Digital Supply Chain · 2018-08-16 · Headline Verdana Bold Digital Supply Chain Sandeep Chatterjee 1st August, 2018

Headline Verdana Bold

Digital Supply ChainSandeep Chatterjee 1st August, 2018

Digital Supply Chain© 2016 Deloitte Touche Tohmatsu India LLP 2

The views expressed are personal

and not necessarily that of Deloitte


Contents

▪ Introduction

▪ Supply Chain Redefined

▪ Disruption and Digitization

▪ IoT/Mobility

▪ Real Life

Make in India: Reinventing India’s Supply Chain© 2016 Deloitte Touche Tohmatsu India LLP

Introduction


• Sellers Market

• Predictable Sales

• Stable Demand

• Limited Competition

• Limited Product Range

• Simple Products

• Long Product Life Cycles

• Long Lead TimesSmooth

Sailing

The Business World in 1980


• Volatile

• Uncertain

• Complex

• Ambiguous

• Fast Paced Buyers Market

• Tough Competition

• Extensive Product Range

• Shorter Product Life CyclesNavigation of

Turbulent Rapids

It is a VUCA World in 2017

Make in India: Reinventing India’s Supply Chain© 2016 Deloitte Touche Tohmatsu India LLP

Supply Chain Redefined


Products move downstream

Information moves upstream

Supplier Producer Distributor Customer

Traditional View of a Supply Chain


Source: Unilever Website

The Real World is far more Complex


Complex and Volatile is the “New Normal”


Source: Aberdeen Group Supply Chain Visibility 2013

The Demand Network is enabled by Information Technology

Copyright © 2016 Deloitte Development LLC. All rights reserved.

Disruption and Digitization

How will Digital Supply Networks support clients’ business strategy in a digital world?

Copyright © 2016 Deloitte Development LLC. All rights reserved. 13

The rise of exponential technologies has created a burning platform: disrupt or be disrupted

Exponential Technology Change……Disrupting Supply Chains

Across All Industries

1992

$1,245 per Gbps

<$10

Bandwidth

$222 per million transistors

<$0.06

Computing

<$0.01

$569 per GB

Storage

Co

st

of

Perfo

rm

an

ce

Today

Source: Deloitte University Press


Disruption within the supply chain is driving better integration across platforms, transforming industries and changing consumer expectations

A consumer products

company is able to

reroute distribution

vehicles in real-time

based on unforeseen

events (e.g., stock-

outs, increased

demand, product

recalls)

Dynamic /Predictive Routing

Workforce Enablement

A large global retailer

analyzes social media

chatter to optimize

local inventory

assortment and

enhance inventory

planning (e.g., a spike

in social media activity

about an upcoming

phone launch helps

buyers improve their

purchasing decisions)

Social Media Analytics

A beer brewing

company leveraged

advanced

optimization and

scenario analysis to

better understand

the cost impacts on

supplies (e.g.,

glass), enabling

more informed

sourcing decisions

Strategic Sourcing

A leading pharma

company introduced a

global Real World

Evidence (RWE) platform

to collect clinical and

patient data from

hospitals and third

parties. This enabled the

company’s R&D and sales

functions to better

understand the patient

outcome sales dynamics

Real World Evidence

DeliverMakeSourcePlanDevelop Support

Life sciences

companies are using

AR software to give

lab technicians visual

instructions to

perform

maintenance tasks,

improving machine

uptime and reducing

emergency service

calls

AugmentedReality

A high-tech

semiconductor

manufacturing

company uses Smart

Glasses to remotely

support off-shore

manufacturing and

assembly through

on-demand

knowledge sharing

Digital Supply Networks Thinking


A new phase of Digital Supply Networks management has arrived: Machines are augmenting human performance

Power Generation

Industrialization

Electric Automation

Late 18th century

Start of the 20th century

1970s to 2000s

Steam engines and hydraulic power drive improved

productivity and enabled industrialization

Advances in computing and the internet allow for

information to be captured and transferred more quickly than

ever before

Electricity and assembly lines paved the way for mass

manufacturing, improved infrastructure, and advances

in financing and credit markets

Execution of connected products, customers, and

supply chain and operations -driven by a vast network of cyber-

physical systems

Optimize Traditional Objectives…

Cost Innovation Service

Quality Safety Flexibility

4th Industrial Revolution

Digital Supply Networks

…By Better Managing

Visibility Variability

Volume Velocity

…and New Objectives…

Revenue


Companies must choose priority initiatives to configure their supply chains to meet competitive objectives

