Did you know that 74% of planners deviate from standard processes to respond to disruptions? This is a strong indicator that traditional processes we have relied on for years are no longer suitable for today’s rapidly changing environment.
As supply chains grow more dynamic and complex, it becomes more difficult – and more important - to connect, align, and synchronize processes within and across business functions and domains. For many supply chains, lack of visibility into the relevant data and in the right context means people making decisions across the network often deviate from established processes to get the job done.
According to Gartner, right now just 10% of global decision makers have the required process adherence, data-derived models and trade-off clarity required to leverage their digital technology investments to improve decision-making. “On average, decision makers estimate that staff deviate from defined processes ~30% to 40% of the time and only ~41% to 50% of relevant processes are fully digitized, both of which contribute to poor tradeoff clarity.” (Gartner, Leverage Human Visibility and Digital Analytics for Better Decision Making, September 2023).
Process Orchestration to Align Cross-functional Decisions
Process orchestration is a key enabler in changing this. It’s about connecting silos of insight and developing connected processes that link decisions across functions and domains. The aim is to make the right actions and decisions happen in the right place at the right time.
For example, in the order-to-cash process, visibility into events that happen along the way, such as a transportation disruption or materials shortage, drive better decisions for every function that supports that process; alert the customer, switch suppliers, shift the production schedule, and so on. When all parties to that process can see and coordinate activities in a larger context, they make better decisions with better outcomes.
To achieve process orchestration, organizations need key building blocks in place, including well-governed, clean and centralized data and broad visibility into that data. As companies advance in their process orchestration, they move from a focus on enabling local, siloed functional decisions to supporting three incremental levels of supply chain maturity:
- Cross-functional integration: When supply chain activities are integrated and coordinated across their internal supply chain operations and functions, such as planning and manufacturing.
- External Collaboration: As organizations move up the maturity curve, this extends to other functions across the organization, such as finance, sales, and marketing, as well as close external partners like first-tier suppliers, and for some, customers
- Ecosystem Orchestration: At the most mature level, visibility and processes can be orchestrated across the broad end-to-end supply chain, including suppliers across tiers and other stakeholders outside the four walls who play a role.
Enabling Supply Chain Planning Software Technology
In addition to requiring the right support, processes must also be flexible to reflect changing requirements. Processes that shift with the needs of their users are much more likely to be adhered to, rather than worked around. For example, in the disrupted order-to-cash process above, a new supplier may spur the creation of a new process to adjust to the change.
Today’s more modular, composable supply chain planning software enables flexible processes by allowing users to design, build, and innovate faster than ever before, and by adapting to change at the speed of business. Capabilities are designed and deployed by quickly adopting policies and actions, leveraging the right data. Today, we often see digital supply chain twins help facilitate this level of orchestration.
The Role of Process Orchestration to Enable Intelligent Decision-Making
Process orchestration is one of the essential pillars, or levers, of next-gen supply chain planning. It is key to enable organizations to align operations across departments and supply chain functions so that all users can collaborate and share information faster, leveraging digital insights. As business complexity increases, decision making must be quicker, more responsive and more resilient, taking an ever-changing context into account – and this is where the role of process orchestration can help companies outperform and outdeliver.
Amid these levels of increasing complexity, probabilistic planning is gaining momentum as a forward-thinking approach that takes a very different view of risk, uncertainty, and disruption and acknowledges the inevitable variability in demand and supply, as well as disruptions. Instead of a “perfect” plan, planning systems generate a range of possible outcomes, so planners can choose the best course for a given set of conditions, goals, and tolerance for risk. By understanding and accounting for varied levels of uncertainty in a range of proposed plans, planners can make informed decisions that can help them unlock new business value.
At John Galt Solutions, we view process orchestration as an important component in the future of supply chain planning. With our unique end-to-end AI-powered probabilistic planning approach, we work with companies like yours to embed the essential building blocks of process orchestration and the other key pillars across our market-leading Atlas Planning Platform, helping you evolve and orchestrate your entire supply chain ecosystem.
You can read more about that transformation in our white paper: The Future of Supply Chain Planning: Going Beyond AI.
