Takeaways from AIBP Insights Logistics and Supply Chain: Digitalisation for Resilient Supply Chains
Our AIBP Insights discussion on supply chain resilience among manufacturers in ASEAN featured perspectives from Bio Farma, BRAND’s Suntory, CP Foods, Dole Packaged Foods, Hijo Group of Companies, Integrated Micro-Electronics (IMI), Sinar Mas Agro (SMART), as well as Oracle.
AIBP Insights is a series of closed-door regional roundtable discussions which are part of our ongoing engagement with enterprises in ASEAN to look at topics affecting digital transformation for their businesses. The purpose is to enable the exchange of ideas between industry stakeholders and spearhead creative collaboration across industries and countries.
Key areas of discussion were changes to supply chains in the past year and creating resilient supply chains through digitalisation.
Setting the stage for the discussion, Irza Suprapto, Chief Executive Officer, Industry Platform, shared that manufacturers in ASEAN are looking to invest in digitalisation as the need to align production with demand in a timely manner has increased.
Sunil Wahi, JAPAC Head - Solution Engineering, ERP & HCM, Oracle, opened up the discussion about how an intelligent supply chain strategy can drive better operational visibility with the use of IoT-based and AI-driven applications for logistics and supply chains network monitoring and connectivity. He also highlighted that digital assistance is driving better customer service both in the b2c and b2b space.
Changes to Supply Chains in the Past Year: Managing Supply and Demand
The panel highlighted the shifts in customer demand patterns during and beyond the COVID-19 pandemic, and Nyoman Mahardika, SVP, Head of Supply Chain, Manufacturing, Caps Business & PMO Innovation, BRAND’s Suntory, summarised very nicely the key implications of these shifts for manufacturers - product optimisation and process optimisation.
Apart from managing demand and supply, supply chain management involves demand planning, production, supply planning, as well as the operations and logistics of the production process.
Thossaporn Petporee, SVP, Business Development, Digital Committee, CP Foods, and Sherwin Nones, Head of Strategic Planning, Integrated Micro-Electronics (IMI) both mentioned that they were prepared for changes and disruptions in supply and demand. As Thailand has experienced pandemics in the past, CP Food’s supply chain has been strengthened throughout the years. Sherwin also shared that as part of one of the most volatile industries, disruption in electronics manufacturing at IMI is commonplace and their business continuity plans kicked in automatically to address these disruptions.
On the other hand, for manufacturers who had to adapt to these unexpected changes, Alex Ustaris, Group CIO/CTO and Head of Shared Services Center, Hijo Group of Companies, Ronni Rombe, Director of Supply Chain, Sinar Mas Agro (SMART), and Kwan Manathat, Innovation Lead, Global Manufacturing, Dole Packaged Foods shared about their experience in adapting to these new situations.
Ronni observes that without a proper system in place, demand and supply data would be inaccessible. As there has been huge changes in demand both locally and internationally, he believes that visibility from the demand and supply side is crucial for demand planning and to quickly react to any changes. Likewise, Kwan mentions that as Dole Packaged Foods rely on agricultural processes which have to be planned in advance, it was difficult to immediately respond to increased demand for their products. The key was to increase automation in their factories as quickly as possible, and to localise production to meet demands internationally.
Alex also highlights that as more customer channels emerge, there is more information to obtain from different platforms - he observes that customers place importance on quality, competitive price points and delivery fulfilments. In response to meeting customer demand, he believes that it is important to collaborate within communities to drive business. This includes the sourcing of raw materials, partnering with and training local communities and small businesses in scientific methods of growing, harvesting and storing produce.
To these developments, Sunil highlights the importance of agile adoption of the right business processes and customer experience in ecommerce initiatives in helping manufacturers to scale.
Creating Resilient Supply Chains with Digital Solutions
The panel shared about the various initiatives that their supply chains have undertaken to create resilience within their respective industries
With regard to factory and supply chain monitoring, Alex shared that periodic virtual quality checkpoints were established for the construction of their smart factory. In a similar vein, Nyoman highlighted the importance of digitalising their factories, processes and middlemen. He believes vendor managed inventories will ensure that b2b and b2c demands are met.
In addition, he mentioned that digital twinning will enable autonomous factories, and will be able to predict machine breakdowns and maintenance needs to reduce planned and unplanned downtime. However, the majority of the panel agreed that digital twinning technology is expensive and very data intensive, requiring existing systems and platforms to communicate. Along with Nyoman, Sunil, Sherwin and Thossaporn agreed that piloting processes before scaling and rolling them out is key.
For CP Foods, Thossaporn highlighted that food is a matter of national security, and the company must be well-prepared for supply chain and logistics disruptions. A key factor was to protect their farms, factories and livestock. Thossaporn shared about how they worked to ensure veterinary services and animal feed availability through chatbots and online portals. Another important consideration was the health and safety of their employees. The food manufacturer employed technologies like biosecurity and AI to monitor employee movement, which were deployed to smaller farms as well. Sunil also observed that investments in the areas of employee health and safety have also increased among enterprises.
Likewise, IMI seeks to ensure the safety and environment of their workers. Sherwin also goes on to highlight the importance of having a local, regional and global view of the supply chain. He shared that support systems are set up to ensure availability of electronic components. Data analytics is incorporated to allow for predictive analytics, faster decisions and simulation of processes to enable any required action.
For Bio Farma which will be rolling out COVID-19 vaccines in Indonesia, their key challenge will be to ensure the quality and quantity throughout vaccine distribution. To do so, Ervan Suryadi, VP Digital & IT, Bio Farma, shared how IoT, sensors and GPS systems will enable monitoring and tracking of their vaccines. Sunil mentions that pharmaceutical companies will benefit from employing solutions like IoT, fleet management and digital health records.
Concluding the discussion, the panel shared some final thoughts on considerations for digital transformation.
Sunil shared that their biggest requirement from their clients was improving time-to-market - being able to optimise demand and supply in an agile manner. Sherwin highlighted that digital transformation is about leveraging technology to create new models that will add value and set up new areas of revenue, as well as the importance of the human component - our ability to design, collaborate, cope, and thrive in times of disruption.
We will continue the conversation next week at AIBP Insights Manufacturing. Stay tuned for the upcoming AIBP Insights Manufacturing, Government, and Banking and Finance which will be held in the coming weeks. Do reach out if you wish to find out more about and be a part of our upcoming sessions!