E2E Supply Chain Ecosystem Transformation Survey

Companies with mature supply chains are continuing to transform without hesitation. But companies that have failed to invest in their supply chain for years are struggling. They understand that transformation is necessary, but where should they start? And in which direction should they steer their organization? Four participants in the E2E Supply Chain Ecosystem Transformation Survey share their experiences.

When the pandemic broke out in early 2020, technology company Bosch decided to set up a company-wide supply chain task force. Bart Meers led the team with the aim of proactively addressing bottlenecks and preventing negative impact on customer deliveries. “The first challenge in setting up such a task force is appointing the right people. Not just people from logistics, but also including people from purchasing, production and sales. Preferably generalists who have knowledge across all those three disciplines,” says Meers. Today, he is responsible for logistics and warehousing for the Bosch Group’s BSH Home Appliances division.

The second challenge is equipping the team with the right tools and technologies. “During the pandemic, we were in a better position than our competitors to proactively address bottlenecks. Partly because Bosch could use suppliers” part numbers to quickly identify which customer orders would be affected by an impending parts shortage,” Meers explains. “In addition, we were able to create one safe source of truth. A single, uniform, reliable source of information is necessary to communicate transparently with all stakeholders and make the right decisions.”

So when is such a task force needed? When answering this, Meers distinguishes between white, grey and black E2E Supply Chain Ecosystem Transformation Survey Supply chain transformation requires clear strategic vision swans. By white swans, he means events that have been announced in advance, such as Brexit or the US elections. “Those are the events we can prepare for and for which we do not need a task force,” Meers states. “In contrast, companies do set up task forces for grey swans: events that we know could happen one day, but which cannot be predicted. Think of pandemics, an earthquake or the escalating conflict in the Middle East. The same goes for black swans: rare events that no one could have foreseen.”

Grey swans

Actually, there should be no immediate need to set up a task force for all grey swans, Meers claims. “We know very well which regions are prone to earthquakes and which suppliers are located there. We can figure out in advance what measures to take if one of those suppliers is put out of action. By incorporating some of the processes, tools and competences of the task force into the line organization, we can handle such disruptions without setting up a special team. That helps to make the supply chain resilient.”

After disbanding the task force, Bosch did indeed integrate a number of processes and methodologies into the line organization. “Now, when we see that the availability of certain raw materials or components is coming under pressure, we try to secure supply with longterm contracts. Or we try to redesign our products featuring components that are available in sufficient quantities.”

Ecosystem

Due to geopolitical conflicts, new trade barriers and climate change, the number of grey and black swans has increased significantly in recent years. Like Bosch, many companies have been forced to embark on a transformation and improve their supply chain resilience. That transformation is not just limited to their own organization, but extends to the entire ecosystem in which they operate. “Many supply chain leaders realize that they need to look beyond the four walls of their own company, towards suppliers, customers and other supply chain partners. How can they get a better view of everything happening in the ecosystem that impacts their own supply chain?,” says Kristof De Coster, Vice President Supply Chain Excellence Northern Europe at consulting firm Efeso.

Such companies regularly approach Efeso, asking how to set up such a transformation. “Ecosystem transformation is the next step towards a more mature supply chain,” De Coster comments. “But we see many companies struggling with this transformation. Apparently, there are all kinds of factors or circumstances that prevent companies from taking the next step. We want to know what they are. That was the reason for us, together with Supply Chain Media, to ask almost a hundred supply chain executives about their experiences with supply chain ecosystem transformations.”

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