Atlantic Supply Chain Blog

Supply Chain Optimization – Where Do We Stand?

I hesitate to write this article from my point of view which reveals, unfortunately, how long I’ve been in the business.  Supply chain optimization has gone through a journey of recognition, over-promotion, many failures, and now, solid, sustainable applications.  The supply chain journey has been very like the Operations Research journey of the 60’s and 70’s.  Most of the OR efforts in large companies were proposed by organizations within those companies.  We were developing the technology as we approached every new problem.  Everything seemed possible.  Over-promotion was rampant and the failures often over-shadowed the successes.  When the smoke cleared however, some valuable OR efforts and applications continued.  There was a bubble but when it burst, some substance remained. 

The supply chain journey has been similar with some notable differences.  Most supply chain solutions since the late 80’s have been out-sourced, most major companies don’t try to develop solutions in-house anymore.  This means that, in the recognition phase of supply chain development, the field was very quickly filled with contenders.  Contenders with financial backing but little understanding of the problems that they purported to solve.  ERP vendors, who had been so successful in taking over the ERP functions in major companies, promised to complete the supply chain.  Just wait, they said, we’ll get there.

Our previous company, Chesapeake, started in the early 80’s to provide solutions integrating planning and scheduling.  Supply chain was not a term that was then prevalent.  In a few years, we were swept up in the supply chain bubble.  Then, the bubble burst as might have been expected.  It is interesting to note that most of Chesapeake’s competitors do not exist today and the promises made by the ERP vendors are still just promises.

So where does supply chain optimization stand today?  The good news is that, after all the hype and hoopla has died down, the technology has matured and the field is populated with knowledgeable consultants.  New technology, like the cloud, make it possible to implement solutions that couldn’t be envisioned before.  In short, I believe that supply chain optimization is poised for an extended period of developing solid, sustainable applications.  We, at Atlantic Decision Sciences, plan to play a major role in that development.

 

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