Last week nearly 4000 supply chain professionals headed to Orlando, FL for the 2024 Gartner Supply Chain Symposium. In this blog, we share insights from the opening keynote delivered by Tom Enright, VP Analyst at Gartner.
Enright kicked off the session by highlighting the undeniable impact supply chains have on business operations, especially during times of crisis. He emphasized that supply chains play a crucial role in delivering value, particularly when faced with uncertainty and disruption.
For years, external forces have dictated the direction of supply chain organizations. Enright challenged leaders to envision a future where supply chain can control its destiny and drive innovation within the business. Gartner terms this state as ‘Drive.’
The analyst outlined four key areas where supply chain leaders can focus their efforts to achieve ‘Drive’:
1. Deliver Multi-Value Contributions
Supply chains must go beyond cost reduction and focus on delivering capabilities that drive overall business success. This involves defining priorities, building a versatile supply chain organization, and executing initiatives that create multiple forms of value.
2. Create Opportunity from Uncertainty
Uncertainty has become a constant in today's business environment. Enright shared that the acknowledgment of this reality “forces the reformation of the supply chain model, so that you can achieve competitive advantage despite the uncertainty of the uncertainty of the environment in which you operate.”
The speaker described three states of supply chain: fragile, resilient, and antifragile. A fragile supply chain suffers losses due to uncertainty, while a resilient one can withstand it. However, an antifragile supply chain goes beyond resilience by enduring uncertainty, while thriving and creating opportunities in the face of disruption.
To thrive in an uncertain environment, it’s important to consider these strategies:
Leveraging Decision Processes and Collaboration: Organizations must foster collaboration and leverage decision processes that allow for agility and flexibility in response to uncertainty. This involves breaking down silos and encouraging cross-functional collaboration to make informed decisions quickly.
Enhancing Management of Uncertainty through Experimentation: Operating the supply chain with a high degree of experimentation allows organizations to test and adapt to changing conditions rapidly. By embracing experimentation, companies can uncover new opportunities and mitigate risks more effectively.
Changing the Perception of Supply Chain Redundancy: Instead of viewing it as a cost, it should be seen as an investment opportunity.
Enright highlighted leading organizations have successfully embraced antifragility principles to thrive amid variability. These companies have implemented probabilistic planning and leveraged digital supply chain twins to anticipate the impact of ongoing uncertainty. By bringing uncertainty into their decision-making processes, they have been able to shift from plan-based to experiment-based decisions, ultimately outperforming their competitors.
To create opportunities for uncertainty, companies must focus on delivering the capabilities to shift production, supply, and operations; diversifying skills and capabilities; and creating a collaborative risk-management culture.
3. Design Simplicity
Business transformation requires deliberate efforts to reduce complexity. Enright advocated for a user-based approach to transformation, focusing on simplicity and clarity.
‘Designed simplicity’ was highlighted here as a methodology to help reduce complexity. This user-experience based approach to business transformation seeks to reduce complexity by being deliberate and intentional, prioritizing user experience, and eliminating business process ambiguity – making processes easy to understand and execute.
4. Unlock the Value of People with AI
Enright discussed the role of artificial intelligence (AI) and generative AI (GenAI) in augmenting human capabilities within supply chains.
It’s crucial to understand what exactly GenAI is and what it is not. As Enright notes, traditional AI is largely used for analysis and automation, including forecasting, classification and clustering, process optimization based on recommendations or automation. On the other hand, GenAI is a subset of AI, but rather than identifying and predicting patterns, it creates new artifacts at scale that preserve a likeness to the original data – this includes items such as video, language and text.
The successful adoption of both AI and GenAI requires understanding and trust. Organizations on ‘Drive’ recognize that trust is built by establishing clear and compelling use cases, equipping teams with the tools and training to build trust and create success, and monitoring limitations and user anxieties.
The session concluded with Enright urging the audience to reflect:
“You have to determine what the future of supply chain is going to be. Earlier, I presented this as a choice, but it’s not. (…) Think about the future, where you move to ‘Drive’. A future where the supply chain delivers multiple forms of value to the business, a future where antifragility turns uncertainty and disruption into value creation, a future where design simplicity unleashes transformation programs that are more successful, and a future where people partner with AI and generative AI, accelerate and innovate value creation. Your future has yet to be written, and you hold the pen.”
Master Uncertainty with Probabilistic Planning
At John Galt Solutions, we’re introducing a unique end-to-end AI-powered probabilistic planning approach to empower companies like yours to transform their supply chains by managing and creating value from uncertainty and variability.
Our Atlas Planning Platform provides a comprehensive supply chain planning solution that integrates advanced AI capabilities to augment human decision-making and elevate supply chain performance, enabling organizations to capitalize on uncertainty and drive profitable growth.
Let’s take a look at how we can help you embrace AI-driven supply chain planning technology to unlock the full potential of your supply chain.
