As a whirlwind of new technologies warps, displaces and shapes existing market and value networks dramatically, organizations must adapt quickly to remain relevant in the digital age. From the ‘smart factory’ to the ‘smart home’, cyber-physical systems are interacting seamlessly through the Internet of Things. Accelerated digital transformation is at the heart of the crystalizing fourth industrial revolution, or as popularly known, industry 4.0.
The influx of automation and artificial intelligence in our lives however, is not a result of an unforeseen technological revolution but a natural evolution of human ingenuity and innovation.
AS TECHNOLOGY EVOLVES, SO MUST OUR BUSINESS PLANNING MODELS
The need to predict plan and produce profit will remain immutable and paramount for enterprises in any age. Channelizing the power and potential of these disruptive technologies into the very blueprint of the organization, right from the planning stage, will reap unprecedented dividends.
Planning systems and related transactional data technology has traversed many stages of evolution. From simple Lotus 123 and excel spreadsheets to agile Manufacturing resource planning (MRP 2) and current SAP based ERP implementations, the progress has been largely powered by a technical convergence of memory planning and cloud computing.
The next milestone is the dissolution of barriers between the physical world, real-time information and planning systems by emerging technologies such as Big Data, BlockChain, Robotics and Process Automation.
The current paradigm shift in the world of planning will feature complex integration between sales, operations and finance driving tangible financial results and optimal control over the business for the C-suite. Overcoming the age old challenges of limited visibility in long planning cycles and sluggish creep of information in the supply chain, the business model of the digital age will be dynamic, relevant, ultra-reactive and integrated.
THE FOUR DIMENSIONS OF INTEGRATED BUSINESS PLANNING
The best practice framework leveraging the current technologies should be fact based, decision making focused, cross-functional and optimize value for the enterprise. Comprised of end-to-end business processes across the entire supply chain, it will essentially be 4 dimensional.
Financial Planning & Management:
Financial planning is a vital part of any business and sound financial management is critical to the success of any firm. However, this core activity of budgeting and forecasting is often the most dreaded largely due to the cumbersome and long drawn process that goes into painstakingly collating data from various departments in a labor intensive annual exercise.
The boons of the digital age will help firms experience a harmonious union between planning and execution systems and enable them to have fluid, real-time and dynamic business plans that achieve sustainable bottom-line benefits. Financial planning in the digital age will be simultaneously more automated and yet more proactive, helping businesses achieve more control with less time and resource investment.
The generation Y consumer is technology savvy, demanding and unforgiving. Always looking for the next best thing, attaining and sustaining their brand loyalty is a herculean task.
In the age of multi-channel commerce and diminishing product cycles, it is no longer just the fittest but the most agile companies that will survive in the market today. An integrated commercial plan with dynamic sales, optimal category planning and P&L projections will enable continuous monitoring of product performances and permit timely course corrections.
Enterprise Performance Management:
Industry 4.0 will see increased mushrooming of autonomous and intelligent supply chain ‘control towers’ that will not only provide real-time visibility and decision making support but will have artificial intelligence capabilities to make the decisions for you. These super advanced supply chain hubs will align performance management to overall company objectives like never before
Supply Chain planning:
Supply chain planning itself will see a major face-lift with AI, sensor based solutions and big data enabled heuristic models which will provide real-time information exchange and more accurate demand forecast. An equitable demand and supply with near perfect optimization of inventory, real-time delivery, superfast distribution chain and effective supplier control- can finally be a reality.
We are at the cusp of a major turning point and need to quickly reboot our business planning by harnessing these break-through technologies. Only those companies with a smart and integrated business plan will ride the transformation wave.
Principal, Infosys Consulting
Paula is a Principal in the supply chain practice of Infosys Consulting with more than 13 years’ experience across sectors ranging from oil and gas to consumer goods. Her focus is advising clients on best practices and innovation around supply chain optimization, S&OP and operations. She also leads process design and modelling programs, as well as IT solutioning initiatives around business intelligence and data management and agile methodology.