Proactive Strategies for Resilient Supply Chains: Mitigating Hidden Risks

Summary

本视频脚本讨论了供应链的弹性问题，由麻省理工学院的David教授和Accenture的董事总经理pfk共同介绍。David教授领导MIT数据科学实验室，专注于数据科学，特别是供应链弹性。他们开发了一种新的供应链弹性评估方法，通过与福特汽车公司的合作，成功预测了2020年初新冠疫情对供应链的影响。pfk强调了供应链弹性管理的重要性，提出了五个最佳实践要素，并讨论了如何通过数字化孪生和压力测试来优化供应链弹性。他们还分享了如何利用这些工具来快速响应市场变化，提高企业竞争力。

Takeaways

• 🎓 **学术与实践结合**：Dr. Levy 与 Accenture 的合作展示了学术界与咨询公司之间的成功合作，共同开发了供应链韧性压力测试工具。
• 📈 **供应链韧性的重要性**：通过 COVID-19 大流行，供应链韧性从边缘话题变成了核心议题，企业开始重视并投资于韧性建设。
• 🔍 **数据科学的应用**：MIT 数据科学实验室与福特汽车公司合作，开发了新的方法来衡量供应链的韧性并识别潜在风险。
• 📊 **数字孪生技术**：构建供应链的数字孪生是实现供应链可视化和韧性管理的关键步骤。
• ⏱️ **时间关键指标**：引入了时间恢复（Time to Recover）、生存时间（Time to Survive）和性能影响（Performance Impact）等关键性能指标来评估供应链的韧性。
• 💡 **前瞻性管理**：通过预测性分析，企业可以提前识别潜在的供应链问题，并采取预防措施，从而避免未来的业务中断。
• 🌐 **全球化风险**：供应链的全球性质意味着一个地区的中断可能对全球产生连锁反应，因此需要全球视角来管理风险。
• 📉 **财务影响的量化**：通过建立数字孪生模型，企业可以量化供应链中断对财务的具体影响，从而更准确地评估风险和投资。
• 🛠️ **风险缓解策略**：通过压力测试和场景分析，企业可以确定和优先处理风险缓解活动，以提高供应链的韧性。
• 🚀 **竞争优势**：在面对全球性的中断时，能够快速反应并有效管理供应链的企业可以将其转化为竞争优势。
• 📚 **持续学习与改进**：企业需要持续地从每次供应链中断中学习，不断改进其韧性管理策略，以适应不断变化的全球环境。

Q & A

什么是供应链弹性(resiliency)，它为什么重要？

供应链弹性是指供应链在面对各种干扰时，能够快速响应并恢复正常运营的能力。它重要是因为在当前的商业环境中，如自然灾害、政治冲突、疫情等不可预测的事件频发，拥有弹性的供应链能够帮助企业减少中断带来的影响，保持业务连续性，甚至在某些情况下，通过快速反应获得竞争优势。

Dr. Levy 在供应链弹性方面有哪些贡献？

Dr. Levy 是麻省理工学院(MIT)的教授，他在供应链弹性方面做出了显著贡献。他与福特汽车公司合作，开发了一种新的方法来衡量供应链的弹性水平，并识别潜在风险。他的研究成果发表在《哈佛商业评论》上，并且他在2020年初准确预测了新冠疫情对北美和欧洲供应链的影响。

Accenture 和 MIT 是如何合作来提升供应链弹性的？

Accenture 与 MIT 合作，将 MIT 开发的技术规模化，应用到多个行业中。他们共同开发了所谓的“供应链压力测试(residency stress test)”，帮助企业通过模拟不同的干扰情景来测试和提高其供应链的弹性。

什么是供应链压力测试，它如何帮助企业？

供应链压力测试是一种评估工具，它借鉴了金融行业在2008年金融危机后的做法，要求企业模拟各种潜在的干扰情景，以测试其供应链的抗压能力。通过压力测试，企业能够识别潜在的风险点，制定应对策略，从而在真正的危机发生时能够更加迅速和有效地响应。

在供应链管理中，为什么需要高层领导的支持？

在供应链管理中，需要高层领导的支持来打破内部隔阂，实现端到端的可视化管理。没有高层的支持，采购、生产、研发等部门可能无法协同工作，形成统一的供应链弹性策略。

如何衡量供应链的弹性？

衡量供应链弹性可以通过几个关键的指标，如恢复时间(time to recover)、生存时间(time to survive)和性能影响(performance impact)。这些指标帮助企业量化在特定干扰下，供应链恢复正常运营所需的时间和对企业财务的影响。

