Blockchain: My Two Bitcents

One of the many things I love about working in supply chain is the exposure to new technologies. I/T companies and consultants evaluate a range of solutions, such as IoT, AI, 3D printing, robotics and blockchain. We try to identify where value can be added to the supply chain, and ideally, we leverage these technologies to drive customer value. Typically, my family and friends who are not in supply chain don’t ask me much about the industry; I’ve seen eyes glaze over the moment I mention those two words. But it’s been different with blockchain.

With all of the hype around Bitcoin and blockchain, I continue to receive questions about this concept. What is it? Will it matter? And, of course, where should I invest? (Sorry, I won’t be answering the latter question today.) Not only have I educated work colleagues on blockchain; I’ve sent my mother-in-law a link to an explanatory video, taught my kids the basic approach and shared content with my neighbors.

And while I’m no expert on blockchain – I’ll leave that to my colleagues in higher education, research labs, and high tech – I wanted to comment on a few of the concepts about what blockchain is and is not.

It’s not just a new technology.

Blockchain is not just a new widget, app or database. “It is a mechanism by which society can deal with how it arrives at truth,” explains Michael Casey, Senior Advisor of the MIT Digital Currency Initiative.

Most technology is based around institutions, such as governments and banks. Blockchain – a decentralized, distributed ledger – is complicated because it needs human beings to come together to optimize it. It requires trust.

Just ask Yuval Noah Harari, author of Sapiens: A Brief History of Humankind, why humans control the world: “Money is probably the most successful story ever told.” Cybercurrencies like Bitcoin further this story by agreeing on digital value. Harari’s position that money “is the most pluralistic system of mutual trust ever devised” is furthered by the decentralized trust mechanism of the blockchain.

It’s not just hype.

I’m not talking about crazy stock market behavior, which we’ve seen lately. Yes, cryptocurrencies are pervading Wall Street, and Bitcoin futures contracts are real – but don’t discount blockchain technology because of instability in the Bitcoin world. The concept and the impacts are substantive.

Cryptocurrencies are assets. They cannot be double spent. The currencies are “permission-less”, trusting a nebulous arbiter of truth; an open consensus mechanism. And while there isn’t currently an overarching methodology across all technologies, enough companies – and banks – are developing their own cryptocurrencies to take this seriously.

It is truly disruptive.

The global financial system is the most obvious example of disruption by digital currencies, from disintermediation of stock exchanges and trading houses to the institutionalization of ledgers. Consider, as Antony Jenkins has suggested, the friction and cost that the world would remove with a single global digital currency (although of course this still has risk and comes with complexity).

The significance and the range of use of blockchain should not be underestimated. It will stabilize currencies, eradicate corruption, provide visibility to voting and decentralize energy. And I didn’t even mention supply chain!! With added visibility and efficiency come provenance, smart contracts, unique identification, and registry of assets and transactions. This liquidates the supply chain, freeing up assets and enabling businesses to better respond to their customer needs.

It will take time.

While Bitcoin was created almost a decade ago, awareness of blockchain has skyrocketed over the past year. Opinions will vacillate as understanding improves and the hype reduces. But we still need to overcome a number of hurdles before we truly leverage the profound benefits of blockchain.

Scalability and cost are obvious issues, though these are exaggerated by critics. Issues with trust will continue to permeate. Legal and regulatory obstacles will interfere. The definition of quality standards for devices and processes will be essential for long-term success. But great strides are already being made on all of these fronts, and will continue to progress.

What does this mean to you?

Blockchain and its underlying fundamental concepts are the real deal. Some companies in this space will accelerate while others will collapse. I/T firms will grasp at how to derive real value in the short term. My advice? Don’t worry about abrupt ups and downs and anecdotes. It’s time to embrace blockchain and the fundamental transformation it will bring.

Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn

Developer Showcase Series

What advice would you offer other technologists or developers interested in getting started working on blockchain?

One needs to be open minded – It is very new technology and many are interested in it due to its popularity. Many don’t know what it does. Also, there are many platforms claiming to be blockchain frameworks, but real frameworks that offer end to end blockchain needs ranging from membership service to smart contracts are rare, so developer needs to be well versed with knowledge and open minded for selecting a technology and implementing it.

Platform – Permissionless or permissioned – It is very important to identify which type of network is suitable for your needs. Like enterprise level networks where each member has some role and is known can leverage a permissioned network, also known as a private network.

Identify use case and problem solution – Identifying use case and finding a value prop for each participant on network is significant before making a solution. It may work for one party, but since the network needs participation from all members who are required on network, it is important to have use case which serve purpose to everyone.

