By Hernan Saenz and Joshua Kinkel ·
July 7, 2022
For more than a century, businesses have honed highly efficient, linear supply chains. Raw materials flowed in one direction, were transformed into a product, used and ultimately discarded in a waste heap. That approach now puts a firm’s competitiveness at risk.
To ensure supply in an increasingly volatile business landscape, companies need more resilient networks. Fast-changing consumer preferences and customization require increased flexibility and speed. And investors, consumers and governments expect more sustainable products and processes—with certifications to prove companies’ claims. Winning in the coming decade will require a transparent and circular value chain—one that reduces or reuses materials and remanufactures or recycles products—lowering cost and creating less waste.
It is a profound paradigm shift. And the technology is already available to trace each raw material that goes into a product and follow how a product is used and where it is discarded. In fact, digital traceability enables companies to meet and balance a broader set of business objectives, including efficiency, resilience, responsiveness and sustainability. It allows companies to redefine the boundary of operational excellence and set aspirational new goals.
How does it work? Traceability gives companies the ability to follow products and goods as they move along the value chain and to glean exact information about the provenance of inputs, supplier sourcing practices and conversion processes. With that data in hand, companies can make predictions, run scenarios and dynamically optimize operations. Leadership teams can serve customers better, identify unnecessary resource consumption, respond faster to changes in demand and fulfill orders more efficiently. They are also able to identify strategic value chain opportunities, innovate faster, minimize the impact of internal and external disruptions and certify sustainable processes and products.
By Hernan Saenz and Joshua Kinkel ·
July 7, 2022
For more than a century, businesses have honed highly efficient, linear supply chains. Raw materials flowed in one direction, were transformed into a product, used and ultimately discarded in a waste heap. That approach now puts a firm’s competitiveness at risk.
To ensure supply in an increasingly volatile business landscape, companies need more resilient networks. Fast-changing consumer preferences and customization require increased flexibility and speed. And investors, consumers and governments expect more sustainable products and processes—with certifications to prove companies’ claims. Winning in the coming decade will require a transparent and circular value chain—one that reduces or reuses materials and remanufactures or recycles products—lowering cost and creating less waste.
It is a profound paradigm shift. And the technology is already available to trace each raw material that goes into a product and follow how a product is used and where it is discarded. In fact, digital traceability enables companies to meet and balance a broader set of business objectives, including efficiency, resilience, responsiveness and sustainability. It allows companies to redefine the boundary of operational excellence and set aspirational new goals.
How does it work? Traceability gives companies the ability to follow products and goods as they move along the value chain and to glean exact information about the provenance of inputs, supplier sourcing practices and conversion processes. With that data in hand, companies can make predictions, run scenarios and dynamically optimize operations. Leadership teams can serve customers better, identify unnecessary resource consumption, respond faster to changes in demand and fulfill orders more efficiently. They are also able to identify strategic value chain opportunities, innovate faster, minimize the impact of internal and external disruptions and certify sustainable processes and products.
July 12, 2022
Subscribe to Supply Chain Management Review Magazine!
Subscribe today. Don’t Miss Out!
Get in-depth coverage from industry experts with proven techniques for cutting supply chain costs and case studies in supply chain best practices.
Start Your Subscription Today!
