162 Macro events such as the pandemic, the rapid growth in e-commerce, financial turbulence and geopolitical instability have created unusual fluctuations for supply and demand over the past couple of years, exposing critical vulnerabilities across the global supply chain. For example, Forrester’s 2021 The Digital Commerce Imperative report indicated that 49 per cent of respondents faced longer fulfilment times while 45 per cent had experienced shortages of raw materials. To remain profitable and meet customer demand, retailers and consumer goods companies (CG) must quickly stabilise supply chains and ensure they are agile, flexible and secure to ensure they can rapidly respond to changes in demands in future. According to Microsoft’s general manager supply chain for worldwide retail Mike Bassani, resilient supply chains must have three key components. “A robust and durable supply chain needs to be modular, interoperable with source systems, and secure,” he says. “The days of retailers explicitly relying on lean principles are mostly gone. Aside from a few areas (and available capital is always a consideration) the service level agreements they are looking to achieve for their customers are (once again) driving operations decisions. “Securing both data and intellectual property is becoming more critical and must be embedded into resilient supply chains. Firms that have made software technology investments are creating separation here. Unfortunately, however, the pandemic demonstrated that many companies have inadvertently backed themselves into a corner by relying on source systems and Excel and they are unclear where to start when it comes to moving from on-premises systems to the cloud.” One of the common barriers for transformation is that retailers have difficulty securing leadership buy-in for the necessary technology investments. “The ROI of Supply Chain Management, a 2022 Forrester report, found that supply chain management integration and configuration costs can be equivalent to 200 per cent of the firstyear licence cost,” says Bassani. “The investment perception can scare many organisations away from starting a supply chain management transformation; this puts them further behind.” Another frequent issue is that many retailers and CGs still use static, rather than real-time reporting, Microsoft’s Mike Bassani shares how retailers and consumer goods companies can combat the inadequacies within their current supply chain architecture to ensure they can rapidly respond to future consumer and market demand BY R E B E CCA G I B SON F E ATUR E Boosting supply chain resilience
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