Delivering the perfect order with supply chain automation

Thomas Lai, Vice President and General Manager of Asia Pacific and Japan, Boomi

The cardinal rule of supply chain management is ‘expect the unexpected’. The convulsions that have swept supply chains in recent years have only emphasised this notion. So high are the stakes that research by TMX Global estimates supply chain disruptions could cost Malaysia close to RM9 billion annually.

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When it involves food, that amount doesn’t even take into account how it could impact the nation’s food security and cost of living as well as socioeconomic pressures. 

Clearly, supply chain resiliency is a matter of national importance, and companies are embracing technology to overcome the risks they face. However, a haphazard approach to digitalisation will only exacerbate the problem. The New Industrial Master Plan 2030 was developed to shape a more robust manufacturing sector with the use of data to enable Malaysia to be more competitive.

The key to unlocking supply chain resiliency is to be forward-looking and enable effective management of ever-growing volumes of data. Unfortunately, manual processes still plague supply chains. Here’s where automation comes in: acting as a means to streamline supply chain processes and power business agility. 

No place for legacy processes

Despite the emphasis on modernisation in recent years, time-consuming, manual processes are still a fixture for many businesses. Take spreadsheets as an example; the average organisation relies on this old workhorse for at least one mission-critical process. Although they are easy to work on, spreadsheets are notoriously susceptible to human error, which makes depending on them unwise. Manual processes also create or entrench silos, obscuring real-time visibility and ultimately hindering collaboration.

Automating data collection and monitoring can eliminate errors with the added benefit of providing a comprehensive view of consolidated data that leads to more accurate and timely decision-making, boosting supply chain resilience. Companies are able to anticipate and proactively manage bottlenecks, rather than belatedly react to them.

To be at the leading edge, Malaysian businesses must also champion sustainable supply chains. The emphasis on creating business ecosystems that are carbon footprint conscious will be a significant game changer, positioning those who stay ahead of regulatory compliance with enhanced brand reputations. By helping them leverage data, automation can empower Malaysian businesses to select routes that optimise energy use and reduce waste. These organisations will not only demonstrate their seriousness in protecting our planet, they will also be a force for positive change by motivating their partners – and competitors, as well – to combat climate change.

Workers, too, benefit from automation as it frees them from repetitive and tedious tasks. This allows them to focus on more strategic, value-adding activities. Additionally, organisations can also leverage automation to manage labour shortages, as well as maintain operational efficiency and output levels to bolster supply chain resilience.

How can organisations effectively adopt AI?

Organisations need to ensure that they have the right infrastructure, people and procedures in place to seamlessly integrate AI into core business operations. AI readiness includes preparing processes for AI adoption and assessing existing manual processes, particularly in industries related to the supply chain. This entails outlining workflows, identifying inefficiencies, and discovering opportunities for automation and AI to drive substantial improvements. It is essential to engage key stakeholders, ensure everyone comprehends the significance of this initiative, and be prepared to initiate the initial steps towards change.

When organisations grasp the nature of manual processes, they can lay the groundwork for automation. This might involve utilising software or hardware systems to carry out tasks that formerly relied on human involvement, ultimately enhancing efficiency and reducing human errors.

Automation in action

While automation is tipped to revolutionise supply chain management, visualising it in action can be difficult, particularly if the business still depends on traditional supply chain management solutions. These eight key areas demonstrate how automation will transform supply chains:

1. Frictionless acquisitions: Automation can free up data and connect systems to speed up the onboarding of newly acquired business units.

2. Preserving data quality: Automated workflows can apply predefined rules and procedures to help ensure data quality is consistent across the enterprise.

3. Keeping assets in view: Data-driven decision-making rests on real-time asset monitoring. Automation can deliver instantaneous status updates and data collection by connecting people, tools, and equipment to enhance operational efficiency.

4. Advanced predictive analytics: Automation tools can extract, process, and analyse large volumes of data and feed them to machine learning models. This can be leveraged to anticipate issues before they escalate as well as predict trends.

5. Unifying IT: Automation can break down silos between ERP, PLM, MES, and CRM systems to facilitate integration, fostering more efficient operations, minimising errors, and delivering more accurate insights.

6. Enabling scheduling and forecasting: Automation enhances data collection, integration, and analysis – which provides a comprehensive picture that enables accurate scheduling and demand forecasting.

7. Pre-empting misplacements and overstocking: By connecting disparate applications, automation enhances the transparent tracking of parts and products, reducing the potential for inventory mismanagement.

8. Enriching collaboration: Automation helps organisations streamline communications. This can be used to work more effectively with supply chain partners to elevate supply chain efficiency.

Supply Chain Visibility

However, automation for the sake of it will only derail end-to-end supply chain visibility and add to technical debt. To get the most out of automation, organisations must first conduct a comprehensive supply chain audit to identify choke points and areas that can be streamlined by doing away with manual processes. The progress of automation should also be measurable goals and regularly assessed for effectiveness to ensure returns on investments, and to guide future IT implementation strategies. 

With eighty percent of manufacturing decision-makers reporting a major supply chain disruption in the last 12 to 18 months, resilience and agility are more vital than ever. Not only that, but experience from recent years should also serve as warnings that supply chain disruption is only becoming more frequent and potentially more volatile, too. To be fully aware of this and still take a wait-and-see approach to automation would be the epitome of business folly.

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