Supply Chain Resilience: Alert and Warning Systems

Check out Part 1, Part 2 and Part 3 of this series.

Affecting a state of true supply chain resilience requires a continual monitoring and managing effort. It is not just a question of optimal supply network design. One example of an alert and warning system suggested by the World Economic Forum Report is SAP Supplier InfoNet, a solution we’ve covered on Spend Matters in the past (but more on this in a minute). The report summarizes InfoNet as a system “that crowd-sources supplier information from over 13,000 sources. But InfoNet is more than that – it includes direct systems-based information from participating member companies (e.g., supplier performance, quality, on-time-delivery and related information).”

The report is correct in noting that InfoNet and predecessor systems (e.g., Open Ratings, now part of D&B) can “predict future performance and proactively manage” supply continuity. Moreover, “supply chain risks manifest themselves at the systems level, but their triggers tend to have detectable epicentres at the operational scale, e.g. a significant drop in supplier production quality. The abundant and accessible operational data can be better analysed to not only detect distress signals but also envisage the wider implications of disruption, enabling supply chain managers to coordinate a pre-emptive response.”

Said more simply, early warning (based usually on a combination of factors) is invaluable. We believe that the concept of SAP Supplier InfoNet is ingenious and SAP is in a better position than information-only companies to make wide adoption a reality, thanks to systems integration requirements.

At its core, “InfoNet is geared around the construct of a social network, not just an enterprise performance management or front-end BI interface. It shows, for example, ‘which suppliers I’m following.’ On top of this, it layers the capability to manage alerts, suppliers, explore your supply chain network (at multiple tiers) and analyze network performance.”

In deployment, “tabs enable users to select how they want to visualize their supply base, manage suppliers, view suppliers and select those they want to pay attention to. When it comes to the type of information InfoNet tracks, companies can get quite granular. For example, in the quality area, organizations can track quality at specific levels based on what they define in their systems including KPIs and metrics such as defective parts per million (DPPM), lot acceptance rates (LAR), fill rates, basic lead time, On-Time-Delivery (OTD) cycle time, etc. Individuals can then set alert bands (e.g., red, yellow, green) based on what they deem to be acceptable levels for different metrics or KPIs based on supplier performance across the network.”

Hugely powerful stuff. But don’t take our word for it. Check out a demo of InfoNet to see the future of alert and early warning systems in practice today, albeit in limited deployments.

Spend Matters readers can download the following briefs from our Research Library (free with registration):

Supplier Information Management Technology Fundamentals – Part 1

Supplier Information Management Technology Fundamentals – Part 2

Supplier Lifecycle Management: Reduce risk, Improve Performance and drive Supplier Value

Leveraging Supplier Management Platforms for Multiple Goals: Risk Reduction, Supplier Diversity and CSR

Supply Risk Management – Segmenting the Technology and Content Landscape and Choosing the Right Category of Solutions

Beyond Basic Scorecarding – Supplier Performance and Development Approaches to Drive Competitive Cost and Risk Advantages

Supplier Management Market Observations: Recent Trending, Musings on SAP’s Core Offering and General Deployment Pitfalls (for all Solutions) to Avoid

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  1. Jon Bovit:

    Thanks Jason. Love the topic and blog. If readers are interested in global supply chain disruption event monitoring, suggest checking out and subscribe to sample alerts via our home page:

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