What is Concurrent Supply Chain Planning?
Concurrent supply chain planning has become increasingly popular as of late within the industry, but what exactly is a concurrent supply chain planning method? Furthermore, why should you use one?
Let’s take a closer look at what concurrent supply chain planning actually is and the benefits it can bring to any supply chain that is struggling with planning due to a lack of visibility.
Connectivity is a must
Connected end-to-end, concurrent supply chain planning keeps all links and parallel links within the supply chain, from finance to sales, marketing, planning, and execution, from strategic plans to tactical plans… all interwoven.
In turn, this connectedness leads to real-time visibility and data being provided to all involved in the movement of products throughout the supply chain.
Rather than sequential supply chain planning, where data and materials move sequentially from company to company, or team to team, concurrent supply chain planning allows information and data to flow simultaneously in many directions. This method allows for infusing the entire supply chain network with up-to-date data to increase rapid and finely-tuned preemptive decision making.
Constant data streams input from every point- clients, partners, suppliers, and so on means all links in the chain are immediately privy to any updates, changes, or gaps in planning. Doing so allows for pivots and shifts when and where they’re needed. This means concurrent supply chain planning is more responsive, flexible, and ready to troubleshoot at the drop of a hat.
Visibility increases collaboration and streamlines planning
In an increasingly globally interwoven and volatile market, supply chains that can react quickly to solve problems are the ones most likely to weather the ups and downs of fluctuating volumes. As 2020’s global pandemic clearly illustrated: the ability to adapt to changes quickly is vital for survival.
Concurrent supply chain planning allows for teams with different functions to share data, making informed changes that all other teams can see and understand the impacts of immediately, and adjust accordingly. Allowing inputs from sales and marketing teams, along with finance teams to lay out long-term plans and goals, while inputs from other teams, like suppliers, customers, and partners create shorter-term plans and lay out execution plans.
Approaching planning with this method is more holistic, making supply chains function faster and more collaboratively.
In traditional planning methods, functional teams operate separately, making understanding impacts one team’s decisions have on another’s performances or outputs difficult to track. Using these methods, it can take extended periods of time before data is analyzed in each department, and shared with the planning teams or management, who then have to analyze the data sets and attempt to understand the root of a problem.
In contrast, with concurrent supply chain planning, all teams share information, allowing snags to be dealt with at the moment rather than compounding problems for weeks while trouble spots are worked out. Concurrent planning allows for lower risks, less waste, and better overall visibility.
Get rid of the information silo
Another benefit seen with this strategy is the ability to synchronize schedules- allowing operational plans and weekly or monthly manufacturing plans to be connected in a meaningful way, essentially becoming one plan with multiple decision-making windows.
When there is tight synchronization of both operational and planning data, integrated business plans can become more precise and realistic, leading to more responsive supply chain planning. Responsive supply chains that don’t rely on carrying an excess of inventory is a difficult problem to solve- but with concurrent supply chain planning the ability to more precisely and accurately integrate data from various teams takes a step in that direction.
This method of planning is a direct response and an attempt to solve the myriad of challenges present in supply chains and their ultimate need for responsiveness at every point along the way. Information silos can no longer exist for businesses to thrive and remain flexible.
Cross-functional collaboration is trending in all areas of the supply chain and logistics industry, and concurrent supply chain planning is yet another facet of this trend toward more integrated processes.
Want to stay up to date on all the latest happenings in the logistics industry to stay ahead of the curve? Sign up for our newsletter to get monthly industry updates.