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The ongoing market volatility and uncertainty aren’t letting up. More complexity reduces visibility and control while adding cost and risk. Inflation, tariff, compliance and talent shortages compound planning uncertainty. Supply chains need to integrate and collaborate with end-to-end partners and vendors in a more efficient, orchestrated, always-on model.
Here are five key benefits from supply chain orchestration, plus what to look for in a partner:
1 Connect the Entire Ecosystem
Within most supply chains today, strategy and decision-making is more centralized, while the data to support decisions remains fragmented.
Upstream and downstream partners or vendors aren’t necessarily integrated with customer enterprise resource planning platforms. Within supply chain organizations themselves, divisions typically operate independent of one another with discrete data sources, software systems and manual processes.
All of that walled-off data across the end-to-end supply chain limits crucial visibility. As complexity increases, workflow and decisions slow down.
“The challenge most companies face,” says Tony Harris, head of marketing and solutions for SAP Business Network, “is that their systems are really designed to manage processes inside the four walls of the business. They’re not designed to have external parties like suppliers inside that system as an extension of their own network.”
Real-time sharing of critical data automates and accelerates routine processes, reduces errors and frees up finite talent for higher-value work, with sensitive data protected by clear permission structures. As platform provider networks expand, new opportunities are created to connect and collaborate beyond the originating supply chain.
2 Gain Deeper Insights From a Wider View
Supply chain ERP systems generate massive volumes of planning, forecasting, order, manufacturing, logistics, inventory and other data. Structuring and standardizing that data for real-time access and sharing across a multi-tier network, supported by contextual market, geographic, risk and other data, creates a powerful set of decision-making and orchestration tools.
Artificial intelligence will play an important role in these new networks, adding both computer processing power and inference for analytics to build a more accurate, granular picture of system operations. This can include “hypersynthetic” data that uses advanced simulations that model complex real-world systems and fill in relevant forecasting detail where data gaps may exist.
“If there’s a disruption, or the risk of one, like announced tariffs that may or not happen, that uncertainty forces me to decide: Am I changing my suppliers, my manufacturing network, my forecast, my pricing strategy?” says David Vallejo, SAP vice president and head of global digital supply chain. “But now all of that is informed in real time, instead of being a multi-week research project, or a decision made based on intuition.”
3 Move Fast Without Breaking Things
Agility isn’t just about speed; it’s about the capability to turn on a dime, make complex decisions and course-correct quickly when day-to-day conditions abruptly change, or as major, longer-term market shifts emerge.
The key is an always-on, real-time view of the end-to-end supply chain, instantly accessible to, and shared by, all relevant partners in user-friendly dashboard visualizations. A single, shared view builds trust in the data and inspires collaboration to seize opportunities and solve problems. For big decisions, like selecting new suppliers, reshoring and onshoring, adding a new manufacturing plant, or launching a new product, a human ultimately makes the decision, guided by generative AI. Smaller, labor-intensive decisions that are often manually done can be automated.
4 Stay Resilient When Down Is Up
The COVID-19 pandemic upended the entire legacy supply chain model over 2020 and 2021. Sales of suitcases abruptly stalled, for example, while workout equipment, cosmetics and baking ingredients flew off the shelves. Warehouses full of restaurant-grade paper napkins were quickly repackaged and shipped as consumer-grade product vanished.
Since COVID has receded, new pressures have quickly replaced it: an overnight retail inventory backlog from spiking interest rates; tough, sudden decisions about sourcing, nearshoring or reshoring, and compliance costs. Who has time for traditional forecasting? Why even bother?
“It’s now all a probabilistic risk model,” Vallejo says, “using operational data from the multi-tiered network to guide decisions that won’t be based on a deterministic yes-or-no assessment of what will happen. They’ll be based on my tolerance for risk: revenue risk, cost risk, business continuity risk.” Making that calculation takes more than the right software model; it takes a robust network and complete data.
5 Manage Sustainability and Other Compliance
While public controversies ebb and flow, companies accept the economic realities of sustainability. Fuel and materials costs are rising, and waste is money left on the table. Consumers value less packaging and obsolescence in their products and less carbon in their deliveries.
“At the end of the day, I think companies are more focused on sustainability costs,” Harris says. “With their businesses under massive cost pressures as things like tariffs also kick in suddenly, sustainability projects suddenly fall by the wayside. Customers are looking for help with some of those initiatives, without having to bet the farm on it.”
Sustainability measurement and reporting impose complex compliance demands. So do tariffs, trade sanctions and cybersecurity. Data sovereignty is also a growing source of compliance requirements across Europe, the Middle East and other regions. Non-compliance risks range from customs delays and fines to criminal penalties, potential reputational damage and lost business.
Managing the different compliance layers demands involves continuous, secure system monitoring, and n-tier supply chain risk and resolution software solutions for each compliance type. These tools track risk signals from a variety of external data feeds to sense compliance exceptions as defined in the system business rules.
SAP Helps to Connect the Supply Chain Dots
SAP, established in 1972 in Waldorf, Germany, is a leading provider of enterprise resource planning software. Its SAP Business Network, the world’s largest B2B platform, supports $6.3 trillion in annual commerce. The network’s Supply Chain Collaboration application connects multi-tier supply chain partners for real-time visibility and collaboration.
Trading partners gain forecasting visibility, enhancing agile planning. The platform accelerates workflow with digital purchase orders and shipping documentation. Transparency enables supplier-managed inventory for improved speed and accuracy. Additionally, the network includes a trading partner directory for clients to connect with potential partners outside their immediate supply chain, enhancing resilience and risk management.
SAP’s Supply Chain Orchestration solution integrates data from SAP Business Network and SAP Business Data Cloud to link trading partner data with ERP systems. Leveraging AI, it detects disruptions, contextualizes risk, and recommends actions across the supply chain. Together with SAP’s Supply Chain Management solutions, SAP Business Network helps companies build robust supply chains and deliver high-quality products on time.
Resource Link: Supply Chain Management (SCM) Software Solutions | SAP
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