By now we all recognize that we live in a connected world, at least in our personal lives. Some leading companies have embraced this connectivity to drive efficiencies in their supply chains.

A recent white paper from Transportation Intelligence and Kewill makes the case for adopting new technologies by manufacturing supply chains.

Manufacturing paradigms have been shifting in recent years, as have their supply chains. “Vertically integrated production plants with raw materials coming in one end and finished products emerging from the other have all but disappeared in many industries,” the paper noted. “Evolution to outsourced, very flexible, ‘manufacturing on demand’ models is now taking place on a large scale.”

The paper makes the case for viewing supply chains as ecosystems and for creating flexible networks that emulate the kinds biological systems found in nature.

The simple definition of an ecosystem is a “biological community of interacting organisms and their physical environment.” The parallel to manufacturing supply chains is that “companies are looking for networked solutions that exhibit similar characteristics to the ecosystems that have evolved in the natural world. These natural systems have evolved to be both resilient and enduring.”

Legacy systems were designed to perform a defined set of functions with limited ability to interact with their cohorts. The white paper makes the case that what is required in today’s business environment is an ecosystem characterized by connectivity and flexibility.

“As these systems come together to form networks,” the paper noted, “they begin to resemble other connected systems, especially those biological ones found in nature.”

The platform that can make all this happen, not surprisingly, is the cloud. Cloud technologies facilitate the seamless exchange of relevant data with the system s that need them. “Instead of looking into a variety of different systems for information,” the paper asserted, “these new systems will always have a single version of the truth.”

Cloud services may be ideal for the logistics industry, the white paper argued. “Global trade thrives on fast, transparent communications,” the paper noted. The flexibility of the cloud frees companies “from the burden of continuous maintenance and upgrades, allowing them to focus on creating the best solutions for their customers.”

The cloud infrastructure also address the challenge of integrating with new partners. Logistics and supply chain management require a constant exchange of data with partners. Connecting legacy systems is expensive and burdensome. Cloud solutions alleviates these issues with libraries of

interfaces and the increased standardization that is being applied to connectivity.

“Achieving this is not a trivial task, however,” the paper noted. “The best approach is to start small and agree some basic rules on data definitions, before attempting some more ambitious goals.”
Related to the cloud platform is the growing phenomenon of the Internet of Things. As the proliferation of data from devices provides a real-time picture of operations, supply chain solutions that support the explosion in devices and sensors will have a significant advantage over those that can’t.

To achieve the desired insight from the tsunami of data requires the application of data analytics. “Supply chain managers need systems that can absorb and understand huge amounts of data, but only highlight what is necessary and relevant to maintain operational performance,” the paper concluded. “This requirement is why any solution should be a platform rather than discrete functional system. Indeed, as a platform it should make it easier for all of the parties involved in the network to embrace and interact with it as the ecosystem evolves.”