES If you think of digital innovations in healthcare, blockchain was clearly emerging as the next technology to bank on even before the pandemic. Blockchain in pharmacy is going to catch up faster than we could even imagine. Early
20 CELERITY March - April 2021
