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Predict, Not Just Respond

Supply Chain Model Accuracy is the Key to Digitalization

According to a recent article by Gartner: “priority should be given to evolving the digital supply chain twin — can’t do anything E2E without this foundational capability.” Furthermore, they say that: “Before you can do the prediction and prescription (which together equals decision making) … you need to create a model of the supply chain upon which you can predict and prescribe.”

Gartner

This implies that the foundation for visibility and decision-making is digital twin. A “twin” implies an accurate model of the supply chain, a look-alike. At Adexa we refer to this as the Digital Mirror© of the supply chain. As Gartner correctly says “The digital supply chain twin is built from granular data to form a dynamic, synchronized, real-time and time-phased representation of the various associations between the data objects and entities that ultimately describe and make up how the E2E physical supply chain integrates and operates.”

Model accuracy cannot come from simple S&OP solutions that are now so prolific. S&OP systems by themselves are a rough (spread-sheet based) model of the supply chain. [See this Whitepaper for more detail]. S&OE, or Sales & Operation Execution, and Attribute-Based Planning, are the key to model accuracy and plans that are precise enough for visibility and execution.

S&OE

In the absence of an accurate representation (model) of the supply chain, it is impossible to make good decisions. Imagine having a blind, but a very intelligent, traffic cop directing the traffic at a major cross road. If he cannot accurately see how many cars are approaching, from which direction they are coming and clearing the cross road, size of the vehicles, their speed etc. how can he make a good decision let alone an optimal decision? Intelligence requires a thorough understanding of the environment, i.e. an accurate model built with S&OE and Attribute-based capability.

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