Building supply chain resilience in the CPG industry
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Key Takeaways
⇨ The COVID-19 pandemic highlighted the critical need for technological partnerships in supply chain management to enhance performance, predict disruptions, and ensure operational sustainability.
⇨ Digital transformation, including predictive maintenance, product lifecycle management, and AI integration, is essential for CPG companies to create resilient, responsive, and agile supply chains.
⇨ Joint business planning and real-time data sharing among all parties in the supply network are crucial for effective demand forecasting and inventory management in the CPG industry.
The COVID-19 pandemic changed the way the world viewed supply chains forever. It brought to the fore the need for a robust technological partner to ensure that businesses can improve their performance by helping to predict disruptions, eliminate silos, and strengthen their operational sustainability.
Still, some challenges such as data silos remain, especially in the consumer products goods (CPG) industry. According to NTT DATA Business Solutions, to be able to effectively run an end-to-end supply chain, all parties must work off the same data in real-time to overcome this issue.
Moreover, the CPG supply network involves the CPG company, its suppliers, distributors, and retailers. Thus, consumer product organizations need a supply chain that is resilient, responsive, and agile. To achieve this, companies must explore the often-untapped potential of digital transformation.
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Digital transformation can include predictive maintenance through machine learning scenarios, digitized quality control, utilizing agile product lifecycle management software, and cloud-based solutions for ensuring data accuracy in forecasting.
Joint business planning is another area that can strengthen a CPG supply chain. It includes collaborative demand forecasting and planning with suppliers, sharing demand and sales forecasts to help suppliers better plan their production and inventory.
Unlocking stronger supply chains
Demand forecasting is, in fact, a top area for analytics in CPG companies. Artificial intelligence (AI) is another growth area. According to a study by NTT DATA Business Solutions, an SAP partner, incorporating AI into business processes allows for more precise monitoring of purchase behaviors, offering insights into shifting consumer habits based on demographic factors and strengthening a company’s supply chain.
The company’s solutions can also help by customizing the features of ERP software like SAP S/4HANA to fit a CPG producer’s specific needs.
For those with existing SAP systems, NTT DATA Business Solutions’ Zero Cost Move Program can help users get ahead of the looming 2027 cutoff set by SAP for systems like SAP ECC by helping them to migrate to SAP S/4HANA.
The solution offers customized data insights, improved security and integrated AI to help CPG companies accelerate and unlock business value based on their specific challenges, opportunities and vision. This solution also helps CPG companies achieve digital transformation, which essentially begins with:
- Treating data as a strategic asset by investing in technologies and processes that unlock the full potential of their data assets.
- Assessing their organization’s ability and agility to adapt to new challenges and seize emerging opportunities.
- Having a consumer centric approach that is informed by data to foster loyalty and drive growth.
Together, these steps can make a company grow its business and boost its resilience to supply chain disruptions.
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