Give back – contribute to open source – This is very important for every developer, consuming open source platforms or making solutions around it. Open source platforms rely on contributions and an active community. Answering questions, being active on forums is a must if you really want to explore, learn and master a framework.

Give a bit of background on what you’re working on, and let us know what was it that made you want to get into blockchain?

At my organisation, Bristlecone Labs, I work as a blockchain engineer and prosper innovative solutions to serve supply chain specific use-cases. We have developed IOE + Blockchain solution based on Hyperledger Fabric 0.6 while 1.0 was still in its alpha phase. The solution is aimed at logging real time sensors data in its immutable ledgers and executing smart contracts on sensor data.

One of the use cases being smart contracts which execute on every sensor reading and checks if sensor crossed specific threshold, which may mean perishables are exposed to unsuitable conditions and have spoiled due to this. The system can help not only record such breach of contracts in immutable ledgers but can also identify responsible shipper and take corrective actions in real time. There is avoidance of any conflict with system in place and real time sensory data, optimisation and efficiency can be achieved by identifying rough routes and avoiding them, by having shock detecting sensors on shipping trucks transporting delicate or fragile shipments.

As blockchain is key to achieving the above scenarios where distributed participants can agree upon consensus, and benefit on big picture out of this system.

As there is a high interest from various big players as well as small players, plus the nature of blockchain platforms (being distributed, open source) also makes it available to everyone, by everyone, there is no “single owner” of these platforms and this technology but all of us working on blockchain are. This is one important fact which motivated me to jump into blockchain engineering and learn, contribute and innovate passionately for the better of the world.

What project in Hyperledger are you working on? Any new developments to share? Can you sum up your experience with Hyperledger?

Currently, I am developing a business network on Hyperledger Composer, although it’s in early stage of its development, it will be mostly a network of networks that will have suppliers identify an optimised supply path as well as have competitive advantage for being on a network than suppliers playing alone.

Hyperledger has been constantly evolving and has a very active community. Availability of production ready system that has high security and scalability in such early stages of blockchain technology is a bliss for developers. Availability of high quality documents and tutorials makes it easy for developers to jump into complex world of blockchain. As I started my Blockchain journey with Hyperlegder, after making some solutions, I have never felt short changed of features and possibilities that the framework offers. Having an active community with regular meetups and weekly updates keeps us flowing with recent changes and recommended coding guidelines.

What do you think is most important for Hyperledger to focus on in the next year?

I think, tools that make achieving end to end solutions faster and easier will definitely attract lots of audience and developers around the globe. Blockchain can be a complex topic for people from different backgrounds and giving tools for rapid development like Hyperledger Composer is a great value prop for people to adopt a simple and fast solution.

Keeping focus in improving such tools will really drive a large base towards Hyperledger framework. It is incredible what Hyperledger is doing and especially keeping it open source and public driven complements technology like blockchain, which at a core is – “there is no central authority.” Offering a framework which is contributed by the developer community around the globe, there is no way it can go wrong with great mediators and helpful, passionate organisers.

Blockchain is really going to have a big impact on how things function as of now (hence disruptive), and when business realizes true potentials of it, that’s when early adopters are going to really benefit.

Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn

The Process of Process Improvement

Streamlining and optimizing a business process leads to increased efficiency and greater customer satisfaction which further leads to a successful business. Everyone who has ever worked in any organization, be it a service provider, a software development firm, a manufacturing plant or a government outfit, can vouch for this.

What is the reason then that processes are not streamlined in every organization?

What keeps the organization from implementing and practicing the most efficient processes possible?

Let’s try and find out.

Somewhere in the organization, an inefficiency in terms of cost, timelines or resources is detected in one way or the other. The organization decides to improve the process related to the business unit and thus the whole project begins!

The first mistake that an organization often commits is to not think of process improvement as a project. When a project begins, the most important aspect of it that helps in guiding the whole process improvement initiative is the scope. Without scope, there is a high probability of the initiative diverting from the main objective.

Once the project is planned, the next obvious step is that of process mapping. When it comes to procurement, this step is referred to as procurement diagnostics. An accurate representation of current processes is the key in finding improvement scopes in any process. One temptation that the process mapping team needs to abstain from is that of improving a process while mapping the same. While it is true that low hanging fruits need to be targeted first for various reasons, it is not advisable to make changes to a process before fully understanding the same. It may reap some short-term results, but it will surely hamper the overall objective of process mapping.

The next steps in the project are that of improving the process, implementing it and then sustaining the same. While improving any process, the core project team who are the experts in process improvements tend to act condescendingly. The team, having worked in various projects, knows the nuances of the improvements to be made. But a top down approach in improvement suggestion does not essentially help in meeting the final objective. The simple reason is that in the tedious paperwork of process mapping and issue finding, the most important part of process is seldom taken care of: People.

