Customer Driven Supply-Chain Strategy with Digital Planning

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As the world starts to settle into a new normal, there is a boom in customer demand with more than 50% of US consumers expected to splurge on themselves due to being pandemic-fatigued. 

Over the past year, all retail categories have seen an increase in online penetration with retail-oriented credit card spending increasing 35% from January 2020 to 2021.  Of the three-quarters of Americans who changed their shopping behavior since COVID-19 began, 40% say they have switched brands, with convenience and value being the main drivers of shopping behavior change. 

To capitalize on pent-up customer demand while staying ahead of potential supply chain disruptions, organizations need to have a real-time, predictive, and collaborative supply-chain planning platform in place.  Now is the time to use a platform that knows how much product to produce, which gains the lead times necessary to ensure no delays in procurement or distribution, and understands customer behaviors to optimize sales. 

According to Gartner, more than 80% of companies plan to develop digital supply chain capabilities in the following years.  While ambitious, this shows how crucial supply chain evolution truly is.  It allows organizations to align their current business demands and alleviate the strain these increased customer expectations are creating.

The Need for Supply-Chain Collaboration Processes 

Planning is fragmented and siloed across sales, marketing, finance, and supply chains for many organizations.  This lack of visibility into other workstreams often leads to adverse outcomes that can undermine overall company performance. 

For example, there can be too little supply to meet the actual demand when there is insufficient communication between departments, leading to stockouts, delayed orders, and possibly lost sales.  In contrast, too much supply translates into high inventory costs, waste, and spoilage

Capitalizing on consumer demand is a cross-team effort.  One such Vanguard customer, Bundaberg Brewed Drinks, managed their demand planning with a spreadsheet-based process that was disjointed and inefficient.  With Vanguard Predictive Planning™, Bundaberg Brewed Drinks now has an integrated approach to global sales and demand planning that allows for cross-team visibility.  This has resulted in reduced manual work and improved forecast accuracy of consumer demand. 

Digital Planning for a Customer-Driven Supply Chain Strategy 

Planning plays a vital role in a company’s ability to meet consumer demand, even with disruptions.  To strengthen this process, organizations have to transform how they approach it, not just by bringing together fragmented, independent pockets of capabilities but also by integrating long-term strategic planning with shorter-term operational planning and execution. 

These key characteristics mark this evolution toward digital supply chain planning: 

Data Architecture – Cloud-based, AI-powered integrated planning will sit at the center of planning.  This allows for the seamless exchange of data across functions and the entire supply chain.  In the end, organizations can ingest and integrate a wide range of internal data sitting in legacy solutions, such as Excel, into intelligent solutions, like Vanguard, with advanced analytic capabilities. 

Autonomous Operating Models – While the technology and data infrastructure evolve to provide access from anywhere within or even across organizations, operating models will become more centralized, and planning will become increasingly automated.  As organizations automate more planning decisions, intelligent software will increasingly make those decisions and handle routine tasks, freeing planners to focus on strategic business decisions. 

Dynamic Planning – Advanced analytic capabilities allow for plans and their targets to be dynamic rather than static.  Plans can be updated continuously and in real-time.  This enables organizations to continually optimize plans to reflect demand and supply at every moment, creating an agile supply chain ready to take on any disruption. 

With intensifying pressure across all industries to have a customer-driven supply-chain strategy that drives growth, the question supply-chain leaders face is not whether they need to change how they plan.  It is how they intend to evolve their planning process to solve the problem that has plagued supply chains for decades: how to optimally balancing supply and demand. 

Do you want to gain the benefits of digital supply-chain planning but not sure how to begin? Download the recording of our webinar, Breaking Up with Excel, and see how digital planning reduces costs, increases lead times and makes forecasts more accurate.