The Supply Chain Shaman, Lora Cecere, always has something interesting to say and valuable to think about.
Her numbers show that supply-chain related firms are right now simply making incremental improvements on existing systems, and are ignoring the need to go out there and find new ways of gathering and making use of supply chain data.
Systems people for years have known that you have to re-engineer the processes, the ways of doing business, and the software must support that. While it may turn out that the software is already right to support new processes, it’s much more likely that entirely new forms of software are required for the processes to work properly and fluidly.
That means analysts and business process participants together must spend the time needed to truly understand what they need to accomplish, and put in the up-front research and planning to get the system designed well. Few companies are willing to tolerate the time required. But that’s where the true value is realized.
I was just reading an article that tried to set forth a design strategy for a Port Communication System for ports in South Africa. Currently they don’t have them. But the article was at such a high-level that there was no insight into the new procedures and methods that would be needed to really bring these ports into the 21st Century. I’m afraid that much development of supply chain systems is done in that way. We look at existing processes instead of imagining how the processes and the whole scenario could be different. And once we’ve imagined the new world, we can see that the systems have to be different.
So the message to supply chain firms is to put on your imagining cap and plan systems that actually make quantum improvements; done just band-aid the old processes.
WRITTEN BY LORA CECERE• NOVEMBER 3, 2021• 3:04 PM• ANALYTICS, BIG DATA SUPPLY CHAINS
Gene Seroka, Executive Director of the Port of LA, is calling on people to cooperate and share data on logistics activities. He wants to see a bold information transformation, for the maritime industry and also for on-shore logistics. He was put in charge of coronavirus-related logistics by the Mayor of Los Angeles, a very big job in addition to his own.
In the video you get to hear him directly.
He makes great claims for the Port of LA logistics information systems. But the port has needed to be dragged kicking and screaming into the digital age. It’s taken much longer to get them to act than it had to. Scholars and also logistics participants such as forwarders, shippers, and NVOOCs (Non-vessel-owning ocean carriers, sort of freight forwarders for ocean cargoes) have been screaming for coordination of systems ever since the 2000’s. It’s just very hard to do without standards. And it takes forever to negotiate standards that don’t place some participants at a disadvantage.
The role of standards could be a lot like their role in the PC market. Used to be, when you bought a PC you had to buy the disk drive, and memory from the same vendor– it had to be compatible. Software also must be compatible with the operating system. Nowadays, these parts are made to standards, and you can go buy any replacement or upgrade memory or disk that are compatible, You can even replace your hard drive with a matching SSD that is transparent to the computer. The adoption of standards allowed computers to become affordable, software to work on all the hardware, and be useful for all. It’s called a network effect. The same is true for logistics software. To connect partners together they need to each conform to standards of data structure (schemas, we call them) and standards of transmission. Nowadays the buzzword for this is APIs, but the concept has had lots of names over the years. My favorite was ‘middleware’.
And the need to share has to be seen by the prospects as more important than preserving the confidentiality of their company data. That is perhaps the largest barrier. So participants have to see tangible economic benefits to sharing, and that is sometimes hard to get direct evidence of. Even the economic network effect is hard to justify economically with hard numbers.
Gene Seroka is a good leader, and for coronavirus, we hope he is able to pull together what’s needed for the job.
Kim Link-Wills, Senior EditorWednesday, September 16, 2020