A process is made of people, and if the people don’t accept the change, there is but a little scope of reaping the long-term benefits. How then do we take care of people while improving the process?

The first and the foremost step is communication. The idea of the process improvement project should be communicated well in advance to all the people involved. The communication does happen in all the projects, but in most of them, it is limited to the managers and team leaders. Communication needs to be identified as a key driving factor in successful project implementation. It is as important to listen to the concerns and suggestions of the people involved in the process as it is to convince everyone of the importance of the whole project.

Once the processes are mapped, and the suggestions taken from everyone involved, next step is to finalize an improved process. For a process to qualify as being improved, there must be a measurement metrics. These metrics are defined while deciding the scope of the project. Usually, these metrics include: ‘time taken for individual steps, ‘time taken for the whole process’, ‘cost of the process’, ‘SLAs’, ‘People involved’, ‘Automation level’, ‘Process Complexity’, etc.

There is one more way to measure a process performance which is often miscalculated by organizations. That is the measure of customer satisfaction. The word customer here does not necessarily mean the end customer of the organization. Any person, department or business unit which is dependent on the process should be considered as the customer. For example, in a procurement process, the requesting business unit becomes the customer and in some cases, the supplier needs to be considered as a customer.

Many a times, for internal processes, managers, team leaders and internal stake holders become the focus for all improvements. But unless and until the customer feels the difference, the process improvement project will not be a truly value adding activity.

All this may sound a little confusing and overwhelming, but once the process of process improvement is mastered, everything else surely does fall in line.

Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn

Why companies need to benchmark and how consulting companies help

In today’s competitive supply chain world, it is always recommended to use best practices in your respective working areas/tasks to have best results within given timeframe.

This can be only achieved by following Benchmarking practices.


Benchmarking allows companies to compare themselves with similar companies working in the same area of business or geographies.

Studying best practices provides the greatest opportunity for gaining a strategic, operational, and financial benefits.

Benchmarking is not equal to copying as conditions are never identical. You can create a system, define critical values, and apply them. Benchmarking is a tool for Total Quality Management.

Benchmarking gives us the following-

  • Better Awareness of Ourselves (Us).
  • Better Awareness of the Best (Them).

One of the reason of doing Benchmarking is to create a firm that is more adaptable to change.

Benchmarking Process-


In Benchmarking process, as shown above in Fig2, structured and systematic steps are required to be followed to identify gap between actual performance and the desired best practices/results.

Benefit-Benchmarking process provides opportunities for staff to learn new skills and be involved in the transformation process from the outset.

Benchmarking can be done at different stages of Sourcing, i.e. in automotive sector while doing category management, benchmarking can be done at Costing Stage, best practice Implementation Stage and even in the Packaging Stage.

Bristlecone realized the value of Benchmarking for a client by recently doing a Cost Benchmarking for one of the OEM Automobile giants based in India. It covered the best practices of Benchmarking as well. We covered three OEMs in this Benchmarking exercise. Detailed Benchmarking of various elements of different costs in a Costing Process was done and best solutions were recommended to the client. This also included alignment of best practices of Costings in SAP from manual Excel spreadsheets.

Continuous and breakthrough improvement is possible through Benchmarking. See the graph below which shows how Benchmarking accelerates Innovation and Change, and the situation is highly competitive at that point.


Also, below mentioned are the six principles of Benchmarking:

  • Comprehensive
  • Credible
  • Comparative
  • Performance Oriented
  • Confidential
  • Continuous assessment

Most businesses are not willing to do multistep benchmarking as it takes too long—from six to nine months; it is also a costly and cumbersome process to complete.

Here comes the role of consulting firms that can perform Benchmarking for different organizations at competitive prices. Consulting firms do detailed research and do extensive data collection to provide the best Benchmarking solution. A pool of consultants from different domains study the existing process, identify gaps, and develop action plans to find the best benchmarking solution.

Consulting firms do benchmarking by following a step by step procedure. The benefits which can be obtained are streamlined work flow, opportunities for improvements by identification of gap between actual and desired best practices/result and thus making a competitive strategy to achieve best results.

Thus, consulting firms act as an extended arm for doing Benchmarking.

Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn

Are you ready for Disruptive Innovation?

