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As Supply chains have benefitted from Global inter-connectedness and become networks (of systems) how can they demonstrate the robustness that was inherent in Supply chains of the last century?
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Ontonix UK LtdGlobal “Supply chain” perspective
& Complexity solutions
Supply chain of the future
•Supply Chain Development- Is “supply chain” still a valid description?
Supply chain 17th to 20th century
Supply chain early 21st century
Issues
Solutions
What next?
2 Presented by David G Wilson, CEO, Ontonix UK Ltd
For over 200 years “supply chain”
has adequately reflected the
nature and resilience of a [linear]
process from raw material to end
user. For all, except the largest
institutions: production; suppliers;
components; relationships; the
marketplace, were:
•Local & national
•Stock was “held”
•Relationships were personal – built
upon trust
•Operations & products were
[relatively] simple
•Quality & longevity were inbuilt
•Reputation &customer value were
paramount
•Supply chain 17th to 20th century
3 Presented by David G Wilson, CEO, Ontonix UK Ltd
The “supply chain” has changed..
…permanently. It has become a network of
inter-connected [non-linear] systems
•Local – National – Global – Virtual
•Production to delivery are de-centralised
and “just on time”
•Relationships became transactional –
eroding trust
•Operations got “lean” & Products
sophisticated
•Quantity and market share prevailed over
quality
•Costs & shareholder returns replaced value
with price and turned customers into
consumers
•Supply chain early 21st century
4 Presented by David G Wilson, CEO, Ontonix UK Ltd
According to Future Supply Chain 2016: Serving Consumers in
a Sustainable Way
“Increasing political momentum around issues such as
resource scarcity, climate change, security and new
regulations brings to light critical challenges that the
consumer products and retail industry will face in the coming
years. Solutions to these challenges require new thinking, new
approaches and new collaboration on infrastructures.”
According to the 13th Annual Global CEO Survey, CEOs are
confident about overall business conditions but still have a
number of concerns, many of which pertain to the supply
chain. Some of these issues include:
•Energy costs
•Potential Protectionism as a Barrier to Trade
•Climate Change Issues
•Scarcity of Commodities
•Supply Chain Security
As a result of these anxieties, supply chain risk mitigation will
be very high on the CEO agenda over the next couple of
years. In fact, a whopping 41% of those surveyed reported
plans for major changes in that area. As never before, supply
chain leaders will be challenged to reduce risks in new ways,
even implementing some risk avoidance mechanisms that
will actually add to supply chain costs.
•Supply chain of the future
5 Presented by David G Wilson, CEO, Ontonix UK Ltd
As the Global banking crisis so
eloquently illustrated: unmanaged inter-
connectedness within networks is a
source of fragility and systemic risk!
Conventional risk management tools
and techniques CANNOT identify
complexity within an individual entity,
system or network of systems
Financial instability and uncertainty are,
increasingly, sources of risk
Current risk rating methods [based upon
historical statistical sampling] are not
adequate for the new modernity
Risk modelling, like credit rating (PoD)
are discredited…overrated(!)
•Issues
6 Presented by David G Wilson, CEO, Ontonix UK Ltd
Quantitative Complexity Management
Ontonix provide an holistic, quantitative
(model-free), measurement of the data which is
the verification of function [business activity]
undertaken within the system…or
systems…being assessed
We work with the client to identify the metrics
required to adequately : map - measure –
manage – monitor, the structure and entropy
within the system
Utilising EBIT/DA data we offer a means to
identify and rate the current and upper
threshold of complexity within the system –
preferable alternative for a business who would,
otherwise, be unwilling to provide sensitive
financial information
Measuring and rating robustness whilst
providing valuable insight into the “hidden”
structure of a business is of enormous benefit to
the business, its partners and the carriers of risk
insurance – financial – credit
• Ontonix solutions
7 Presented by David G Wilson, CEO, Ontonix UK Ltd
Quantitative Complexity Management
Can aid the transition to systemTRANSPARENCY and SUSTAINABILITY byobjectively assessing and monitoringcomplexity “i2o” [inside to out] andserve as a foundation for:
RELATIONSHIP – built upon TRUST
ROBUSTNESS – from INTERDEPENDENCE: sharing RESPONSIBILITY & REWARD
QUALITY – shareholder returns through consistency: SUSTAINABLE STAKEHOLDER VALUE
These are the VALUES required[demanded] by smarter and moreloyal consumers in an inter-connectedworld
8 Presented by David G Wilson, CEO, Ontonix UK Ltd
•Solutions cont’d
We are actively looking to engage with supply
chain professionals, service industries and
academics devoted to maintaining Global inter-
connectedness as a supply chain “asset”.
SYSTEMIC RISK is NOT the exclusive domain of the
banking system or Global Corporations!
NONE of us can master risk and uncertainty so
robustness [resilience] must be built from within
an organization, system or NETWORK OF SYSTEMS.
We believe that, through discussion, research,
analysis and proactive management, we can
achieve our [mutual] goal of ensuring that supply
networks can quantify and demonstrate the
strength inferred by a chain and claim to be
“FIT FOR RANDOMNESS” .
•What next?
9 Presented by David G Wilson, CEO, Ontonix UK Ltd