什么是数字孪生(digital twin)，在供应链管理中它扮演什么角色？

数字孪生是一种虚拟模型，它能够代表物理世界中的实体或系统。在供应链管理中，数字孪生可以用来模拟整个供应链的运作，帮助企业进行风险评估、决策制定和性能优化。

为什么说供应链风险常常隐藏在意想不到的地方？

供应链风险常常隐藏在意想不到的地方，因为传统的风险管理往往关注于那些显而易见的、成本较高的供应商。然而，一些小型供应商或者那些看似不重要的环节，一旦发生问题，也可能对整个供应链造成巨大的影响。

企业如何利用数字孪生来提高供应链的弹性？

企业可以通过建立供应链的数字孪生来模拟不同的运营场景和潜在的干扰情景。通过这种方式，企业能够识别风险，优化库存管理，制定灵活的采购策略，并在危机发生前制定应对措施。

在当前的全球形势下，企业应如何考虑其供应链的地理分布？

企业在考虑供应链的地理分布时，不能仅仅关注于将供应商和生产设施靠近市场需求，以期望提高弹性。实际上，根据数据，仅仅改变供应商的地理位置并不能保证供应链的弹性。企业需要综合考虑多种因素，包括政治稳定性、基础设施、供应商的可靠性等。

半导体行业的供应链问题对多个行业产生了哪些影响？

半导体行业的供应链问题对汽车、消费电子、医疗设备等多个行业产生了影响。由于半导体短缺，许多行业面临生产延迟和成本上升的问题。此外，半导体供应链的复杂性和全球性意味着一个地区的干扰可能会对全球市场产生连锁反应。

企业如何平衡供应链的效率和弹性？

企业需要在供应链的效率和弹性之间找到合适的平衡点。这意味着在优化成本和提高服务水平的同时，也要考虑到潜在的风险和干扰。企业可以通过建立数字孪生、进行压力测试、制定灵活的策略来提高供应链的弹性，同时保持效率。

在当前的能源危机中，企业应如何提高供应链的弹性？

面对能源危机，企业需要采取多种措施来提高供应链的弹性。这可能包括寻找替代能源、优化能源使用、建立多元化的供应商网络、提高能源效率等。此外，企业还需要密切关注市场动态，快速响应能源价格的变化和政策调整。

Outlines

00:00

🎓 学术与实践的结合：供应链弹性讨论

本段落介绍了两位嘉宾，Dr. Levy和pfk，他们在运营研究、供应链管理以及创业方面有着丰富的经验。Dr. Levy是麻省理工学院（MIT）的教授，专注于供应链弹性的研究，并与福特汽车公司合作开发了一种新的衡量供应链弹性的方法。pfk作为埃森哲的董事总经理，与Dr. Levy合作，共同开发了一种名为“弹性压力测试”的工具，旨在帮助企业应对供应链中断。此外，还提到了MIT与埃森哲之间的技术合作，以及学术界与咨询行业之间的合作重要性。

05:01

📈 供应链弹性的五个要素

在这段对话中，讨论了如何衡量和提升供应链的弹性。首先，强调了CEO在推动供应链弹性方面的领导作用，因为需要打破内部隔阂，实现端到端的可见性。其次，提到了建立专门的供应链弹性团队的重要性，以及利用数据进行决策的必要性。此外，还强调了将中断视为机遇，以创造竞争优势的观点。最后，讨论了面对不断变化的市场环境，如何通过工业化的方式帮助客户定期进行弹性分析，以应对无处不在的中断。

10:02

🔍 供应链弹性的实施案例分析

本段落通过福特汽车公司的案例，深入探讨了供应链弹性的实施细节。介绍了如何通过建立数字孪生模型来映射整个供应链，并使用新的KPIs（关键绩效指标）如恢复时间、生存时间和性能影响来识别隐藏的风险。通过这些指标，可以计算出特定供应商中断对公司收入的具体影响，从而帮助公司优先考虑风险缓解策略。此外，还讨论了如何通过减少库存来降低成本，同时保持较长的生存时间。

15:03

📉 隐藏的供应链风险

在这一部分中，强调了供应链风险可能隐藏在意想不到的地方，例如小供应商的中断可能会对公司的底线产生巨大影响。讨论了如何通过数字孪生模型来识别这些风险，并使用时间生存（time to survive）这一新的KPI来衡量供应链在没有某个设施的情况下能够维持多长时间。此外，还提到了如何通过减少库存来降低成本，同时保持较长的生存时间，从而创造商业机会。