Can disruption and innovation go hand-in-hand? I often wonder about this, as I hear the word ‘disruption’ quite often. Over time, I have come to understand that disruptive innovation is characterized by two attributes. One, the new innovation is a new way of doing business within an established industry. Two, this new way of doing business is in direct conflict with traditional methods. The advent of internet banking and cab aggregators are a few common examples of disruptive innovation: for instance, cab aggregation is not just a novel way of doing the business of taking people places but is a new business model that is in direct conflict with existing modes of road transport across the world.

Extending the example to procurement, the emergence of blockchain creates a situation where every single supply transaction can be protected by the ‘influence of the many’. In other words, for any changes to be made to the data stored via this medium, consensus must be obtained. Examples of transactions include the issuance of a purchase order as a legal contract and the transfer of asset ownership.

This can be compared to the way nuclear codes work – a launch can happen only when everyone with the secret code enters it accurately.

It is perhaps safe to say that disruption in all traditional industries in general, and in procurement, in particular, is not just inevitable and something to be dealt with, but even desirable. Disruptive innovation using technology has the ability to transform the Supply Chain as we know it, be it through increased transaction security or by increased accountability at each step of the way.

“Thus, businesses will find that using innovation, they can reduce the cost of doing business, do it more efficiently and build a more sustainable solution that doesn’t bleed money and also provides long-term results.”

Are you ready? This is what disruption in procurement looks like, and we’re only skimming the surface here. Do note that most of these advancements already exist in the market.

Spend Analytics: Can you use AI to classify spend data? Products like Spend360 allows you to pinpoint every single spend on suppliers, understand why one method costs more than another and allocate spending so as to make most business sense.

Risk Management: By analyzing data from a company’s own portfolio of suppliers, as well as historical data from the industry, some products can predict the type and level of risk in procurement at each stage of product development. Such a solution can enable you to attach a premium to the risk, or to find ways to remove the risk from the system entirely.

Supply Intelligence: Churning data from millions of market sources enables products to accurately predict the price of most common supply commodities, including metals.

If this is already happening, you’d want to know what can be expected. Outrageous as the ideas themselves may be, no one ever thought blockchain could find such widespread acceptance. We can expect data to help us attach value to each sourcing operation, down to the molecular level. This can save businesses huge amounts of capital. IoT will also have a role to play in offering granular visibility across the procurement and manufacturing process by accounting for every single component digitally.

Research shows that in as less time as the next three years, traditional industry practices need to find a way to become complementary to disruptive innovation. Innovation would become the new norm around which traditional models work. Is your business disruption-ready? Here’s how to find out.

  • Do you accept that the face of the industry is about to change and that change is already underway? Every leader must look as far as ten years ahead into the future and be able to anticipate the realities of that time. Only then will the business have enough time to accept or challenge the disruption in their domain.
  • Do you have a personal impact matrix? Such analysis can help identify one or two key disruptors that would impact the business most severely. These aspects can then serve as the starting point for internal review and innovation.
  • Does your value proposition hold value down the line? Remember, disruption can make people go out of business overnight. With the advent of retail management systems and e-commerce, we are already seeing a reduction in the need for manpower. Evaluate your value proposition across a broad time period.
  • Can you disrupt the industry? If you have a revolutionary idea, it is best that you put it into practice first. This can give you an edge in the current market and put you first in the race in the future as well.
  • Are your departments integrated? Business intelligence is sourced from every single department in the business. While most manufacturers look at investment vs. output, it is time to measure the output against marketing spend, Supply Chain delays, product satisfaction and other KPIs independently and also as a consolidated result.
  • Are you willing to step out of your comfort zone? Some procurement companies find that they need to step into other industries, including but not limited to information technology and software development, in order to be able to cause a disruption or survive it. Business leaders with a pan-industry perspective are more likely to succeed in this endeavor.
Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn

Digitizing the Supply Chain

Many Supply Chain executives still operate their Supply Chain processes as if they were linear processes that can be broken down into independent functional silos. In today’s world, an enterprise is intricately connected to a network of customers, suppliers, competitors and supply chains. The right goods and services still need to be delivered to the customer at the right time, the right place, the right price and with the right quality. To stay competitive in today’s complex world, businesses need to change the focus of the supply chain process to be outside-in, i.e., centered on the customer’s customer and focusing on the right key metrics. Being profitable while delivering on this focus requires harnessing information deeper in the enterprise’s internal supply chain and information outside the four walls of the enterprise.

Enormous amounts of such information, many being near real-time, is now available to businesses via Sensors, Third-party sources, Supply Chain partners, and mobile and social platforms. There is lot of buzz in the market about Digital Supply Chain (DSC) being the Swiss knife to harness the above information sources – touting that the adoption of Internet of Things (IoT), Machine Learning, 3D printing, e-commerce platforms and many such technologies, will help achieve DSC maturity.

