2021 Supply Chain Focus & Beyond - 3 Key Areas You Need to Focus On

okay so the topic this week is what about the future of supply chain what should we focus on next year in 2021 and beyond that now actually i gave a talk last night during an online conference that went for about you know 40 minutes or so what i thought i might do is just summarize one slide so the backdrop was you know all of the turmoil through 2020 we've had all this disruption in our supply chains um we're probably going to have a lot more disruption to come we've got you know trade wars we've got sourcing issues uh we've now got lots of different channels opening up as a result of people being used to ordering at home and you know demand is coming through in many different ways so all that stuff that we we know we've all experienced what have we learned from all of that and what should we focus on for 2021 so that is the topic and this particular little diagram i've split into three so the first area i think we've got to focus on is supply and demand and the particular aspects around that are one is service understand the service that your market now demands and you know omni channel was the great thing over the last few years it really is now and if you weren't uh providing an online service to your market you probably are now and you will into the future online sales have really peaked for a lot of businesses you know i've seen some businesses double the volume of online sales that is not going to suddenly drop back to pre-covered levels people have got used to actually ordering online people like me i don't know if i want to go to a store anymore everything gets delivered you know to home and i like it i like the convenience so think about the service offers that you've got for your for your customers for your clients and think about that you know going forwards which channels are going to be more popular we also need then to have a look at demand and the demand through those different channels and how that's growing the lumpiness of our demand the peaks and troughs in demand i mean jiha we've seen that through 2020. um hopefully that's going to flatten out a little bit but we've got to be much better at our demand planning our forecasting all of those elements going forward sourcing in terms of supply and demand sourcing is going to be one of the areas where it's going to be a bit of a shake-up uh right now here i'm in australia we've got a few challenges with sourcing out of china you know china's being very difficult about importing our products um already i think a lot of companies are looking at alternative sources of supply for different products um and i think that just makes common sense i think everybody around the world recognizes now that single country sourcing is not necessarily the way to go we need to have at least a secondary supplier somewhere else that we can kind of try out and make sure they're operating just in case so demand and supply three things to focus on service the actual demand and sourcing number two flexibility wow have we learned to be flexible during 2020 and i think we need to be flexible going forward to be honest it's been a very good lesson so what aspects of flexibility am i talking about assets for one think about assets such as warehousing in the past we would think nothing of you know throwing up new warehouses with huge capital investment in racking systems and conveyors and so on you know depending on the industry that you're in is that necessarily the way to go forward because you know markets might be changing demand profiles might be changing um we live in an ever-changing world now and and don't think that just because covet is almost over well kind of almost over by the time this video comes out hopefully you know there's going to be disruption in the future we've always had pandemics and wars and political disruption and economic disruption so i think this has really been a great lesson for us so flexibility in assets hey look at some of the new distribution centers going up here in australia we're seeing a lot more now going up with mobile storage systems uh you know like the sort of amazon concept where uh little robots or agvs will go out pick up the whole storage system bring it to the people they can pick what they want and it goes back again um you know how flexible is that with using robotics for picking you know if if the product profile changes if the demand profile changes um you know if you're getting peaks and troughs it's very easy to reconfigure all of that you just throw a few more machines in and very very flexible going forward not going to work for every kind of business of course but think about the sorts of assets that you have in your supply chain and are they going to be these fairly sort of static fixed assets or can you get a little bit more flexibility into them number two on flexibility will be channels i kind of touched on that from the customer point of view but you really need to understand what channels are going to be important to you in the future the demand going through those channels the costs associated with servicing those channels so much home delivery has gone on in 2020 i don't know how some companies manage it because home delivery is not cheap um it's probably one of you know the most expensive forms of delivery you think of the the cost of a truckload of product going into a supermarket versus that same truckload in little bags being delivered to you know 100 different homes it's way more expensive so really get a good handle on your channels what channels do people really want out of your business how are you going to structure those resource those and try to manage those cost effectively and then the third element of flexibility and i did go on a bit about this at the conference last night is really understanding your costs good cost visibility and if you know me at all you'll know what is my number one topic to talk about it's cost to serve that's what i mean in a changing supply chain environment you've really got to understand intimately the cost going through all your different channels with all your different products with all your different types of customers so that you can make sure that profitability is maintained through all of those um funnily enough at the beginning of this talk last night um i said to people you probably think this whole talk is going to be about ai and robots and