Sensor/Data-driven Design Enhancements

Data as a Product or Service

Analytics-driven Demand Sensing

Proactive Quality Sensing

Analytics-driven Sourcing

Augmented Reality-enhanced

Operations

AugmentedReality-enhanced

Logistics

Inventory-driven Dynamic Pricing

Augmented Reality-enabled

Customer Support

Open Innovation / Crowdsourcing

Make-to-Use with 3D Printing

DynamicInventory Fulfillment

Track-and-TraceSolutions

Asset Sharing Automated Production

Automated Logistics

Sensor-driven Replenishment

Pushes

End-to-end Transparency to

Customers

Rapid Prototyping

Ultra-delayedDifferentiation

POS-driven Auto-replenishment

Proactive Risk Sensing

Blockchain-enabled

Transparency

Predictive Maintenance

Direct to User Delivery

TargetedMarketing

Make-to-Use with 3D printing

Virtual Design Simulation

Real-timeInventory

Optimization

Cloud/Control Tower

Optimization

Sensor-enabled Labor Monitoring

Driverless Trucks Predictive Aftermarket Maintenance

Sensor-driven Forecasting

Supplier Ecosystem

Dynamic / Predictive Routing

Aftermarket

Sales &

Services

Sales

Optimization

Logistics

Optimization

Operations

Efficiency

Supplier

Collaboration

Risk

Prevention &

Mitigation

Planning &

Inventory

Efficiency

Product

Optimization

Design

Process

Optimization

Sample Tactics

Supply Chain

Transformations


The flows of information and movement between the digital and physical worlds are made possible by employing several integrated DSN technologies or capabilities

Additive

Mfg &

Advanced

Materials

Robotics &

Autonomous

Vehicles

Augmented

/ Virtual

Reality

Intelligent

Workflow

Automation

Digital

Scanning

Cyber

Tracking

and Profiling

Cellular,

Satellite &

Wi-Fi

Comms

Signal

Ingestion

and Cloud

Edge

Computing

OT Security IT Security

Machine

Controls

Visualization

, UX and

Mobile

Sensors

and

Wearable

Technology

Data Science &

Algorithms

Machine Learning

Deep Learning &

AI

Natural Language

Processing

Video & Spatial

Analytics

Physical Digital

Signal

Transformation

(Processing)


IoT/Mobility for Supply Chain Visibility


PEOPLE ANALYTICS

Physical devices and objects intelligently connected

Delivery of the right information to the right place at the right time

Connection of people in more relevant and valuable ways

Internet of Things

The Internet of Everything combines things, processes andpeople with relevant

data

THINGS

PROCESS

Individual data streams are processed and analyzed with algorithms

Internet of Things (IoT) refers to a world of connected objects generating data and providing insights for use in new services


The Internet of Things offers a potential economic impact of $4 trillion to $11 trillion a year in 2025

Business imperative

Source: McKinsey Global Institute analysis

Factories—e.g., operations management, predictive maintenance

Cities—e.g., public safety and health, traffic control, resource management

Human—e.g., monitoring and managing illness, improving wellness

Retail—e.g., self-checkout, layout optimization, smart customer-relationship management

Outside—e.g., logistics routing, autonomous (self-driving) vehicles, navigation

Work sites—e.g., operations management, equipment maintenance, health and safety

Vehicles—e.g., condition-based maintenance, reduced insurance

Homes—e.g., energy management, safety and security, chore automation

Offices—e.g., organizational redesign and worker monitoring, augmented reality for training

Nine settings where value may accrue Size in 2025, $ trillion

1.2-3.7

0.9-1.7

0.2-1.6

0.4-1.2

0.6-0.9

0.2-0.9

0.2-0.7

0.2-0.3

0.1-0.2

Deloitte Digital Copyright © 2016 Deloitte Digital LLP. All rights reserved.

HOW EXACTLY DOES IOT WORK?The Internet of Things (IoT) is a world of intelligent, connected devices that generate data companies can use to transform business. Sensor networks feed data models which can then be analyzed to reveal hidden insights that inform decisions and actions.

S E N S O R S D E V I C E S N E T W O R K S P L A T F O R M D A T A A P P L I C A T I O N S & A N A L Y T I C S

B U S I N E S S P R O C E S S & B U S I N E S S M O D E L I N N O V A T I O N

End to End IoT Solutions


The cold chain is a concept that necessitates maintaining strict control over the temperature and tolerances of pharmaceutical product through out a supply chain including logistics, distribution, manufacture, storage and transportation prior to final use by the patient without deterioration.