In my opinion, DSC is less about the blind adoption of technology and more about the focus on delighting the customer, and adopting an “outside-in” approach, so that [relevant] information and tools can be mashed up with internal data, to create customer delight. Leveraging this information to better sense and understand customer demands, manage the supply chain, and deliver customer delight is going to be essential to a business that needs to adjust quickly to changes in market demands, technology and, most importantly, customer expectations.

What is a Digital Supply Chain?

A Digital Supply Chain (DSC) enables a customer-centric networked ecosystem that can capture and utilize customer data, sometimes in near real-time, to enable demand sensing, demand management and demand matching while adhering to strict compliance and security guidelines, and optimizing performance and risk.


DSC is often confused with adoption of technology. However, in reality, a DSC is one that has realized the benefits from the massive amounts of information available via emerging technologies; Artificial Intelligence (AI), IoT and Robotics are just enablers. In addition, none of this data and consequent analysis is useful/actionable without meaningful collaboration between various functions in the organization – from sales to development, manufacturing, delivery services as well as external stakeholders–suppliers, partners and customers.

How can digitizing Supply Chains help your business?

“The Digital Supply Chain holds the promise of real- time data to sense demand, drive innovation, reduce cost and deliver the customer the right product at the right time and price.”—Bill McDermott, CEO, SAP (Germany)

According to a survey conducted The Center for Global Enterprise (CGE) as part of the Digital Supply Chain Initiative (DSCi), digital supply chains can reduce procurement costs for all purchases of goods and services by 20% and reduce supply chain process costs by 50%. In addition to decreased costs, improvements in the DSC have the ability to increase revenue by 10%. *

DSC Networks are more agile and resilient

The DSC is no longer the traditional linear system from manufacturing to delivery. Rather, it functions like a completely transparent network of manufacturers, suppliers, distributors, partners and customers, aided by integrated systems, smart procurement, warehousing, and digitized logistics management. Whether it’s raw material at below the acceptable inventory levels, a spike in customer demand or a machine failure – all of these become visible, in near real-time, to stakeholders in the network. This enables the players “foresee” potential disruptions, giving them the ability to move quickly to fix issues. Customers get the benefit of efficient and transparent service.

DSC facilitates flexible and collaborative businesses

Rather than each function operating in its own silo, the outside-in DSC offers a transparent view to all stakeholders. Traditional supply chains have not been able to solve the problem of collaboration, largely because each stakeholder has a different set of goals. Buyers want rock-bottom prices, suppliers want to maximize their profits and keep their inventory costs and levels under check, and sales wants highest amount of products. Having technology and applications in place is not going to change any of this. However, measuring the right business metrics, for example, operational risks, inventory levels, on-time delivery, etc., and making it visible to all stakeholders can improve operational efficiency.

DSC makes the supply chain cognitive

DSCs harmonize internal and external data, near-real-time big data from IoT, sensors, mobile and social platforms. Application of automated data mining, predictive analytics and optimizations let many decisions to be taken by this smart Supply Chain, thus making the business become more proactive and efficient.

Consistent customer experience

Omni channel marketing helps companies deliver products and services in a consistent manner across all channels. This provides competitive advantage to businesses that have adopted outside-in Supply Chains. Analytical tools combined with Supply Chain strategies for demand stimulation and management will help companies deliver customer delight.

Improved risk mitigation

Early warnings from near real-time big data can help companies avoid potentially disruptive situations, set up mechanisms to handle risks and be more proactive. Predictive analytics help mitigate business performance risks, which can reduce significantly in a DSC. At the same time, this needs to be balanced out by driving compliance requirements by collaborating with various groups.

With governments across the world passing new legislations and regulations, compliance has become one of the major requirements for most companies.

The collaborative and transparent nature of DSC makes it easier for companies to communicate with stakeholders and see to it that compliance requirements are satisfied. Business contracts can be structured into pre-contract, contract and post-contract performance. Mining this data across various suppliers to evaluate performance and risk versus actual contract terms will help businesses decide which suppliers are a no-no, predict problems, and improve contract terms.

Accelerate your Digital Supply Chain journey with Bristlecone

Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn

Bristlecone-Pulse, October 2017: Mapping the Future of Supply Chains

And it’s back! The third Bristlecone Pulse Conference is being brought to you at the world-renowned MIT campus in Cambridge, MA. Scheduled for October 25th to 27th, Pulse 2017 on the East Coast will be about ‘Your Roadmap to Antifragility’. Antifragility is the radical concept introduced by philosopher-author-financial analyst Nassim Nicholas Taleb in his book, ‘Antifragile: Things That Gain from Disorder’, that talks about systems that grow and even thrive in disruption.