20:04

🛠️ 供应链弹性管理的数字化转型

本段落讨论了如何通过数字化手段来提升供应链的弹性。提出了三个简单的步骤：首先进行成熟度评估，然后建立数字孪生模型，最后进行压力测试以应对不同的危机场景。强调了数字孪生模型的重要性，因为它可以提供对整个供应链（包括一级、二级、三级和四级供应商）的全面可见性。通过这些步骤，可以快速响应市场变化，优化库存，并在竞争中获得优势。

25:04

🌐 跨行业供应链弹性的关键洞察

在这一部分中，总结了在多个行业中实施供应链弹性管理的关键洞察。强调了供应链弹性管理不仅是一种哲学，还需要通过供应链映射、建立数字孪生模型和使用新的KPIs来实现。这些措施有助于识别隐藏的风险，建立所需的灵活性和冗余，并在事件发生时快速响应。此外，还讨论了如何在当前的全球危机中，如能源危机和半导体短缺，应用这些原则来构建更具弹性的供应链。

30:05

🚀 供应链弹性与政策制定

最后这一段讨论了供应链弹性与政策制定之间的关系。以半导体行业为例，分析了当前的产能不足问题，以及中国台湾局势对全球供应链的潜在影响。强调了在新的半导体制造设施建成之前，如何通过快速反应来维持供应链的弹性。此外，还讨论了政策制定者如何通过投资和技术创新来提高供应链的弹性，并强调了快速反应在竞争中的重要性。

Keywords

💡供应链弹性

供应链弹性指的是供应链在面对干扰时保持运作并迅速恢复正常的能力。在视频中，供应链弹性是核心主题，讨论了如何通过运营研究和现代供应链风险管理来增强这一能力。例如，通过与福特汽车公司的合作，开发了一种新的方法来衡量供应链的弹性并识别潜在风险。

💡运营研究

运营研究是一种应用分析方法来帮助做出更好的决策的科学。在视频中，运营研究被用来通过数据科学和数学模型来优化供应链的效率和弹性。例如，Dr. Levy 通过运营研究的视角来探讨供应链问题，并将这种方法应用于现代供应链风险管理。

💡数字孪生

数字孪生是指创建一个物理对象、系统或过程的虚拟表示，以便于模拟和分析。视频中提到，为了增强供应链的可见性，需要构建供应链的数字孪生，这有助于识别风险并快速做出决策。例如，通过数字孪生，可以模拟供应链中断的影响并制定应对策略。

💡风险管理

风险管理是指识别、评估和控制风险的过程，以减少潜在的负面影响。视频中强调了风险管理在供应链中的重要性，特别是在面对不可预测的全球事件时。例如，通过供应链压力测试，公司能够评估潜在的干扰并制定应对计划。

💡压力测试

压力测试是一种评估系统、模型或公司在极端条件下表现的方法。在视频中，Dr. Levy 提出了将压力测试应用于供应链的概念，以确保它们能够应对未来的危机。例如，通过模拟不同的危机情景，公司能够评估其供应链的弹性并制定改进措施。

💡首席执行官

首席执行官（CEO）是公司的最高执行官员，负责公司的战略方向和决策。视频中提到，CEO的领导和倡议对于推动供应链弹性至关重要。例如，CEO需要打破内部隔阂，确保端到端的供应链可见性。

💡数据科学

数据科学是一门涉及数据收集、分析和解释的跨学科领域，旨在从数据中提取知识和见解。视频中，Dr. Levy 领导的 MIT 数据科学实验室专注于数据科学，特别是在供应链弹性方面的应用。例如，通过数据科学方法，可以预测和量化供应链中断的潜在影响。

💡中断

中断指的是供应链中由于外部或内部事件导致的流程或操作的中断。视频中讨论了中断对供应链的影响，并提出了管理这些中断的方法。例如，通过构建数字孪生和进行压力测试，公司能够更好地理解和准备应对潜在的供应链中断。

💡竞争优势

竞争优势是指公司在市场中相对于竞争对手所具有的有利地位。视频中提到，通过提高供应链弹性，公司可以将其转化为竞争优势。例如，通过快速响应市场变化和供应链中断，公司能够比竞争对手更快地恢复和适应，从而获得市场优势。

💡敏捷性

敏捷性是指快速适应变化和应对突发事件的能力。在视频中，敏捷性被视为供应链管理中的一个重要方面，特别是在面对不断变化的市场和潜在的供应链中断时。例如，通过实时监控供应链状态并快速调整策略，公司能够保持其运营的敏捷性。

