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Supply Chain Management 4PL - Orchestrating your supply chain

For your supply chain, the future is already here, and its success today (and tomorrow) requires the right set of skills: How 4PL solutions can help.

What does this new future of supply chain management look like?

The Covid-19 pandemic clearly demonstrated that the traditional model of logistics and supply chain management was unable to deal with high levels of uncertainty. When accurate forecasting became close to impossible, supply chain managers were left to chase after real-time intelligence. Recent experience has highlighted that a very high level of transparency is needed to support on-the-spot decision-making that has become the new norm.

As a result, the supply chain (often taken for granted in the pre-Covid era) has become a key strategic asset. It's no longer simply a matter for the backroom, but a key issue in the boardroom.

A skills-driven supply chain

However, this valuable resource has to be more than the sum of its technological parts. Now, more than ever, supply chain orchestration requires the right people to execute. This includes individuals who can rapidly assimilate huge amounts of information with real-time problem-solving capabilities, and work effectively across silos.

This means thinking big, which requires the right set of skills. Traditional supply chain management remains a core part of it; a solid end-to-end operational understanding, functional knowledge and market intelligence are as important as ever. Understanding the process in detail, knowing exactly what your options are and having the ability to solve complex problems is a must. Finally, since you’ll be coordinating your efforts with others, the ability to effectively manage people is essential.

Analytical skills that can obtain insights, intelligence and improve service delivery. Knowing where and how to gather, analyze, clean up, and supplement data makes it possible to detect patterns and extract intelligence. Engineering and implementing digital tools and algorithms turns this intelligence into targeted predictions that help supply chain teams make better-informed decisions.

Another a highly valuable asset is the ability to design and manage changes in the supply chain, including manual interventions, systems or workflow. Co-coordinating with suppliers, logistics partners and IT teams is a vital part of delivering on commitments.

In theory, these requirements drive the need for network engineering, a project management and technical innovation skills. Individuals must possess digital dexterity and a 360-understanding of every component of your supply chain.

Supply chain orchestration

In practice, these skills are usually brought together in a supply chain management team that covers all the capabilities required. Such a skilled group can deliver results with support from digital solutions to automate repetitive tasks, collate multiple data sets, and prompt timely action.

This is where the control tower team of specialists comes into its own - a combination of intellectual capability and practical expertise. You can compare it to the interaction of members of an orchestra performing a piece of music. Soloists and ensemble players, each with a mastery of different instruments, are called on by the conductor to provide their contributions at just the right moment, creating a harmonious whole. Ensuring that a supply chain delivers is not so different. One must draw on the skills and disciplines available to compose comprehensive solutions and address issues as they arise.

For example, analytics might highlight a significant number of demurrage and detention events on shipments for a particular client. Additional work by data scientists could identify a number of incident hotspots. That’s where the partnership between our teams and our client organizations pays off. A fix could involve implementing predictive analytics to flag up issues ahead of the point when demurrage charges are incurred. Co-ordinated interaction ensures that the supply chain operates as smoothly as possible and resolves the kind of problems that can never be planned out of existence.

Harnessing collaboration

Kuehne+Nagel worked with a longstanding client (a leading imaging solutions and technology group) to review its entire inbound supply chain, involving shipments all over the world. By identifying and evaluating areas for possible improvement, as well as any potential risks, we were able to lower costs by 17%, but also reduce lead times and the number of containers used, shrinking the client's carbon footprint.

Our 4PL team is able to deliver so effectively because we have the supply chain experts, engineers, project managers and innovators that the optimization process requires. Comprehensive understanding can only come from collaboration, bringing together the skills needed for a common purpose.

We are convinced that the supply chain of the future will be shaped by partnership infrastructure, digital infrastructure and benchmark data, but especially by the collective talent we have at our disposal. Our 4PL capabilities, our shared expertise and resources, give us the capability to deliver sustainable value to your business.

Kuehne+Nagel Integrated Logistics: Orchestrating your success.