Regulations

Health

Canada

Internation

al Safe

Transit

Association

FDA – CFR

205, CFR

211

EMA

Parenteral

Drug

Association

– Technical

Report No39

Cold chain logistics costs are growing by 5% YoY20 of the 50 Top Selling Drugs need 2-8°C cooling1

1 Source: Cold Chain BioPharma Logistics Sourcebook 2013; Monitor Deloitte Expert Interviews; lifeconex-

lcx.com

2 Note: Synthetic drug

2 5,002

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

Global Sales 2012 (mn)

Series1

Pharmaceutical Cold Chain


Note: This visual applies to the common value chain, the clinical trial value chain adds even more complexity as more information needs to be captured and regulations are

even stricter

Lack of connectivity limits ability to effectively monitor environmental parameters

The Cold chain – Process Overview

Raw material suppliers/ sourcing

Refrigerated transport

Manufacturing and packaging

Cold storage warehouse



Cold storage warehouse

Healthcare facilities

Investigations & root cause analysis cost companies billions

Cost of each root cause

investigation$6K

Excursion

Excursion

Excursion

Temperature monitors couriered back for reading data. Material released after data is

read


Time to investigate excursion 4-6 weeksManual temperature

recording

Manual temperature

recording

Manual temperature

recording


Opportunities for service providers

Temperature monitoring as a service

Real time notificationsThe system can send real time notifications to the transport company if a temperature excursion is detected. This will provide the transport provider to take immediate corrective actions where possible

RCA Analysis Regulatory queries on temperature monitoring can be supported through the highly available data The data can also support RCA and investigation after the fact processes if any excursions are experienced. Temperature sensors can be augmented with light, motion and location sensors to further enhance the RCA process and enable continuous improvement.

Data TransparencyThe solution enables adding temperature monitor at a pallet level and is tied back to the delivery. If an excursion is experienced at any point in the shipping process appropriate notifications can be triggered to the QA personnel.

Receiveorders

AddTemperaturesensor

Pickpack

OutboundLogistics as a service

Shipping as a service

Monitoring and data

integration as a

service

Notify QA

QuarantineMaterial

Engage customerservice

Investigateclaim

Processrefund

Sensors as a service

End Client Service Provider


“Certificate of compliance to be provided to customer with environmental parameters

History maintained for the delivered material, batch and the pallet”

Quality certificate compliance

Quality certificate


Shipment Carrier Registration

Number/Storage Area for

malfunction

Specifications infringed for

notification creation

Shipment number for the

delivery carrier having

malfunction

Parameter/Sensor having

the malfunction

− Notifications and alerts triggered based on out of specification (OOS) recordings for environmental parameters

− Customizable behavior of OOS alert and notification parameters

◦ Alerts – for every OOS create an alert

◦ Notification – for three OOS create a notification with action items

Real time notifications and alerts

Alerts notifications


Equipment maintaining parameters (Refrigerators, humidity controllers) can be tracked and maintained—

− Preventive and predictive maintenance

− Notifications and alerts converted to Breakdown Maintenance Orders

− Equipment history and health monitoring

Tracking equipment health

Predictive maintenance


Detailed storage bin level material health—In warehouse

Smart business Fiori apps

− Overall summary in warehouse with material health as per environmental parameters (temp, humidity, light)

− Drill down to storage bin level tracking

− Relevant action items as per the out of specification (OOS) observations

0

5

10

15

20

25

30

Initiate Quality

____________

Initiate Maintenance

Cancel Pickup

____________

Initiate Quality Check


• Criteria to classify a delivery as failed or successful is configurable

.

Failed delivery analysis by third party logistics partners

Analytical reports

− Executive Dashboard for Failure on Delivery by Third Party Logistic partners

− Identification of vendors with highest failure rates

− Failed deliveries due to non compliance of environmental parameters during storage or transportation

− Relevant action Items as per the out of specification (OOS) observations

− Further analysis: Drill down to individual deliveries, routes and notifications/orders created for resolution


Customer

Material

Period

Third Party Logistic Vendor

Warehouse ID

Selection Criteria

− Executive Heat Map—Real time and post analysis for tracking region wise failed deliveries

− Relevant action Items

− Further Analysis: Drill down to customer, individual deliveries, materials and notifications/orders created

Region wise delivery failure heat map

Analytical Reports

Criteria to classify a delivery as failed or successful is configurable


OOS-1 ACTION


Current Status

Warehouse: Alarm

Fleet: OK

− Executive Dashboard for Real Time tracking and managing Warehouse and Fleet health

− Real time indicators for OOS Warehouses and Fleets

− Relevant Action Items as per the Out Of Specification (OOS) observations

− Further Analysis: Drill down to individual deliveries, routes and notifications/orders created for resolution

Real Time Warehouse and Fleet Health Monitor

Health monitor


− Executive Dashboard for Real time tracking of deliveries on the way

− Real time indicators for OOS warehouses and fleets

− Relevant Action Items as per the out of specification (OOS) observations

− Further Analysis: Drill down to individual deliveries, routes and notifications/orders created for resolution

Real time delivery tracking dashboard

Health monitor

Customer

Material

Period

Third Party Logistic Vendor

Warehouse ID

Selection Criteria

Notification/Message

Alerts


− Executive dashboard for customer level analysis

− Failed deliveries due to non compliance of environmental parameters during storage or transportation

− Relevant action Items as per the out of specification (OOS) observations

− Drill down to customer level for further analysis

Failed delivery analysis by customer

Analytical Reports

By delivery count By cost for failed deliveries



Real Life

What are some tactics that companies are employing to drive their business strategy through Digital Supply Networks?


