Daily Archives: May 16, 2024

Another Supply Chain Misconception That Should Be Cleared Up Now

Yesterday we discussed one supply chain misconception that should be cleared up now because, despite all of the misconceptions mentioned in an Inbound Logistics Article, it was not addressed. However, there is a second misconception that is almost as critical that was not addressed either, so today we will address it. And while, there are, dozens of common misconceptions (including the 22+ mentioned in the article), these are the two that are the most critical to understand, as they are two that pose the most risk in most of today’s Procurement organizations.



Supply Chains Have Reached (A New) Normal

Supply chains have never been, and will never be, normal as they will always be in flux due to perturbations, delays, and disruptions that happen daily. You may not see all the trial and tribulations a third tier supplier goes through every day, but trust the doctor when he says they have just as much turmoil as you do. Nothing is predictable in supply chains. When you accept this misconception in conjunction with the first misconception, it’s easy to see how almost all of the others are also misconceptions (that highlight slices of the bigger misconceptions).

For example:

  • cost becomes much less important than supply assurance due to the unpredictable nature of supply chains
  • since it’s not a linear, closed, model, zero-sum doesn’t apply
  • we made up the stages of planning, buying, transportation, and warehousing silos to fit a theoretical definition of normal that doesn’t exist
  • there is at least a hand-off at every stage, so the process is not disconnected but linked, if not intertwined
  • etc. etc. etc.

When you accept the reality, Supply Chain Management, as well as Source-to-Pay, will become a lot easier to manage because you will realize that

  1. only human expertise can adapt to new situations and find real-world solutions to the new challenges that arise
  2. technology will allow you to automate the tactical / semi-normal operations and instead focus on the exceptions and challenges, making you more productive as you focus the majority of your effort on strategy and thinking vs (e-) paper pushing and thunking which is the only thing the machine is good at (and, based on current technological understanding, ever be good at — which is exactly why we can limit it to the thunking because it can do over 3 Billion calculations a second flawlessly [if we ditch the “AI”] while we struggle to do 3)

In other words, only intelligent, adaptable, humans can manage constantly changing supply chains. Good technology can alert them and give them the intelligence they need to make good decisions, but technology cannot make those decisions for them.

(And the doctor, who dreaded saying Bye, Bye to Monochrome UIs can’t wait for the day he can say bye, bye Gen-AI.)