The supply chain industry like most other industries saw major disruptions due to the effects of the COVID-19 pandemic, which led to an acceleration in the adoption of technology in recent months. Be it automation with the use of cloud, AI and robotics, IoT or even blockchain, companies had to ensure that their business remains competitive to meet customer demands. At the same time in order to navigate growth in today’s uncertain business climate, cost reduction has become one of the top most priority for organizations. A recent Deloitte survey found that two-thirds of companies expect to pursue cost reduction strategies over the next 12 months.
In a recent conversation with CXOToday, Kaushik Mitra, Senior Director, Cloud ERP at Oracle, explains how organizations, especially those dealing in supply chain must successfully prepare for the post-pandemic recovery. He also sheds light on some of the recent initiatives from Oracle to support the post-pandemic recovery of enterprises from the supply chain side.
What are some of the areas organizations must focus on while they prepare for post-pandemic recovery?
Our economy as a whole has gone through tremendous stress over the last 18 months and after contractions, the Indian economy is now on the path of recovery as the government ramped up the vaccination drive. On the business front, there are organizations who’re yet to start their digital journey and are slowly preparing to open up as cases decline and on the other hand there are some who are driving their businesses by approaching digital operating models e.g. IoT and predictive analytics including hybrid working structure and by employing trusted strategies to future-proof their business.
Organizations must remember the lessons learned from the lockdowns, particularly regarding the supply chains. Their focus now must be to make sure that all internal, as well as external business processes, are streamlined and robust. On top of this, there should be collaboration and planning which needs to be aligned to the business goals which means that integrating corporate business planning with sales and operations planning should be integrated. Also, keeping in mind that the threat of a third wave is still looming upon us and therefore the sole focus of organizations must be on the intricacies of their operations including supply chain management, human resource operations, financial operations, customer services, and many more.
The pandemic highlighted some of the structural issues with our supply chains. How can businesses deal with such nuances?
The most important step organizations can take to ensure their supply chains are fundamentally strong is through adoption of new-age technologies. There are multiple complex issues pertaining to transportation and logistics, warehousing and storage, and administrative processes which also includes procurement and that until now required complete human intervention to operate. However, with the advent of emerging technologies, these processes can be completely automated. Not only will that help organizations survive in the future with further lockdowns but also reduce other bottleneck issues as well and at the same time reduce human error. The focus is now on adaptability, speed, risk reduction, and sustainability whilst adopting more flexible sourcing and distribution strategies as regionalization has become a trend. In the long run, the adoption of cloud technology will help in reducing various fixed and variable costs and the key enabler for supply chains to become viable is seen in the digital transformation. For instance, Oracle SCM, a cloud data-driven platform is assisting customers to reduce transportation costs by 20%, tripled order fulfillment speed, and achieved a 96% delivery satisfaction rating. Additionally, it is easily accessible and user-friendly for all stakeholders involved in the supply chain thus creating shockproof supply and delivery processes.
How can technology be utilized by consumers and suppliers to reduce costs and subsequently increase savings at both the demand and supply side?
The role of supply and demand are equally important for economic growth and now when the Indian economy is moving towards recovery it is even more important to make sure that both are in equilibrium. In this context, technology essentially serves as a platform for both consumers and suppliers. For suppliers, using AI and ML-driven solutions can help attain operational efficiency and future proof them. This is extremely important for post-pandemic recovery as businesses have suffered extensive losses in the past year and some were even forced to shut down and therefore at this point cost-cutting remains the topmost priority for almost all businesses. When it comes to procurement, back office solutions and functionalities supports purchasing alone but they are no longer enough and therefore businesses need latest procurement analytics solution that enables CPO’s to more fully understand external risk factors and internal capabilities, allowing organizations to pivot when needed. A robust supply chain software application is all that businesses need to address the changing requirements for such challenging times, bring down costs while simultaneously keeping good profit margins thus promoting savings on the customer of demand end as well and this will ultimately help in preparing a company for the future.
Can you briefly tell us about some of the initiatives and solutions Oracle has come up with to support the post-pandemic recovery of businesses dealing in supply chain.
Oracle has build its credibility in the market with their broadest range of solutions and our comprehensive Oracle Cloud SCM platform, Oracle Fusion Cloud Supply Chain & Manufacturing. It helps organizations build resilient and agile supply chains that drive innovation and growth. This is Oracle’s 6th consecutive year of being positioned as a Leader in 2021 Gartner Magic Quadrant for Warehouse Management Systems.
Recently, we’ve updated our Oracle Fusion Cloud Procurement, part of our SCM and ERP solutions to understand the market dynamics and support businesses who are struggling to manage cost and make them future ready in the post-pandemic phase. This is a multi-dimensional solution, designed to assist customers in reducing risk, lowering costs, enforcing compliance, and simplifying supplier management and contracting. It essentially gives an overview of all procurement and supply processes across all verticals of organizations coupled with spending analytics using which managers can recognize the areas where they can reduce costs promote savings.
With regards to future risks and to drive business agility and resilience we have also introduced DataFox Supplier Intelligence, a predictive intelligence tool within the same portfolio that provides data insights generated from the AI and ML integrated within the system to help avoid any future shocks. Similarly, we have other new enhancements like Supplier Qualification Management and Project-Driven Supply Chain, these solutions are especially beneficial for manufacturing industries for end-to-end planning, execution, and visibility that assists customers in controlling project risk. In conclusion, our intention with these latest enhancements is to provide full visibility and transparency to our customers to maximize cost savings while ensuring continuous operations.