What does antifragility have to do with Supply Chains? Join us at Pulse to listen to our distinguished and eminent thought-leaders speak on an assortment of topics such as Enabling Antifragility in Supply Chains and How Machine Learning Impacts the IoT network.

We’re very pleased and honored to host Prof. David Simchi-Levi, renowned Operations and Supply Chain expert and Engineering Systems Professor at MIT as well as Chairman of OPS Rules. Dr. Simchi-Levi will speak on Delivering Customer Value through Digitization, Analytics and Automation.

Dr. Federico Casalegno, Associate Professor of the Practice, is the Founder and Director of the MIT Mobile Experience Lab at MIT. He will focus on Designing Networked Digital Technologies to Foster Connections in his address.

We’re excited that Dr. Abel Sanchez, Executive Director of MIT’s Geospatial Data Center and Architect of “The Internet of Things” global network will bring Connected Intelligence for Pulse attendees.

Dr. Leonardo Bonanni is the Founder CEO of Sourcemap, a MIT start-up specializing in Supply Chain mapping and transparency. His talk will be about Transparency and Sustainability in Supply Chain.

Our President and CEO, Irfan A Khan shall deliver the keynote address. Mr. Khan will also be featured among many others in our panel of business leaders from the consumer goods industry who will talk about the huge changes sweeping across our industry and enabling the digital transformation of Supply Chains.

This prestigious event is your chance to network with the movers and shakers creating futuristic Supply Chain technologies. Be there to get your ringside view of tomorrow’s Supply Chains. Take back learnings to make your Supply Chain future-ready.

Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn

The New Answer To ‘How To Keep Customers Happy’: Positive Disruptions In The Supply Chain

For businesses, the very idea that disorder can lead to growth and movement is unthinkable. However, could it be possible that there are business models that gain from chaos and disruption? Is this kind of positive evolution achievable by any and every business, and under all circumstances?

Think of this radical concept: An antifragile entity looks for disruption because that is where it can grow best.

Each day, as businesses strive and struggle to serve consumers better as a means of gaining market share, we are left in no doubt that we need to transform our existing processes. And positive disruption is one way to do just that with our Supply Chains.

I’ll put it this way- positive disruption is already happening. In this piece, I discuss a few ways by which the traditional idea of Supply Chain management is changing and evolving to keep up with the times.

SaaS In Retail Management

Software as a Service (Saas) has replaced nearly every software application we have known in our lifetime. The G Suite is basically all of Microsoft Office, with a few added perks. The icing on the cake is it doesn’t need installation, a key and a licensed proof of purchase. There are several advantages of running an application much like a service- it is available everywhere, it doesn’t take up disk space and it keeps the business operations transparent.

In retail management, SaaS and the availability of multiple channels to sell across have evolved alongside each other. Today, spreadsheets are no longer the go-to choice for inventory handling and calculation. Software products have the ability to track sales in real-time and adjust inventory accordingly. Being machines, they can do this every single minute of every single day.

Retailers who adapt to such retail management practices and don’t shy away from going digital gain better insights into their business and achieve higher consumer satisfaction, as they don’t run out of stock due to oversight. They hold inventory at levels that are just optimal, to prevent extreme scenarios such as stock-out or dead stock.

Take a step back in the chain, and you see some retail management products giving you the option to automate the raising of purchase orders based on sales trends across channels. In the end, the consumer benefits from speedy order processing and seamless fulfillment, thus building brand trust and loyalty.

Crowdsourcing the Warehouse

You’ve got to hand it to Amazon to do something others can only dream of. At the beginning of this decade, Amazon had what most small businessmen cannot hope for- extensive warehouse space and impeccable logistics. So it did what no other marketplace has done before, or since. It opened its doors to those retailers and gave them access to sophisticated practices. Amazon knew that small-scale retailers wouldn’t be able to do this by themselves, and so it charged them a fee for using its services.

The takeaway from this? Money spent must offer instant gratification. By using this little insight into the human mind, Amazon today truly sells products from A to Z, by crowdsourcing them from other retailers and working on what it does best- fast delivery.

I think this behemoth is the perfect example of antifragility. When it came to the question of putting all that space to use, Amazon could have chosen to invest in inventory as well. Instead, it made others invest in its inventory and even claimed a fee for this investment.

What do retailers get? The Amazon Prime advantage in some cases, and visibility in others. Consumers get the secure feeling of shopping from a known brand and, thus, drive more sales to the marketplace.