Highlights

介绍了与MIT合作开发的供应链弹性压力测试，旨在帮助企业应对和管理中断。

强调了供应链弹性的重要性，特别是在COVID-19大流行期间。

提到了与福特汽车公司合作开发的衡量供应链弹性的新方法。

讨论了供应链中断对企业财务影响的量化，如福特汽车公司因供应商中断可能损失4亿美元。

强调了时间恢复（time to recover）和性能影响（performance impact）等关键概念。

提出了时间存活（time to survive）这一新的KPI，用于独立于供应商信息的内部评估。

展示了如何通过数字孪生技术来映射整个供应链并识别隐藏的风险。

讨论了供应链中断的财务影响，以及如何通过建立数字孪生来提前识别和缓解风险。

强调了供应链管理中CEO的领导作用和跨部门合作的重要性。

提出了供应链弹性管理作为常规管理流程的必要性。

讨论了如何通过成熟度评估、建立数字孪生和压力测试来提高供应链弹性。

介绍了如何利用数字孪生技术来提高对材料级别风险的可见性。

强调了在供应链管理中，快速反应时间的重要性。

讨论了半导体行业的供应链中断问题，以及如何通过建模和预测来应对。

分享了与Denzel公司合作的案例，展示了如何在半导体行业中应用供应链弹性管理。

强调了在政策层面上，投资于半导体制造设施的同时需要考虑供应链的弹性。

讨论了在当前能源危机下，如何通过供应链弹性管理来应对原材料成本上升的问题。

提出了关键绩效预测器（KPP）的概念，作为预测未来供应链状态的工具。

Transcripts

foreign

[Music]

so I am super excited to to introduce

two guests here right now you may have

heard uh Professor Levy earlier this

morning in a talk uh Dr Levy

um is one of the most esteemed academics

in operations research and supply chain

also an entrepreneur in the space as

well so super excited to hear what he

has to say on resiliency

um he doesn't know this but my

connection with MIT in this space I'm

not an academic goes back to watching a

friend of mine at the time John Roark

defend his PhD thesis in 1998 at MIT

which became a company called uh optient

and later on Dr Levy would would found

uh kind of a Next Generation version of

that looking at different supply chain

constraints so what's fascinating about

looking at supply chain is you're going

to hear now is we can look at an

operations research lens but bring it to

Modern supply chain risk versus just

demand capacity planning so Dr Levy

great to have you here

and pfk who is a managing director at

Accenture and works with Dr Levy and

colleagues looking at resiliency will be

kicking it off so pfk

[Applause]

soda so good afternoon everyone so I go

by pfk and so we're going to discuss

resilience today and what we want to do

this afternoon is to go beyond the bus

because residence has been the buzzword

for last two years and so we're happy

that today we're gonna show you what we

did with our clients to equip them so

that they can become you know super good

at managing resiliency and together with

MIT we develop what we call the

residency stress test that we're going

to present today and which we think this

is a this is interesting stuff for our

clients to do so that they can you know

manage disruption

we're going to present that I'm happy

that we did that together with David and

the good thing you know you know the

collaboration between academics and

Consultants sometimes it's a bit of a

love and hate relationship basically

these things we are bullshitters

we consultant and we think that you are

totally non-pragmatic and I'm glad to

say that we have been working together

with David for years and hopefully this

session will maintain peace between

consultants and academics and joke aside

you know we're happy about what we did

and we want this to be very pragmatic

get a session of of questions that yeah

you guys can challenge us and David

passes the mic to introduce yourself

great thank you welcome everybody

um as pfk said I'm on the faculty at MIT

at MIT I lead the MIT data science lab

which is a partnership between MIT and

about 25 companies focusing on data

science one area that we started

focusing on way before the pandemic in

2012 after event like the tsunami in

Japan and the flood in Thailand was

supply chain resiliency we collaborated

let me move here we collaborated with

the Ford Motor Company to develop a new

way

for companies to measure the level of

resiliency in their supply chain and

identify hidden risk and we reported

our finding and the New Concept in the

yellow Harvard Business review article

that was published toward the end of

2014 at that time

I was knocking on many doors trying to

convince companies to look not only at

supply chain efficiency but also at

resiliency very little interest most

companies focus on cutting costs through

lean through consolidation Outsourcing

and of and offshore everything changed

at the beginning of the epidemic but

perhaps known in the way you expected

in January of 2020 the pandemic was in

China it was not in North America and it

was not in Europe I started collecting

data on what's happening in China and I

use the technologies that I developed

six years earlier

to understand the impact of what's going

on in China on supply chain in Europe

and in North America and I published the

paper on the right hand side on the top

right hand side in February saying that

supply chain in North America and Europe

will shut down

in mid-march and this is exactly what

happened and after that we had the flood

of interest in our technology in our

framework MIT sign a contract with

Accenture to scale up our technology

into movie to multiple Industries

two months later in April of 2020.

