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About the Author

Prasad Satyavolu
Global Head – Innovation, Manufacturing & Logistics Practice

Prasad is currently responsible for driving innovation and solutions for the Manufacturing Industry Practice of Cognizant.

Prasad has worked extensively across Industry sectors addressing core processes in Product Development, Integrated Supply Chain and Customer Experience management. His experience spans the Industry value chain and is geographically spread across the UK, Europe, South America, South East Asia, Japan, China, Australia and the North America region. Prasad has personally led & guided numerous programs covering solutions implementation and organizational transformation.

He has authored & guided research on product Development, Global Sourcing, Lean Enablement Strategies and Leverage of advanced analytical techniques in transforming business performance. These analytical solutions cover subjects areas in Warranty, Product Development, Network design and Enterprise Cost modes.

Supply Chain Comment

By Prasad Satyavolu, Global Head – Innovation, Manufacturing & Logistics Practice, Cognizant

September 4, 2014

Supply Chain Comment: Will the Evolving Connected World Construct Change the Paradigm of SCM?

A New Ecosystem of Information Sources in the Connected World has the Potential to Transform SCM from a Cost Focused Approach into a Customer-Centric Delivery Paradigm

With nearly every customer sharing his or her experience with your product or service offering across various social media and corporate Web sites, your operating environment has ascended a few notches on the exponential VUCA (Volatile Uncertain Complex Ambiguous) curve. And @ the speed of a tweet, particularly as SDD (same day delivery) becomes the norm and the costs of managing omni-channel experiences skyrocket. These developments drive a step change in customer expectations and augur major changes in the ways organizations re-engineer their value chains to meet them. It does not matter which industry segment you serve – how customers experience your fulfillment process will play a defining role in differentiating your offerings.

The Connected World is no longer science fiction –more than 20 billion devices are purported to be connected and another 50 billion will be in next two years as plans rapidly evolve to integrate several societal sub-systems. How will your organization’s product characteristics, demand & supply environment change in the emerging Connected World? Will the resultant and unprecedented visibility of information change the very nature of practices at all levels of the supply chain, i.e.:

Prasad Says:

Higher levels of automation in transactions (leveraging M2M connectivity) and deeper insights (from analytics on different data sets) arm supply chain professionals with the ability to deliver seamless visibility, proactive risk management and flexible operations.
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  • Strategy (e.g., network design)
  • Planning (e.g., Sales & Operations Planning + Forecasting)
  • Execution (e.g., inventory management)

This emerging reality, while presenting unprecedented opportunity for a differentiated customer value proposition, will create specific challenges in three key dimensions of supply chain management – product, demand and supply. Leaders will emerge among organizations that are able to successfully navigate:



Dependence and management of the electronics supply chain ecosystem, which is largely concentrated in Far East Asia



Tighter product lifecycles, which require synchronized and integrated system-level reliability verification and validation



Disruption risks, arising out of a lengthened globalized supply and demand environment



Increased urgency of managing supply chain talent – training, skills upgrade and tools



Tapping into the growth potential of emerging economies for business expansion, which means adapting to specific infrastructure, local regulatory and legal requirements to serve the markets



Building information technology infrastructure and applications to create the Holy Grail of manufacturing – a services-oriented business model

These challenges considerably increase the operations risk to businesses. In order to successfully mitigate these risks, organizations need to radically transform SCM practices including aligning these ways of working with the organization’s sustainability goals.

The 360° visibility enabled by advances around Connected Products (and “Things”) offer
interesting ways to meet these objectives. Automatic Identification and Data Collection (AIDC)
devices and systems, including GPS and Location Based Services (LBS), provide data for not just
trace & track but also help to create insights for predictable deliveries.

As SCM functions gear up to support organizational growth objectives, they should leverage a
multitude of new sources of information (unstructured and semi-structured data from sensors,
scanners, voice, wearables, images, video, etc.) now available for enhancing visibility, superior
network design and synchronization in their supply chains. Systems and applications for
strategic analysis, planning and execution that incorporate these information sources can also
help achieve these objectives.

Take service parts planning as an example. In the past these practices were completely
dependent on historical consumption patterns leading to “best-guess forecasts” and infant care
parts list. A wide range of applications and equally varying duty cycles made it practically
impossible to optimize inventory and minimize product downtime. Telematics data coupled
with completely recorded ambient conditions gives organizations the opportunity to build
accurate models for parts consumption and expense planning. These insights bring a highlyrefined
services-based model driven by outcomes, thus ensuring a greater share of lifecycle
revenue and deeper, longer customer engagement.

Higher levels of automation in transactions (leveraging M2M connectivity) and deeper insights (from analytics on different data sets) arm supply chain professionals with the ability to deliver seamless visibility, proactive risk management and flexible operations. A new ecosystem of information sources in the connected world has the potential to transform SCM from a cost focused approach into a customer-centric delivery paradigm. Imagine enjoying a special pizza delivery on the sundeck at Venice Beach compliments of location-based services and a fine-tuned fulfillment process! Such B2C convenience is exactly what the Connected World will soon bring to the B2B world.

Agree or Disagree with Our Expert's Perspective? 
Let us know your thoughts in the Feedback section below.

Recent Feedback

I fully agree, especially on the differentiated value proposition based n customer centricity.

I wonder if this will this keep the same product offerings with the same vendors, or will it change the product offering with a change in vendor alignment, and how agile will be the SCM to meet this demand.

Clearly the product offerings being made visible to the customer based on analytics is a progression on the core capabilities of the organization with a limited, vendor SCM. Or on the flip side or better side of it, how effective will be SCM in scenario where economics drive the customer away from the product offerings that the organization has.


Information System Strategy Advisor
Sep, 09 2014

Very good article and captures next round of changes driven by information flow across the chain. A few obsevations based on my understanding:


1. No. of product launches are multiplying as we keep on adding different versions for different segments and this has led to more difficulties first in planning process, then in supply lead time and also to manage obsolescence. There is a need to have a very strong "control tower" in place to manage these issues.


2. End of life treatment has become an integral part of the process and this means that SCM has to worry not only for support during life cycle but also have a strong network for reverse logistics as well. So information being tracked /received has a few more data points to take care of.


3. Growth / change in demand patterns has forced relocation of many manufacturing sites and this has also been constant source of disruption in the Supply Chain. Again this means having more information on supply options and logistics etc.


I thought of sharing these points with you and also look for your comments/feedback.


Anil Sathe
Founder and Principal Consultant
ACE SCM Solutions
Sep, 13 2014