Evolving Automation

The Industrial Revolution is considered a revolution because it was the first large-scale use of automation to achieve more than humans ever could. I think the next revolution will be digital in nature. With Machine Learning and AI taking center stage, we can look forward to hitherto unknown forms of automation that can disrupt our understanding of the Supply Chain.

We already have systems that can raise automated purchase orders. On the vendor/ manufacturer side, we may have systems that can ‘read’ these orders, look to past ordering trends, and if the order in question is consistent with past data, send it into production/ dispatch.

In other words, there may be no need for human intervention for basic decision-making, which is often responsible for most of the hold-ups in a Supply Chain.

Since the manpower involvement is greatly reduced, the end product cost may be much lesser than what it is now. In a distinct advantage to consumers without loss of profit for sellers, we may see expensive products categories become more affordable and easily available.

New-Age Enterprise Resource Planning

The emergence of SaaS and APIs has given software products a chance to communicate with each other seamlessly. This is why integrations are the future of all businesses that depend on their Supply Chains.

A typical ERP system today can also be integrated with a CAD and a product lifecycle management system. An inventory management product can have accounting and shipping features integrated into it. The best part is that each of these services is never built from scratch. For example, an ERP solution can also find a way to integrate with financial service modules such as SAP S/4HANA so as to achieve complete consolidation of financial data and enable the evaluation of financial implications of a certain decision.

For a fraction of the price, businesses now have access to the best services in each domain. All of these digital personas work together with the same intuition as a human system and the efficiency that only machines can achieve.

Improved efficiency across the organization in the form of a highly robust Supply Chain directly translates to improved consumer experience- either due to the speed of processing or due to the reduction in errors and uncertainties, or both.

Now, more than ever, businesses need to consider how best they can adapt to changing conditions. It isn’t enough anymore to just do it because everyone else is, but to be the first in the line, such that with every new development, there is more scope to grow as an enterprise.

Every business that hopes to thrive in today’s market must ask the question, “Where do we go next?” Becoming antifragile may just be the answer.

Twitter – @irfantalks

Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn

Supply Chains get smarter with Artificial Intelligence

Having missed a dear niece’s birthday and trying to make up for it, I browsed through my regular gifting site last week. Sarah greeted me, asking how she could help me. So as I said, “Hi, I forgot my niece’s birthday”, Sarah responded with “What does Khushi like?”

“Hmm, basketball and phones are her latest interests,” was my response. Sarah asked for my budget, which I stated with a slight hesitation. She then suggested that I pick up tickets for the upcoming season or a voucher for iPhone X, if I was rethinking budgets (oops! that’s way out of any budget!). I went with the former and Sarah confirmed that the tickets would be delivered directly to Khushi’s address. Impressed.

But, why am I talking about this? Isn’t this regular? The difference is that Sarah is a ‘bot’, she is enabled by Artificial Intelligence (AI) and has been ‘learning’ based on my interactions with her. The bot will further communicate with the order management system, and the order would be processed. Being a tech enthusiast, I did get thinking about how all of this is going to impact our future. Clearly, AI is here to stay and clearly modern supply chains are going to be completely disrupted by a gamut of AI solutions!

How will AI impact the Supply Chain?

AI solutions imitate human behavior. In other words, AI solutions can be used to make decisions, just like humans, and “learn” (just like humans) over a period of time. Often, human decisions are taken based on many factors such as using existing data and prior experience (intuition anyone?). Eventually, AI solutions should ideally be able to do the same.

While the Digital Supply Chain (DSC) is bombarded with real-time data coming in from various sources – social, internet, sensors and enterprise data – all of this data is useless unless it can be used to lower costs, increase revenues and improve customer delight. AI solutions can be used to do all of these, often with better accuracy and efficiency than humans. They may not yet (or never!) replace humans completely, but with every new advance in technology, we are surely getting into a living side-by-side.

What kind of transformation are we looking at with AI?

Supply Chain Management is critical to businesses. The utopian scenario is one in which planning, order management, procurement, manufacturing, warehousing, inventory and delivery all seamlessly work together to deliver unmatched customer service. This, or at least part of it, will be possible due to AI solutions.

In the last couple of years, supply chains have been increasingly using AI solutions for forecasting and demand management. However, this is only the tip of the iceberg.

According to the SCM World Future of Supply Chain Surveys, 2016, as many as 47% of supply chain leaders expect that AI / Machine Learning solutions are going to impact Supply Chain strategies.

