Does concurrent planning in the supply chain work?

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As the COVID-19 pandemic continues and businesses attempt to respond more effectively to its disruptions, a concurrent approach to supply chain planning can enable greater agility.

Some experts say a concurrency planning approach could help businesses during small-scale crises, like machine breakdown, but it hasn’t reached its full potential as a way to deal with more serious situations. such as natural disasters.

So, does concurrent planning in the supply chain work? Here is a glimpse of his current reality.

What is Concurrent Scheduling?

Concurrent supply chain planning links short-term execution plans to a longer-term business plan. When a user establishes a new short-term plan, the short-term plan is immediately linked to the goals of the longer-term plan, potentially increasing an organization’s agility. Users from different parts of the organization can see the latest relevant business data and make decisions based on it.

Creating a horizontal and vertical supply chain model is also important for successful concurrent planning.

Concurrent scheduling can potentially help reduce costs and improve response time. However, its promise does not always match its reality.

In theory, concurrent planning can lead to significant improvement in supply chain accuracy, visibility, resiliency and agility and lead to improved cost, quality, speed and responsiveness, said Bill Huber, digital platforms and solutions partner at ISG, a global technology research and consulting firm based in Stamford, Connecticut. Given that supply chain costs can constitute 70% of total costs for manufacturing companies and those in other industries, the potential impact of concurrent planning is huge.

However, executing concurrent planning effectively is often easier said than done, he said. Supply chain technology can vary greatly in sophistication. Concurrent planning participants attempt to successfully interact different types of technologies, which can include everything from a spreadsheet to an embedded system connected to sensors. This can lead to significant gaps in tracking and data reporting, making data science difficult to perform. Updates and delays may also occur.

Advances in AI and machine learning will be critical to the evolution of concurrency planning, as the vast majority of supply chains are far too complex for concurrency planning to reach its potential today. did he declare.

Potential Concurrent Scheduling Scenarios

Some experts are split on whether concurrent planning could help companies deal with natural disasters, which are a major concern for any organization as climate change continues.

Concurrent planning can potentially make a supply chain more agile, which could help during a pandemic or weather event, such as a hurricane or tornado, said Josh Nelson, director of strategy and operations at The Hackett Group, a Miami-based management consulting firm. A business can use concurrent planning to perform scenario analysis and better manage peaks in demand or disruptions in supply.

Additionally, the reduced planning cycle time of concurrent planning allows companies to make decisions faster in these situations and better capitalize on market opportunities, Nelson said.

However, some experts say simultaneous planning may not yet help during weather events.

In theory, if a company’s supply chain partner in another region experiences a natural disaster, the concurrent planning approach could improve that company’s response, Huber said. The reality is a little different.

Yes [a] the machine will be shut down for eight hours… simultaneous planning will allow the company to immediately see what its options are and make the best decision.

Tim PayneAnalyst, Gartner

“True Simultaneous SCM [supply chain management] will not be feasible in most cases at this time,” he said. “What is achievable is [the] modeling the probabilities of different scenarios, [which] will enable better contingency planning.”

Some experts say concurrent planning can help now with smaller-scale crises.

For example, if a machine in a company factory breaks down, concurrency planning could help, said Tim Payne, an analyst at Gartner, a research and consulting firm in Stamford, Connecticut.

“If the machine is going to be down for eight hours…and the business needs to rebalance some inventory throughout the supply chain, concurrent planning will allow the business to immediately see what their options are and take the best decision,” Payne said. “So you can use concurrent planning in any circumstance, big or small, where you see changes or events happening either on the demand side or on the supply side.”

Simultaneous planning technology

Like concurrent scheduling itself, concurrent scheduling technology may have a long way to go before it achieves its goals.

Organizations must come to terms with the fact that concurrent scheduling technology is always evolving, Huber said. Technology will likely first enable better concurrent planning within a company. Next comes better concurrent planning between suppliers, customers, carriers, and third-party logistics providers.

Interoperability will be key.

“Solutions will need to be omnichannel,” he said. “Existing SCM, transportation management, customer relationship management, enterprise resource planning and other software will be part of the solution.”

But, either way, users should expect significant upgrades to their existing suites and the integration of new products and technologies, he said. These range from sensors and meters to installing mobile computing to increasing migration to the cloud.

How Concurrent Planning Can Help Organizations

In some cases, moving to concurrent planning is already helping companies predict disruptions.

During the pandemic, Cascades Inc., a paper and packaging company in Kingsey Falls, Quebec, Canada, used Integrated Business Planning (IBP) software as a concurrent planning tool.

About five years ago, Cascades started using SAP’s IBP tool in its fabrics division, which serves North American retailers, said Isabelle Leclerc, vice president of supply chain at Cascades. Cascades then rolled out IBP, which SAP says is its concurrent planning product, across all of its divisions in 2019. The company wanted a tool to connect all of its sales and operations planning processes.

Cascades also hoped that SAP IBP would help support monthly and weekly planning processes and allow employees from various business units to more easily collaborate and resolve issues.

IBP has given Cascades greater business visibility during the pandemic, and the tool’s data and forecasting capabilities have helped the company make more informed decisions, Leclerc said. Data and forecasts also helped Cascades react quickly when product demand changed.

For example, Cascades’ fabrics division serves retailers and what the company calls “out-of-home” areas, such as schools, hotels and conference rooms, Leclerc said. During the pandemic, out-of-home demand has declined and retailer needs have increased dramatically. When a new wave of COVID-19 occurred, Cascades was better prepared as IBP helped the company anticipate this change and respond to retailer demands.

“This [forecasting] would not have been possible without simultaneous planning,” said Leclerc. “In the past, we only had bits of information, but you would never have the whole story. Thus, with IBP, we have a complete and transparent view of the supply chain.”

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