Exploring modern supply chain management in a VUCA world

Modern supply chains in today’s world pose significant challenges. In the last few years, we have seen the global economy go through turbulence, with inflationary pressures and manufacturing slowdowns affecting supply chains worldwide. To navigate these complexities, supply chain resilience, and adaptability are crucial. In this interview, with Vikas Kalra, Associate Vice President – Supply Chain, Hindware Home Innovation Ltd., we delve into strategies for ensuring supply chain resilience and discuss the integration of new technologies, such as generative AI, to manage complex operations. We also explore the importance of omnichannel retail in optimizing supply chains and the integration of sustainability practices to meet evolving customer expectations. Read on for more.

Heading modern supply chains in today’s VUCA world comes with its own set of challenges. How do you ensure supply chain resilience and make your supply chain adaptable to changing market conditions and disruptions?

We are living in a VUCA world where business is being done with a high risk of volatility, uncertainty, complexity, and ambiguity. World Economy is going through a tough phase for the last cou[1]ple of years and most of the world’s largest economies are facing the pressure of high inflation.

Manufacturing from the US to Asia is very much in a slowdown phase as factories continue to struggle with supply snarls, labour shortages, and elevated materials costs. Some economists are even predicting a recession in large parts of the globe. Due to these challenges, Supply chains are also getting impacted & are becoming extremely complex and more challenging than ever.

We are taking below few steps in the supply chain to manage and sustain ourselves in this VUCA world:

• Predict the atmosphere

• Forecast the demand by business intelligence

• End to end Supply chain visibility

• Use data to optimize and synchronize the supply chain

• Supply Chain agility by working on various aspects of sched[1]uling, material handling

• Using data and applying various data analytics techniques.

• New technology implementation and engage supply chain partners.

Focusing on Supply Chain visibility, which requires supply chain integration with both internal partners (allied functions) and external trading partners (contract manufacturers, suppliers, transportation carriers, and logistics providers) is now becom[1]ing a critical competency. But before a company can collaborate or partner with others to reduce pipeline inventory or landed cost or improve lead times, it needs to have end-to-end supply chain visibility as well. These days most organizations are not only looking for safe and timely transportation of goods but also looking forward to getting end-to-end logistics solutions that can add up value for a shipper.

While planning any delivery in a supply chain, simple cost quotation and expected delivery time information with a click of a mouse can help in quick decision-making. Most organizations are focussing on digitization to mitigate supply chain risks in the VUCA world.

A critical aspect of supply chain management is cost optimization. How can one effectively manage costs while maintaining high service levels? Can you share some cost optimization initiatives you have implemented?

These days, companies are facing an increase in logistics costs as post-pandemic most of the organizations are trying to reset their supply chains and rebuild inventories amid continuing disruptions. To overcome these supply chain challenges, most organizations have started investing in the digitization of their supply chains. I think digitization infusion in the supply chain will pick up pace radically over the next few years as most organizations are betting big on this.

In the last few years, companies, across the globe, have understood the potential of cloud-based supply chain solutions and their acceptance is increasing with every passing day. We are also investing a lot to digitize our supply chain and it is helping businesses in a big way as this will help to improve operations and cost efficiency across the value chain. In addition, such cloud-based supply chain product suites are helping organizations achieve business continuity from anywhere. With the implementation of such product suites, we get a certain amount of scalability, Flexibility, agility, and improved efficiency.

Digitization of the transportation value chain is very important for any manufacturing and distribution company. Such tools will not only help our supply chain and warehouse teams to do effective transport planning but also improve logistics efficiency across the value chain. Post implementation, we will be able to collaborate with our external stakeholders like transporters, freight forwarders, and CHAs in a much more effective way on a real-time basis. Multimodal networks, warehouse automation & E auctions are a few other levers that are being used by organizations to optimize supply chain costs.

Cite the importance of omnichannel retail in optimizing your supply chain to support evolving customer expectations. How can one design a supply chain that supports seamless integration between online and offline channels?

Large e-commerce companies like Amazon, Flipkart, Shopify, etc. have changed the paradigm of Indian businesses. New-age trade has evolved over the last few years in India with the adoption of new trade channels like General Trade, Modern Trade, Ecommerce marketplace, etc. At the same time, Customer’s expectations have also evolved in last few years and they want order to be delivered at a quicker pace for which they are ready to pay extra as well.

The role of supply chain in an omnichannel business model is very important as each stakeholder in complete value chain need to work consistently and seamlessly to meet the customer demand. To have integrated supply chain in an omnichannel business, it becomes imperative to remove operating silos that exist between different sales and distribution channels. This means combining different sales and operation systems or merging warehouse or fulfilment operations can help to serve both online and in-store requirements on time.

Assigning a wrong stocking strategy or variability in demand at one channel may result in stock out which results in customer dissatisfaction. Prioritizing the demand of one channel can also disrupt your supply chain. Moreover, it is difficult to optimize omnichannel value to customers without clear visibility across the supply chain.


This is an abridged version of the final interview published in the August edition of the Logistics Insider Magazine-India. To read the complete interview, click here.

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