I published a follow-up

identifying the importance of supply

chain stress tests

that companies need to take their supply

chains through and I borrow the concept

of stress tests from the financial

industry where after the financial

crisis of 2008 the federal government in

the U.S government in in Europe require

Banks to take the supply chains through

stress testing making sure that they are

ready for the next financial crisis and

in that paper

very short paper I highlighted the

importance of applying stress test for

supply chain in healthcare life science

semiconductors and the food industry and

I'm pleased to see how much interest we

have with this technology and how

successful our partnership has been in

in applying and implementing these

technology

let's be

okay so talking about what we call best

performers you know we want to go

straight to the point and tell you how

what we would describe is there's no

very best performance but if we were to

to give you some element of ingredients

this is a quote from the CEO of uh

Automotive tier one suppliers 15 billion

uh something like 180 sites and 150 000

people working for this company and the

question was very simple from the CEO

back in 2020 how do I measure resilience

I hear about Brazil but I've got no clue

how I can measure it second year what is

a business case of investing into

resilience what is at stake what are the

benefits what are the potential cost and

where do I start and this is where we

engage the discussion say we need to

industrialize to help our client being

able to be equipped so that they can run

those type of analysis but also have

them on a regular basis because we know

disruption is all over the place and

it's not a standard Road it's not a

one-off investment so five ingredients

to describe what the best practices look

at you know this is a CEO initiative why

is it important because if you want to

have a residency if you want to have

end-to-end visibility you need to break

the internal silos and you cannot do

that if you are a procurement guy or

manufacturing guy a r d guy you need to

bring the end-to-end perspective and you

need to the top leadership to be behind

that

supply chain residency team this this

company has set up a dedicated team

which is only focused on residency

this is a job this has become a core

process

of course they're leveraging data we're

going to discuss about the stress test

you need to get the data so that you get

the right data the right visibility to

take the right decision faster versus

competition

and finally they are looking at win

business it's not you know it's not

about risk management they see

disruption as an opportunity I want to

create competitive Advantage versus

competition so I want to be equipped so

that I can go faster versus rest and

this is what they did and so the CEO

commented about this stuff uh two years

ago and this is what we're going to

share with you today

in an element of context you know I'm

going to be quick because we want to

have a question you know the disruption

is a new normal it's all over the place

the one that I like you know if you look

at un they say we're going to move from

400 to 600 climate disaster per year so

like it or not you know we're going to

have to face those type of situations

you know about geopolitical we're going

to talk about that the one that I like

is demand search we have in

is what the friendship that in Holland

we are on the second land of cheese and

you probably remember you don't know

that but Oprah Winfrey you know two

years ago she did uh she did a show and

she talked about one of the worst she's

in France I'm not gonna name give the

name and in a question of 24 hours the

men in the U.S you know was multiplied

by 20. and so we are in a world today

with the Gartner calls that the business

moment you have a very you have a Kim

Kardashian talking about something and

suddenly the supply chain guy is

expected to come up with a 10 times the

production so we are in a in a world of

disruption and being resilient becomes

something super important and you this

is a way you can create competitive

advantage what we're going to do next

David is present you know the concept

has been there for years it's about you

know how do you make sure that you know

you can look at your resiliency not in a

question of days or weeks but in

question of hours and this is what we

did David thank you

so remember our definition of supply

chain resiliency we are looking at the

supply chain end to end and we are

trying to identify its ability to

respond to a disruption anywhere

in the business on our supply chain and

business performance and so it's

appropriate to illustrate our framework

our concept

uh with the original implementation add

default model company here is a

simplified version of fault supply chain

just to illustrate the complexity in

tier one we have about 6 000 suppliers

in this supply chain there are about 60

000 components that flow between the

different facilities initial

implementation was at the North America

assembly facilities in the initial

discussion with the leadership at Ford

they asked where should we focus our

attention in terms of supply chain

resiliency and risk mitigation strategy

the supply chain is too complex

procurement it fold had their own answer

procurement suggested recommended to the

leadership to focus on strategic

suppliers who are strategic suppliers

strategic suppliers Supply will fold

spend huge amount of money with each

supplier every year and the leadership

ask us if this is the case or maybe we

should focus elsewhere and so to answer

that question I'm going to introduce a

couple of Concepts the first one is time

to recover time to recover is associated

with a specific facility or a region

consider for example the chemical

