In this joint interview, Fabien Esnoult, President of SprintProject and François Deprey, President of GS1-France, return to the issue of how ‘smart supply’ came about and the challenges it represents for the supply chain of tomorrow.
For several years SprintProject has had the pleasure of browsing the halls and aisles of CES in Las Vegas, the go-to venue for technological innovations, seeking trends and innovations that will undoubtedly introduce transformations in the supply chain of tomorrow.
On our 2019 visit to CES it was all about smart ecosystems – they were unavoidable. Everything – absolutely everything – was ‘smart’, so to speak, and it became clear to us that every section of the industry would eventually be communicating mainly via voice platforms and AI. That’s where the concept of smart supply came from.
Logically enough, if the world around us becomes ‘smart’, the supply chain will itself have to connect to other smart ecosystems in order to improve. However, the thing that will set the pace of the switch from supply chain to smart supply will be how easily it is accepted and how fast these new technologies are integrated into our businesses.
But what is smart supply exactly? Well, it was as we were strolling down the aisles of the Las Vegas Convention Center (LVCC) in 2019, amidst all these smart ecosystems (except for supply chain), that François Deprey, President of GS1-France, first came up with the official definition of what SprintProject was created for, on the Google wall: ‘Smart Supply by SprintProject’.
The first instinct (down to Fabien) was to take a group of leading supply chain players to CES in Las Vegas. The concept of ‘smart supply’ was just a hypothesis. There is no escape for supply chain from a world controlled by information, so important is flow-related data in the search for new, more efficient business models.
At CES, the supply chain was everywhere and nowhere at the same time: everywhere as the common factor linking all the sectors represented, but nowhere as a sector itself, because it was in a state of flux. Attaching the prefix ‘smart’, as in other domains, has now elevated it to the position it deserves in the digital transformation of the economy.
First, let’s focus on the overall concept of the ‘smart’ world – smart cities, smart buildings, smart vehicles, smart energy. ‘Smart’ is about creating interaction between the different ecosystems.
So the supply chain, already transversal by nature and integrated with other ‘smart’ ecosystems, will facilitate connections mechanically between the ecosystems of the city, buildings, vehicles and energies.
It’s the end of a supply chain that operates in isolation and the advent of business exchanges and intersectoral data. In other words, the supply chain of tomorrow is connected to other connected ecosystems, it’s ‘smart supply’.
There’s a whole range of things that can be included in this concept, but I’ll restrict myself to just two. First, in terms of the system, smart supply is a supply chain that has emerged from its insular existence and entered an open, shared world, like other sectors.
The second thing, which concerns the way of opening up, is the data and the tools we now have at our disposal for using it. The threshold we’re stepping over here is that of artificial intelligence, which is much better than the human brain at processing the almost infinite mass of data that supply chains will produce. Smart supply is a supply chain based on data, which makes new models possible; models that are more efficient, more sustainable and more resilient. We talk about ‘smart supply’ but we could equally say ‘augmented supply chain’, or something similar.
There are several major challenges for smart supply. The two main ones are:
Improving processes by integrating smart technologies. Integrating smart supply in processes will enable better management of warehouse flows, increased availability of docking bays, improved traffic flow in cities, management of parking spaces and even traceability of international flows (trucks, boats, planes, etc.).
Getting to grips with these new technologies and their constraints on our business environments, for example: expensive investments and returns on investment, the control and adapted analysis of data, AI, etc.
The major challenge for the supply chain will be the same as before: efficiency. But it won’t be about focusing strictly on economic efficiency; supply chains will have to respond to new social and environmental paradigms. We will have to learn how to ‘measure’ differently, using common sources as the basis.
The other challenge will be controlling data in increasingly complex value chains. Just like with new technologies, the supply chain does not tolerate ambiguity. The use of IoT, robots, artificial intelligence or any form of automation will significantly increase the need to share data in a fluid and, to reiterate, unambiguous manner. The robots in one sector must understand the robots the other.
This is one of the fundamental challenges of inserting the supply chain in the world of digital ecosystems – getting away from the proprietary logic that dictates ownership of data.
In a circular economy, for example, the very notion of supply chain, which implies a linear and finite approach over time, will be completely overturned. There is no room in these future models for not making data circular as well.
In view of the evolution of technologies and systematic deployment of the smart ecosystem in other business areas, smart supply is no longer a futuristic option, it’s actually happening. Its implementation will accelerate over the coming months, involving in particular:
The ongoing transformation of all business sectors will accelerate the emergence of the ‘supply chain of the future’ irreversibly; it will be more digitised and, inevitably, more social and more environmental. Two ways of being ‘smart’, to sum up. These are the two pillars of the European Green Deal too.
Initially, supply chain will be obliged to comply. The main obligation, of course, is to remain competitive in a market where players are making new offers made possible by all the technological innovations at their disposal. The second is the redoubling of social and environmental pressure exerted by consumer demand, especially since in a circular logic it becomes a means and not just an end. This last point will also be reflected in the regulatory framework (incentive or restrictive) which will inevitably steer investments towards a ‘smarter’ supply chain.
But the common use of data could give rise to more collaborative models aimed at collective gains that are greater than the sum of individual gains. A vision like this would be a tremendous accelerator and would justify permanent adoption of the term ‘smart’.
SprintProject, an ambassador for #SmartSupply, highlights the need for industry players to strive for innovation. To this end, SprintProject will discuss the major trends and issues set to shape the supply chain of tomorrow on different platforms (webinars, blog articles, etc.). These topics will also form the central focus of our visit to CES 2021.
Yours in Sprint,
For updates on #SmartSupply news:
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