Process Industry Moving Up the Supply Chain Maturity Curve

I often joke that if you work in the process industry, you don’t feel a lot of love from supply chain analysts and publications because they focus so much on what’s happening in retail, high tech, and consumer goods. But there are a lot of interesting supply chain trends, challenges, and opportunities in the process industry too.

In fact, according to Chris Cameron, Senior Solution Architect at Elemica (a Talking Logistics sponsor), the process industry is starting to move up the supply chain maturity curve, following the path paved by the automotive and high tech industries a decade ago. Here’s what Chris said in a recent episode of Taking Logistics:

What I see happening is something that I saw happen in the late 90s in the high tech world [when] I was working on some supply chain items for Apple and Dell…and I’m watching some of the same things happen in the process industry [today], finally.

So, you always see that the process industry is all about the plant, and making sure you can keep the plant running and making sure you have the highest utilization for the lowest per-unit-cost coming out the door. And that’s similar to what I saw back when we were flying stuff all over the place to feed the Dell facility or when all [Apple] cared about was that the store took the order for the iPod.

And then [Dell and Apple] started realizing that, hey, it’s about the supply chain. I have to connect the demand all the way through to the supply side, and I’m starting to see that same trend happen with our client base in the process industry. I go to meetings now and [our clients] start to talk about brand new concepts that they’re going to start bringing out or making changes in their SAP system to do, and I come to find out that it’s the same thing we did in the automotive industry in the late 90s or early 2000s, and in the high tech industry even before then.

So, we’re seeing that move [by the process industry] to address the customer side [of the supply chain] rather than just keep the plant moving so you can produce 80 tons of goop at a time and then just figure [out how to flow it through] some kind of static supply chain. And that’s similar to what we saw happen when Dell took control of the reigns down in Austin and said, “I won’t take 5,000 kilos of disk drives anymore; I want to order 5 of them at a time and you deliver them every 10 minutes.” So I think you’ll start to see the folks in the [process industry] supply chain get a little more love as that [evolution] matures the way it did in the high tech and automotive industries.

To move up the supply chain maturity curve, companies in the process industry need more timely, accurate, and complete supply chain visibility, which was a major theme of Elemica’s reveal 2014 User Conference in Philadelphia last month (see announcement Elemica made at the event about its Business Process Control Tower solution). David Choi, Supply Chain and EBP Co-Leader at DuPont, gave a great presentation titled “A Journey Towards Superior Logistics Visibility” highlighting how the company is using Elemica’s Supply Chain Operating Network to gain better visibility of its shipments, especially exports. As Chris mentions in the clip below, where he discusses how companies are transforming their supply chain processes using a SCON, “We’re seeing a trend now happening among our client base where they’re saying, I have to get to that Amazon experience because my customers are asking ‘Where’s my shipment?’”

I encourage you to watch the rest of my conversation with Chris for more insights on this topic, including how he sees Supply Chain Operating Networks evolving over the next few years. After watching, post a comment and share your perspective!

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