As vast as Supply Chain is, there is no limit to how much AI can do for it. Accuracy and automation are only some of the areas where a Supply Chain can derive specific benefits, but there’s a lot more. Driverless trucks, smart warehouses, drones doing last-mile delivery are a few of the latest innovations, and there’s much more in store. Here’s what is in the works:

Complete automation of the Supply Chain: Right from Demand, to Work Order, Production and Delivery, the Supply Chain works as one smooth chain. Companies have already started to automate complete production lines using AI, which means a round-the-clock production without human intervention or supervision.

Smart Warehouses: Increasingly, robots are being looked at to supplement and, eventually, replace humans in warehouses. For example, forklifts are already being replaced by robots that can handle heavy loads, while “sensing” obstructions. Industrial robots can be trained by humans to grasp objects and move them around. As technology improves and robots become more sophisticated, warehouses may even become the training ground for completely running everything autonomously!

Better contingency management and fewer disruptions:Weather conditions such as hurricanes, flight disruptions can all lead to trouble in logistics. For example, if you know that a hurricane is expected in Florida, you would reroute your freight or postpone the delivery. AI solutions can help raise red flags and help all stakeholders manage disruptions better.

Revolutionizing logistics and transportation: Customer demands, such as same-day delivery, decentralized production and personalization, will force logistics providers to be agile and flexible. Driverless trucks are being prototyped (an Uber-owned company even delivered 50 beer cans (!) using a driverless truck recently) and unmanned aerial vehicles (UAV) are being looked at for last-mile deliveries. While these may be the future, the vast amount of data available can be used to simplify distribution networks and optimize routes using AI solutions and predictive analytics.

Automated Procurement guidance and Virtual Personal Assistants: Besides deploying AI-based applications in areas such as spend analysis and contract analysis, according to a Gartner report dated May 2017, it is expected that Cognitive Procurement Advisors (CPA) will be used to provide recommendations and advice on risk management, compliance, supplier management, etc. Virtual Personal Assistants (VPA) can improve user experience, and provide guidance to the right procurement tools, thereby increasing cost savings and efficiency.

Improved customer and supplier management: Customer queries can be answered by AI solutions. You can have an AI-based voice response system, which has knowledge of your product, which is automated to answer typical customer queries, both for customers and suppliers.

Next-gen Demand Management: Real-time visibility into business risks, opportunities, supply status, customer behavior, and sales insights can be used to create integrated AI-based demand management systems. Near real-time big data, such as from IoT devices and sensors, will make it possible to have an agile demand platform.

At Bristlecone Labs, we have been working with cutting-edge technologies that will impact the Supply Chain. One of our recent innovations is our first Monitor Bot named Hari, which enables Supply Chain teams to remotely tour, monitor, and engage with factories and facilities from a safe and convenient location. More importantly, Hari is integrated with Bristlecone’s NEO™ Platform and we learn with Hari’s every move – leveraging voice controls, remote controls, two way audio-video streaming, IoE, blockchain and automation – Hari and Bristlecone NEO™ empower Supply Chains professional with AI capabilities to execute an anti-fragile Supply Chain.

We expect that a Digital Supply Chain of the future will be a Cognitive Supply Chain – which is intelligent, self-optimizing and resilient – thereby becoming anti-fragile and thriving in the world of constant chaos.


Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn

SAP Info Day for Procurement October 5, 2017 Sinsheim, Germany

The SAP Ariba Info Day in Sinsheim on October 5th, 2017 was another clear indication that integrated sourcing and procurement has become a core element in the digital transformation strategy of most leading companies, be it in the manufacturing, retail or financial services industry. More than 200 participants followed a versatile mixture of latest software developments and strategy, customer projects and use cases, as well as talks with potential implementation partners. It is not that more proof was needed, but the key topics presented and discussed demonstrated once more, that the times when sourcing and procurement could be regarded as hived off disciplines, are over. The future will be digital and dominated by holistic, integrated software solutions, where sales, distribution, production, sourcing and procurement are run synchronously, according to the rhythm of the market. It won’t be long until planning and execution systems will function in a truly interwoven fashion. And a big portion of IT-related issues will take place in the cloud, streamlining companies’ IT setups and shortening innovation cycles.

As always, major shifts come with risks and opportunities. Those companies that embrace this development early on and direct their strategies towards integrating and digitalizing their processes can significantly improve their competitiveness and market position. Because of the overall complexity with organizational, processual and technical aspects to be considered simultaneously for sustainable results, the right roadmap is often not easy to see. Reaching out to specialized consulting firms for support is a good plan, if the addressee has the right skill set. The related, shifting requirements pose challenges to consulting firms alike. Global presence, holistic supply chain process know-how, rather than focused expertise on one single discipline, will become the future ingredients to deliver the expected high-quality outcome.


Share on FacebookShare on Google+Tweet about this on TwitterShare on LinkedIn