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Pandemic forces firms to modernize their supply chains
Live Mint

Posted: Sunday, May 17, 2020

Pandemic forces firms to modernize their supply chains

Prasid Banerjee

Companies are on a drive to look for technological solutions, both emerging and existing, to supply chain bottlenecks caused by covid-19 and the subsequent nationwide lockdown.

Prime Minister Narendra Modi called for the country to modernize its supply chain. “One clear trend I have witnessed is that clients who were already invested in technology are able to manage the current situation much better," said Ashish Nanda, supply chain leader, EY India.

The pandemic has set physical constraints, and access to digital solutions allow firms to have visibility not only within their organizations, but across the value chain, said Nanda.

Traditional planning models do not apply due to the pandemic, said experts.

Companies could set forecasts for months in advance earlier, but now they have to work on real-time models. For this, traditional technology tools aren’t always feasible.

“What is happening now is that companies are investing in low cost add-ons or hold-ons, which are helping them monitor the constraints on a real-time basis," Nanda said, adding that emerging technologies, such as artificial intelligence and blockchain, will play a crucial role.

“Covid has taught us to look at new ways of patternization, understanding demand and supply and fulfilment," said Easwaran P.S., Partner, Deloitte India. “One of the big applications that’s coming up is artificial intelligence (AI) and cloud-based inventory optimization," he added.

Food products brand Parle and IBM are working together to create an “intelligent supply chain". They will make use of IBM’s Watson AI solution to predict demand, reduce time-to-market and right-size its inventory across the supply chain.

In the fast moving consumer goods (FMCG) sector, firms have rushed to tie-up with delivery platforms, such as Zomato, Swiggy and Dunzo, to ensure their goods keep moving. These firms traditionally depended on neighbourhood mom-and-pop stores to meet the market demand.

Big companies aside, digital transformation extends right to the lowest levels of the supply chain right now.

According to Pankaj Ghodde, CEO of Agro10X, he added over 100,000 new farmers to its platform in the past month-and-a-half. It had taken the platform six months to add the same number before the pandemic. “We had to actually put a load balance on our server because of the load coming from the platform," he said.

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