supplier we try to identify how long it

takes a chemical Supply to recover to

full functionality after A disruption

talking to this supplier the supplier

identify time to recover to be two weeks

why it's two weeks because now they

provide food with chemical foamy

facilities that the company has in China

if there is a disruption they can switch

production and wrap up capacity to a

facility in Singapore and it takes about

two weeks now there are many supply

chain people here and immediately you

have multiple questions about time to

recover the fails time to recover is

scenario dependent so associated with

time to recover I need to identify what

is a scenario the second if I connect

with a specific supplier and try to

identify their time to recover Supply is

going to be optimistic they know that if

they tell us time to recovery six months

it's going to be a big problem and so we

need to compliment time to recover with

kpis that are more objective and I will

show you in a second but suppose we

validated the information about the time

to recover from this chemical supplier

we can now calculate performance impact

what is performance impact this is the

impact on fold bottom line when this

supplier is down for two weeks an

important requirement in our ability to

calculate performance impact is supply

chain mapping so our starting point was

mapping the entire supply chain building

a digital twin that represents the

supplier and then in this simplified

example we estimated that the

performance impact on Revenue associated

with the disruption at this supply for

two weeks is about 400 million dollars

you understand that under the hood we

have an analytics that allocate the

available resources after the disruption

in effective way to try to achieve

certain objectives that Ford is focusing

on so these are at a high level two

important Concepts let me now show you a

data straight from the fold system and

you can see two insights on this slide

on the left hand side

you see a figure with thousands of

bubbles each bubble represents a tier

one supplier

on the y coordinate I am showing you

spin annual spend at each one of the of

the supplier to protect fold

confidential information I just don't

show you the value but you immediately

see that the suppliers there at the top

is a strategic supplier for spend huge

amount of money with this supplier here

are three other suppliers it can be

considered strategic suppliers for spend

a huge amount of money with each one of

them on the x coordinate I have

performance impact

fold is looking at impact on profit

during A disruption at each one of the

suppliers you can see immediately that

the Strategic suppliers expose the

company to some risk I would say

moderate

the risky supplier are actually not the

Strategic supplier they are all at the

bottom right hand side I love this

supplier the one that I'm pointing out

to this is a tiny suppliers that provide

fault with components that cost 20 cents

but if Supply is disrupted huge impact

on bottom line ask yourself the

following question how many procurement

executive go to sleep and seeing oh this

time is supplier is my riskiest supplier

certainly not at fault

that's why I say in supply chain risk is

hidden in unexpected places here is

another Snapshot from the fourth system

where you see the Tier 1 suppliers by

location each bubble is a tier one

supplier the size of the bubble is

proportional to the risk that this

supplier exposed forward to and you can

see fails fold as North America assembly

facilities receive Supply from suppliers

in North America in Europe and in Asia

and risky suppliers are everywhere there

is an idea especially in North America

that if you false suppliers and

Manufacturing facilities to move

closer to market demand you are going

necessarily to increase resiliency this

is not supported by data that's why I am

saying be careful with the idea of just

pushing supplier from one country to

another that may be important for many

reasons but on its own does not

guarantee resiliency and as I was

explaining to one of the members here

we had during the pandemic many examples

of domestic supply chain in the U.S that

were affected by covid and created

enormous shortage especially in the food

and beverage industry now remember that

we need also a kpi that is independent

of scenario and it's independent of

information received from the supplier

and that's what I call time to survive

what is time to survive

time to survive you remove a facility

from the supply chain and you ask how

long can I make Supply with the men

without that facility it's not zero

because a pipeline is full with

inventory but I can calculate it

and you can see on this slide

detailed information about Ford

suppliers and component time to survive

on the x coordinate I'm showing you time

to survive in weeks so you can see one

day two days three days one week

10 days all the way to two weeks 30

weeks 50 weeks they had suppliers and

component so it's time to survive was 60

70 even 100 weeks

just by looking at this slide you see a

challenge and an opportunity the

challenge is associated with all the

suppliers on the left hand side these

are the suppliers time to survive is

very short one day two days I don't care

what they tell me I know these are risky

Supply because if they are disrupted

enormous impact on bottom line

the light inside suggests a big business

opportunity why it's a big business

opportunity because for some component

for time to survive these 100 weeks why

is it 100 weeks because Ford is sitting

on a lot of inventory if I just cut

inventory by 20 or 30 percent

I can cut costs and still have a very

long time to survive and so let me close

this section by highlighting the

importance of understanding Financial

impact of A disruption by building a

digital twin looking around the corner

