Achieving autonomous or “lights out” supply chain planning

Operating in the supply chain world, it’s hard to not come across terminology like supply chain planning 4.0, “light touch” planning or “lights out” planning. All have generated a lot of hype over the past few years … and for good reason.

Considerable progress has been made in technology in recent years, continuing at a dizzying pace. Autonomous development is happening in most major car companies with the promise of self-driving cars everywhere within a few years. We’re already seeing autonomous vehicles in use today in the supply chain, particularly in Western Australia’s mining industry.

So why shouldn’t we strive to achieve autonomous supply chain planning?

The momentum towards achieving this is gaining, but many technological hurdles must be overcome before the lights can be turned out, eliminating any human input. The problem solving and decision making capabilities of supply chain planning systems must improve upon human reasoning, judgement and creativity to resolve impediments to execution of solutions.

 

 Autonomous planning system requirements

For supply chain planning to successfully become autonomous, there are a number of key requirements. Operating globally necessitates “lights out” planning technology to have a flexible architecture, scalability and the ability for two-way interaction with hundreds of entities and sources. It also needs to have the ability to absorb and dissect significant amounts of data.

 The average supply chain professional will understand that older planning software they’re working with, such as ERP and advanced planning systems, can’t provide the requirements for “lights out” planning.

To fully automate any process, digitisation is required. The planning technology must know the steps, decision points and communication channels for sharing decisions and outcomes. This requires advanced analytics, automated execution, continuous self-learning, self-maintaining and flexible goal setting.

It also needs automated and dynamic problem solving and decision making, a common planning and analytic data layer, as well as a digital twin to model the supply chain planning process and the demand and supply plans.

 

“Lights out” planning is coming … over time

The good news is that we seem to be on the cusp of the breakthrough in autonomous supply chain planning software. Many of the requirements are already available or will be soon.

In the coming years we’ll see an acceleration in the availability of these types of functionalities. New autonomous planning categories will appear and grow into full scale supply chain solutions. Vendors will provide complete offerings that will support a roadmap towards autonomous supply chain planning.

Early adopters such as Merck KGaA’s healthcare division are already emerging. These are specific cases with a clear scope and in specific segments of the supply chain. Full, hands-off automation on a mass scale, however, is still some years away.

While we still have a long way to go, these are exciting times in the supply chain planning world. Autonomous supply chain planning is here, but some patience will be required before we can turn all the lights out.

This is a shortened version of my article first published in Foresight

Photo credit: aarp.org

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