digitization it's not remember all those things are enablers so great systems and digitization is really important but you've got to get these fundamentals right and one of those is understanding your true costs and your product and customer profitability you do need good systems to help you report that real time but it's a it's a basic skill i think in supply chain so what about number three we've had demand and supply we've had flexibility number three i reckon we shout about people um have we paid lip service to that over the years do you think oh our people are our greatest asset i tell you what in 2020 um we know they're our greatest asset if you look at some of the businesses around the world and what they had to do in terms of you know flexing and pivoting and changing how they work it was all down to people you know being willing people being innovative and people executing on on those really rapidly developing plans that's not going to change going into the future and if you look at the really the most successful supply chains they have fantastic people great culture and fantastic people so what are the three elements around people you think that we might need to focus on one is attracting the right people and don't just think you know where you're operating in the world think globally um it's very hard to actually attract good talent sometimes into supply chain it's not a very sexy industry but look at what 2020 has done for supply chain everybody now knows what supply chain is about you know eight months ago they all realized how toilet tissue gets supplied to them you know how milk gets supplied to them whatever and so supply chain got a real shot in the arm and a much higher profile this year which is great for the industry and hopefully now that's going to enable us to attract a lot more talent into the industry so let's try and make it you know collectively a really attractive industry for people to get into because it is and it's it's a great career we've got to attract people we've got to train them and again uh this conference last night it was interesting there was a poll going on and 100 of the participants and there were hundreds of people on this on this conference 100 of them said they're going to invest more in training during the next year that is so important it's all part of not just attracting and retaining talent but developing talent so that they can be more productive so they can add more value to the business and so that they can feel more fulfilled and and develop their careers as well so training is so important and think outside the box with training you know it's not necessarily degrees or formal training courses there are all kinds of different training available heck you know we've even got one on this channel i'll put a link down below it's an online training program which is dirt cheap so go and have a look at that so training is really important and then the third element attract train retain how are you going to retain your people because supply chain talent is so important in our businesses these days the people who can be innovative creative and problem solved that's that's really what we've seen i think this year that supply chain managers have been great problem solvers you know it's probably that engineering sort of thinking that we have you know this is how we do it always in the past suddenly that's all gone we've got to find a different way to do it so think of ways that you can retain that talent and develop them and keep them going in your business you know for a long long time into the future so kind of that was a quick summary of a 30-minute talk last night i thought the things going forward to really focus on uh demanding supply flexibility and people and where is automation and digitization in all of that it's a really solid enabler um you know it's not the solution it's the enabler and i think that that's really powerful um i did mention a couple of things in the talk last night that whilst supply chains during the covet period i had have been a bit of a challenge i think we've got a couple of other challenges coming up um and i i want to just briefly mention climate change which is having a a bigger impact on businesses every year passes and and it's incumbent on us now i think to start thinking about you know not just reverse logistics and recycling but circularity in our supply chain is so important uh have a look around the channel there's a couple of great videos with um sherry hainish and deborah dull talking about circularity and sustainability our markets are going to demand that much more of us going forward you know it's no longer just about wanting to have fair trade coffee and things like that i think our markets are going to be much more discerning going forward and we want to know you know how much of this is made from recycled materials um you know what um what heavy metals are in this that got dug out of the ground by children in central africa you know those sorts of things people really want to know what's going into the products um and and how can we recycle these products and actually get them coming back through the supply chain again so i think that's where we've got some really good challenges coming up in our supply chains so there we go just a quick run-through of some things to think about in 2021 and beyond uh it's a great time to be in supply chain i think i hope you think so as well so thanks for watching see you next week if you're new to the channel um i'll just let you know that if you hit subscribe and the bell next to subscribe you'll get notified every time we have a new video coming out a bit of a tip they come out every tuesday evening at sydney australia time so thanks for watching lots of comments down below questions always love to see that and we'll see you next week bye for now [Music] [Music] you

Channel: Supply Chain Secrets

Views: 10,628

Rating: 4.9712229 out of 5

Keywords: Supply chain, supply chain secrets, supply chain management, supply chain logistics, rob obyrne, supply chain education, tips on supply chain, supply chain 2020 trends, supply chain problems 2020, supply chain 2021 trends, supply chain focus areas, future supply chain management, supply chain strategy, logistics future trends, logistics trends 2020, logistics 2021, supply chain alignment, supply chain consultant

Id: YyT3_SuNA9c

Length: 12min 38sec (758 seconds)

Published: Mon Dec 28 2020