Design Process Optimization: Sensor/Data-driven Design EnhancementsCaterpillar has a fleet of mining trucks that operate autonomously, 24 hours a day. The machines are embedded with sensors that transmit information on oil pressure, filters, and other truck components via wireless connections back to headquarters. When compiled over time and analyzed, the data can help engineers design heavy equipment that can accomplish more work with fewer passes - leading to reduced idle time, less operator fatigue, and lower fuel consumption

Impacted Supply Chain Areas

Differentiators

Speed Service

Agility Innovation Quality

Cost


Product Optimization: Make-to-Use with 3D PrintingThe commercial aerospace and defense industry is using 3D printing for concept modeling and prototyping, printing low-volume complex aerospace parts, and printing replacement parts. Potential future applications include printing aircraft wings and complex engine parts and printing repair parts on the battlefield, thus cutting out the traditional design, manufacturing, and distribution steps


Quality

Cost

Differentiators

Agility Innovation

Speed Service


Product Optimization: Ultra-delayed DifferentiationCoca-Cola’s Freestyle soda machine allows users to select from mixtures of flavors of Coca-Cola branded products which are then individually dispensed to create custom flavors. This “make-to-consume” model can replace slow-moving inventory on shelves, reduce distribution and logistic costs as water volumes in shipments are minimized, and enable integration with retailers

Quality

CostSpeed

Agility

Service

Innovation


Differentiators


Supplier Collaboration: Analytics-driven SourcingTesco uses predictive analytics and meteorological data to anticipate future consumer-buying needs by product and by store (e.g., people buy more ice cream on hot days) and work with suppliers to source those items quickly. This analysis saved them ~$140 million through reduction of wasted stock

Quality

Speed

Agility Innovation

Cost Service


Differentiators


Operations Efficiency: Augmented Reality-enhanced OperationsEasyJet uses augmented reality smart glasses to enable two-way communication between its network of remote maintenance technicians and the central engineering team. The streamed information provides an accurate view of the situation, and enhancements like QR code part scanning allow the software to automatically push relevant information. Step-by-step walkthroughs enable technicians to perform complex maintenance and reduce downtime, achieving an estimated $500,000/year in savings from fuel costs alone by eliminating travel for its central engineering team.

Quality

Speed Service

Agility

Cost

Innovation


Differentiators


Logistics Optimization: Automated LogisticsWalmart is developing drone technology to replace the jobs of inventory quality assurance employees and aims to cut inventory checks in all of their massive distribution centers from one month down to a single day. Walmart is collaborating with the Federal Aviation Administration on the autonomous quad-copter done (roughly 3 ft by 3 ft), which can take 30 images per second from a top-mounted camera. The camera is linked to a control center and scans for tracking number matches. Matches are registered as green, empty spaces as blue, and mismatches as red

Quality

Speed Service

Agility

Cost

Innovation


Differentiators


Sales Optimization: Sensor-driven Replenishment PushesConsumer product companies are using Amazon Dash to sense demand and drive replenishment sales at the precise point of consumption. By gaining visibility into customer usage patterns, Amazon can improve their demand forecast accuracy and plan for more economical and efficient transportation routes. Amazon Dash shortens CPG supply chains and places goods in the hands of their customers faster

Parent Brands & Categories using Amazon Dash

Nu

mb

er

of

Cate

go

rie

s

Number of Brands

1

1

2

2

>5

>5

Quality

Cost

Agility Innovation

Speed Service


Differentiators


Aftermarket Sales & Services: End-to-end Transparency to CustomersStonyfield has launched an interactive Source Map on their website to provide their customers with full supply chain transparency. Customers can view farmer profiles, see images of the actual farms, and view in-depth videos of ingredients like bananas and blueberries to better understand the source of their yogurt ingredients

CostSpeed

Agility Innovation Quality

Service


Differentiators


About DeloitteDeloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www.deloitte.com/about for a detailed description of DTTL and its member firms. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

Copyright © 2016 Deloitte Development LLC. All rights reserved.Member of Deloitte Touche Tohmatsu Limited

http://www.deloitte.com/about

http://www.deloitte.com/us/about

Documents

Digital Supply Chain · 2018-08-16 · Headline Verdana Bold Digital Supply Chain Sandeep Chatterjee 1st August, 2018