Improving the plant-to-supply chain linkage

The focus for manufacturing operations in the consumer-packaged goods, CPG sector is changing. Where before plant efficiency was the top priority, this has now expanded to include agility, both of the plant and the wider supply chain.

In the past, the goal of digital investments was to improve cost efficiencies, with overall equipment effectiveness, considered the main key performance indicator. Even when supply chains became global, further increasing the risk of disruptions, manufacturers protected plants from variability with inventory so they could continue to focus on efficiency. However, the pandemic fundamentally challenged this way of working.

The speed at which it was able to disrupt global supply chains has been an unprecedented stress test, and one we are still in the midst of. Almost every day there’s a new story about shortages caused by supply chain disruptions.

Covid’s effect on the manufacturing world simply amplified existing vulnerabilities, and as much as we might want to go back to how things were, this appears unlikely to happen.

Last year, a World Economic Forum report identified shifts of focus that have come from businesses dealing with demand uncertainty and disruptions.

At the top of that list is agility and customer centricity, closely followed by supply chain resilience. These are now core topics in the post-pandemic recovery discussion, and manufacturing plants play a critical role in responding to today’s rapidly changing market conditions.

Built with real-time operational data, digital twins can help understand what the plant is capable-to-promise, by providing real-time situational awareness via edge-to-enterprise visibility. Furthermore, the digital twin provides the foundation for AI and predictive analytics to provide powerful insights that empower workers to optimise processes and throughput.

To respond effectively to supply chain disruptions that are occurring on almost a daily basis, capabilities like advanced planning and scheduling can align the plant with supply chain planning to quickly adapt to fast-changing situations. Improving the plant-to-supply chain linkage gives the business more options to respond by looking holistically across the source-make-deliver processes.

Coupled with knowledgeable and empowered workers, who are the ultimate drivers of continuous improvement and resilience, businesses can really push the boundaries of their agility. Indeed, a key factor for future manufacturing operations improvements is collaboration of people and systems.

Digital transformation makes information more accessible to employees, connecting them to plant processes, data and systems as well as other workers across functional domains and functions, developing a living repository of staff knowledge and experience.

Businesses cannot control incidents that occur across the wider supply chain, but having agility and resilience allows them to adapt quickly.

KEY TAKEAWAYS

• The speed at which the pandemic was able to disrupt global supply chains has been a stress test.
• Almost every day there is a new story about shortages caused by supply chain disruptions.
• In the past, the goal of digital investments was to improve cost efficiencies.
• Even when supply chains became global, manufacturers protected plants from variability with inventory.
• Built with real-time operational data, digital twins can help understand what the plant is capable-to-promise.
• Digital twin provides the foundation for AI and predictive analytics to provide insights.

To respond effectively to supply chain disruptions, capabilities like advanced planning and scheduling can align the plant with supply chain planning.