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Perhaps only matched by the impact on the sales function, the spread of COVID-19 significantly disrupted supply chains globally. That impact has been felt in several ways, including:

  • Weakening demand in many situations
  • Simultaneously, skyrocketing demand for select companies
  • Creating uncertainty in obtaining raw materials
  • Impacting the ability to ship and receive products on time due to shortages and logistics bottlenecks or border restrictions
  • Challenges in workforce capacity to assemble and ship products

As a result, more than 90 percent1 of the Fortune 1000, including many technology companies, have suffered supply chain disruption. But how do you make supply chains future-resilient in this new reality?

Adding resilience to the existing cost imperative

Clearly COVID-19 has cast light on the urgent need for more robust global supply chains, in order to weather unforeseeable disruptions in the future.

The opportunity to reset

Despite its negative impacts, the pandemic has given businesses a rare opportunity to reset. For many, it will be the catalyst to implement the change they needed. Now is the time to put a relentless focus on the customer centric, data enabled, digital technology that many companies had intended to implement prior to the pandemic, but deferred due to fragmented efforts, legacy systems, or other factors.

“The supply chain mantra is changing from efficiency and low-cost country or territory sourcing, to supply chain resilience and visibility to reduce complexity and uncertainty,” Henry Brunekreef, Director, Operations Advisory and National Leader, Supply Chain Management, KPMG in Australia explains. “The acceleration of digital transformation is key to that new way forward.”

So, what is a future-ready supply chain?

Future-ready supply chains are customer-centric, can operate in the ever-changing digital world with agility and do so profitably in order to be a revenue driver for the business.

Future success for supply chains depends upon being purpose-built and built to last. To help achieve operational success, KPMG Powered Enterprise | Supply Chain (Powered Supply Chain) includes a pre-built operating model based on six ‘layers’ of change. It helps organizations make an operational re-set and use cloud as a transformation opportunity, on their technology platform of choice.

As part of Powered Supply Chain, the KPMG Target Operating Model, has pre-configured processes behind each of these layers:

  • The overall functional process: within this layer sits the hundreds of predefined processes for finance, HR, IT, customer operations, procurement, supply chain, cyber and risk.
  • People: containing aspects of an organization’s supply chain workforce. Upskilling employees for the digital age is an essential part of building supply chain resilience.
  • Technology: there are several approaches and technology solutions that can be used to provide precision visibility into supply chains. These include advanced tracking and tracing predictive analytics, cognitive decision centers, and intelligent automation. Each of these, when deployed correctly, can streamline processes and change the fundamentals of supply chain management.
  • Performance, insights and data: includes tracking KPIs, process performance indicators and enhanced reporting beyond the vendor supplied reports to satisfy your organization.
  • Governance: addresses the risks involved in the supply chain process, as well as the segregation of duties and policy identification.
  • Service delivery model: addresses the overall architecture of the delivery model, from what extent processes should be centralized, to a shared service center, centers of excellence and outsourcing operation models to help optimize service delivery.

Why KPMG Target Operating Model?

Powered Supply Chain solution guides you through your end-to-end transformational journey. At the heart of it, the KPMG Target Operating Model shapes your business transformation and helps you map out the optimum way you can operate in the future. Its real power is to help you get to where you need to be with lower risk, but also sooner, so the benefits can be realized earlier.

By working with Powered Supply Chain for your supply chain business function, you can also overcome the traditional shortcomings of a complex cloud transformation project by being able to validate the decisions you make along the way.

Powered Supply Chain is a strategic approach to transformation that offers the agility required for dynamic evolution. What you build today will become a solid foundation and context for what you may need tomorrow. The opportunity is now to create a seamless, flexible supply chain to not only survive but thrive in potential future turbulent times.

Learn more about KPMG Powered Enterprise and how the KPMG Target Operating Model can transform your supply chain into a resilient supply chain of the future. 

Learn about some of the benefits you can experience through digital adoption and transformation.

Footnote

  1. Sherman, Erik. "94% of the Fortune 1000 are seeing coronavirous supply chain disruptions: Report." Fortune. 21, February, 2020

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