to identify hidden risk and using a new

kpi let me

give insight about the kpis that I'm

using here and and the insight about the

kpi that I'm using here time to survive

time to recover and performance impact

the best way to describe them is to

borrow an Insight from Sports

I don't play Ice Hockey but I like to

watch ice hockey Wayne Gretzky one of

the most famous players in that game

used to say I don't skate to where the

pack is I skate to where the pack is

going to be this is what we are doing

here we are identifying potential

problems it will hit our supply chain in

the future and we want to take

mitigation strategies today before they

hit the supply chain I like this to

quotes from Ford and Schneider Electric

fault VP of product development and

purchasing saying if you can do that

develop a digital twin and use time to

recover time to survive in performance

impact you can identify and prioritize

your risk mitigation activities and net

Clayton

in a talk that I gave with a net in

September of last year

basically said we implemented this

concept and these types of ideas

it help us improve our business

performance and she said leveraging Digi

digitization was very critical you can

automate these capabilities and when you

use Concepts such as time to survive in

time to recover you keep your business

and growth healthy and keep your

customer and shareholder happy

yeah okay so the old idea you know I

think the concept I've been there for

for years you know for the start of this

residency Journal years ago but the

question becomes you know how can we

equipment how can we leverage data

analytics so that you know all our

clients can be ready can be residency

ready and you know develop unique

capabilities to manage and optimize

resiliency and again it's all about

developing a resiliency management as a

routine and a management core process

because we are you know we know

disruptions is coming and you have to to

become a residency savings so basically

three simple steps

start by the high-level maturity

assessment I'm not going to spend time

on that we've got specific industry

Benchmark to you know engage the

discussion where do you stand then the

most important step is about building

the digital twin I think this morning

there was a question how many companies

do have a digital twin today I think

we're in the range of 10 percent

if you want to be in the very best if

you want to be a best performer in

residency you need a digital twin and

we're going to show you how it what we

develop to equip our clients with this

stuff and finally most importantly you

know stress tests come up with multiple

scenarios to see at the climate

disruption Supply shortage Talent you

know geopolitical crisis what is the

impact on my Revenue because uh to

David's point you know we're not

interested in what overall risk how does

it impact my bottom line

so you know maturity score just to size

a stake and you know and put the topic

on the table most importantly you know

get the visibility with the digital twin

and we to your point we are going at the

material Level at the bit of material

because this is where you're relevant

this is where you can really calculate

your uh your impact on the revenues and

we are going to end tier suppliers

which is the beauty of digital twin you

know you're not only looking at tier one

you're looking at tier two tier 3 tier

four and I'm sure in this room you have

many experience you know you knew about

your tier one but you didn't know that

the tier three was located in Poland

Ukraine or during the float in Malaysia

and you are stuck so the simple digital

twin is providing you a first Insight in

terms of overall visibility where are my

risk and from there what we do we apply

stress test in a scenario looking at

different options duration different

type of Crisis to come up with an

overall residency score but more

importantly to look at what are the

options what are the mitigating actions

with this Automotive suppliers that we

presented we came up with a 15-20

priorities but the first three were

reducing sixty percent of the overall

risk so this helps you prioritize and

decide where you need to invest dual

sourcing inventory you know redesigning

the parts you've got the priorities

because we all know resiliency is

costing a lot and you want to become

resiliency 2.0 which means cost

effective resiliency because if you're

piling up inventory you know this will

not help you with your bottom line

so what is the outcome we come up with a

residency dashboard because providing

you a residency score and saying how you

make how you're doing versus competition

and as I said most importantly what are

the potential alternative scenarios and

now the reaction of the seal was you

know when we are the floating in Germany

he asked you know what's going to happen

to me

and he said and so in a question of days

the team was able to respond you know

this is what we need to do how can we

switch from one place to the other what

type of suppliers and your direction you

know whatever has this question you know

two months ago it would have taken me

something like two months to get the

answer so I think the name of the game

you know time to reaction time to

absorption and this is what we're trying

to to do and again with this idea that

residency management is becoming a core

process that's got to be part of

procurement and supply chain and this is

where we see the market heading

the video You're the academics here so

you want to to close so just to

summarize what we have learned

through now dozens and dozens of

implementation remember I started in the

automotive industry since then we have

implemented in Semiconductor in cpg

um high-tech here are the four key

insight

much like clean resiliency is is a

philosophy which means that when

companies optimize decision in their

supply chain they need to find the right

balance between efficiency they've been

doing this for a long time resiliency

and business performance and he told in

order to do that very well you need to

build you to start with supply chain

mapping build a digital twin of the

supply chain and use new kpis that

companies and supply chain professionals

have not used Before Time to cover time

to survive in performance impact this

allows you to identify hidden release

to build flexibility and redundancy

where you need it

to identify to measure changes in your

resiliency exposure and to respond when

an event happens anywhere in your

business

let us stop heal

Jason perfect so to kind of translate

this from the past in an academic

approach to the reality of today if we

just you know focus on Europe with the

energy crisis there are a lot of raw

materials take aluminum for example that

the cost of energy can make the cost of

production prohibitive if we look back

during covid at the continued

semiconductor crisis

uh we're dealing with a situation in

case of building resiliency is is a

major effort so I'd love to kind of ask

both of you your thoughts on how do we

look at this from a current lens and

take semiconductor as an example

so semiconductor is really a great

example because a lot multiple

Industries are struggling and the reason

the timing of that question is great

Jason is because we just finished a lot

it completed the loud project with

Denzel which is a very large supplier in

the automotive industry modeling the

inter-supply chain starting with wafer

manufacturing and I'll give you two

types of insight insightful supply chain

professional but also policy related

insight for supply chain professional

what we learn with data from that

industry focus of demand in the

automotive industry is it today there is

not enough capacity for the

semiconductor requirements that the

automotive industry needs and it's

projected based on the data that we have

to last at least until the middle of

next year more importantly

if you think about the China Taiwan

situation what we found that a short

disruption

say for 10 days

we'll have a ripple effect that affects

the entire supply chain for at least 12

months

that is to say to just go back after a

10-day disruption of wafer manufacturing

say because of the tension in Asia

to go back to where we are today which

is not perfect because of the shortages

will take at least 12 months these are

the the supply chain inside but there

are policy inside that are very

important and I was pleased to see that

the economic report by the

U.S president team looking at uh how to

improve supply chain uh Prospect

emphasize this type of technology and we

basically had a discussion with the with

representative from the White House on

two policy inside the first one which is

very important is there are a lot of

investment now geared in North America

towards semiconductor manufacturing

facilities

but you need to build for resiliency

just investing in in semiconductor

Manufacturing in the US may be very

important but by itself does not

guarantee resiliency remember my company

comment uh earlier about other domestic

Supply chains that were affected

dramatically during the pandemic the

second important observation is that it

will take two to three years until these

facilities are live until these

facilities start producing product we

need to make sure that we have an

ability to respond within the next two

to three years before these facilities

come and become operational

embedding a resilience into your supply

chain is one thing but reacting faster

versus competition we we are we have

procurement professional you know the

typical resiliency policies to go from

monosource to dual source but if you are

reacting uh two weeks after a

competition most probably you know the

capacity of the second suppliers will

already mobilize so dual shorter is only

a residency measure if you are reacting

faster versus competition so the time to

reaction is becoming absolutely clear

and this is why you need the data

if you wait too long you're stuck so

having your inventory having a dual

sourcing having that's great

but most importantly you need to react

faster and right now you know if you

look at Transportation we're working for

a automotive suppliers they have one

billion on Transportation they are stuck

they are profitability they need to come

up with solution and it's all about

playing with this agility so yeah as a

procurement and supply chain

professional you need to be equipped to

manage this disruption otherwise you're

you're just in the victim ship mode well

what can I do you know price of energy

are exploding by uh I want to look at

Serato fertilizer they had to stop

plants in Europe because of the the

price of energy was too high so there

are certain situations where you can do

nothing but also situations where you

can react and and react faster versus

competition this is where you can create

competitive Advantage maybe one way to

demonstrate this is to understand that

here we are complementing kpis this is

what most companies are doing which is

focusing on the current state of the

supply chain with what I call in my

publication kpp key performance

predictor I'm trying to predict what

will be the state of the supply chain

six seven eight weeks from now because

if I can identify a potential problem

that will hit my supply chain seven

weeks from now I can respond now and

avoid the problems that otherwise would

hit my business that's why speed is so

important that's why complementing kpis

with kpp is critical for procurement and

supply chain professionals

gentlemen thank you I have 10 other

questions I would love to ask you but

we'll have time in the future I'm sure

thank you both thank you