2023 Supply Chain Outlook: Expert
Advice on Thriving in Times of Change
Four experts weigh in on the future of supply chain management.
Contents
3
10
Applying the lessons of the supply
chain crisis.
Developing agility in times
of change.
4
13
Building resilience means
bouncing back fast.
Q&A with Deepak Mavatoor,
Shifting from output to outcomes.
Q&A with Vlad Filippov,
Spark Equation
7
16
Adapting to continued supply
chain disruptions.
Q&A with Peter Liddell, KPMG
The role of technology and
Tata Consultancy Services
Q&A with Joaquim Duarte
Oliveira, Deloitte Portugal
automation in supply chains.
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Applying the lessons of the supply chain crisis.
The past two years have brought repeated, outsized
To answer these questions, Appian interviewed four supply
disruptions to the world’s supply chains. Prior to 2020,
chain thought leaders for their expert insights on the state
supply chains were largely invisible to the general public.
of supply chains. These experts from Tata Consultancy
COVID-19 and other disruptions brought massive upheavals
Services, KPMG, Deloitte, and Spark Equation bring decades
that shined a spotlight on a precariously balanced system.
of supply chain management and technology experience to
Supply chain professionals are curious about a number of
questions: What lessons can we learn from the past two
years? Are we out of the woods or will disruptions continue
eating into company profits? And how can companies evolve
bear on answering several key questions. We discuss the
state of supply chains, how companies can successfully
adapt going forward, the role of environmental, social, and
governance (ESG) initiatives, and much more.
their supply chain management to survive or even thrive in
the future, no matter what comes next?
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Building resilience means bouncing back fast: Deepak
Mavatoor, Managing Partner, Tata Consultancy Services.
A Managing Partner in Growth and Transformation within TCS Manufacturing, Energy
and Resources business unit, Deepak heads the Supply Chain and Plant Operations
business advisory practice. He has more than 20 years of proven thought leadership in the
manufacturing sector across supply chain, manufacturing, and operations functions. His
passion is helping his customers shift their businesses to be driven by digital, IOT, and cognitive.
Mavatoor earned his MBA from the Ross School of Business at the University of Michigan, and
has a bachelor’s degree in Mechanical Engineering from the University of Mysore, India.
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Q&A with Deepak Mavatoor.
Q: What have the last two years shown about the
world’s supply chains?
Well, for starters, two years ago, my family didn’t know what I
did for a living. Now they do and think I’m the cause!
“The concept of resilience shouldn’t
assume that you won’t fail, but rather that
you should be able to get back up fast.”
In all seriousness, the past two years have shown that the
way we think about our current supply chains as resilient or
Some of the best companies have run more “what if”
robust is a myth. The supply chain has grown so global and
scenarios so they don’t fall into the trap of thinking “this
complex that it has become brittle.
worked for the last eight years, so I’ll continue to do this.”
The concepts of lean manufacturing, just-in-time, or justin-sequence were great when the disruptions weren’t to
this extent. We’ve become extremely efficient in our supply
chain, making the tension so palpable that a single tap could
break it. Traditionally, companies kept lean inventory for ideal
conditions, but if something doesn’t follow the ideal path, their
inventory buffer goes away in 24 hours. You have to keep
enough fat in the system to withstand disruptions.
They have the tools, processes, systems, and culture to
handle these what-ifs. Some companies do sales and
operations (S&OP) planning far more frequently—sometimes
two or three times a week—which shifts the culture to be
more scenario-planning-oriented.
Q: What role should automation play for companies
in the supply chain?
There’s a lot we do that doesn’t require a lot of discretion like
basic planning or forecasting. You can use automation to
“We’ve become extremely efficient in
our supply chain, making the tension so
palpable that a single tap could break it.”
collect the data, refine the data, and come up with intelligence
so a human can make the final decision. At TCS, we have a
concept called the “Machine-first Delivery Model.” Only if a
machine cannot do the work do we send the work to a human.
When people talk one on one, they always recognize what
Q: What makes the difference between those who
successfully adapt and those who don’t?
Well, almost no companies have been left untouched [by the
previous two years]. But the concept of resilience shouldn’t
assume that you won’t fail, but rather that you should be able
to get back up fast.
When you think from that angle, you notice the best
companies have focused on scenario planning. In our
personal lives, we think about contingencies—what happens
they could have done better, but they’re often so pressed for
time putting out fires that they can’t focus on the insights. We
should be focusing on the top 10 percent of disruptions, but
we can’t because the other 90 percent takes up our time.
Q: What is the industry missing? What problems are
particularly thorny to solve?
Everywhere you go, people talk about increasing
collaboration. We all know the importance of connecting
with tier-1 and tier-2 suppliers.
when the kids aren’t on time or your alarm clock doesn’t go
Everyone’s trying to solve this with only technology, but it’s
off? In the professional world, we always plan for an ideal
not going to entirely happen that way due to a lack of trust
scenario. It’s hard to fathom when wars break out, but we
between “different players in the ecosystem.” Technology
must consider them.
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is key but the basic human values and relationship is more
important. I won’t trust you because you build a blockchain;
I’ll trust you because I trust you.
Unfortunately, each player in the external value chain
often worries that providing information such as capacity,
inventory, or internal operational efficiency metrics could
lead to someone else taking advantage of them. It’s a
business strategy, and there’s nothing wrong with that, but
relationships can’t be that transactional. We will all be as
strong as the weakest link, so there has to be a feeling of
“we’re all one big family.” This way, if something breaks, you
can support them immediately.
Q: Any parting thoughts?
I’ve been doing this for a while, and the problems haven’t
changed—we’ve developed new words to describe the
same problems like poor forecasts or bad transportation.
I’ve yet to find a new problem, but I’ve found new words to
describe them.
But what makes me hopeful is that technology has evolved so
much. When I started 20 years back, we didn’t have access to
many technologies that enable prediction, scenario planning,
simulation, and visibility. We are seeing this technology drive
business changes more and more.
The world is more complex and current technology
positions us to better handle this complexity. We’re in a
much better position.
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Adapting to continued supply chain disruptions: Peter
Liddell, Partner, KPMG.
Peter leads the Global Operations Centre of Excellence (incorporating supply chain, procurement &
advanced manufacturing) for KPMG. He has worked with clients across the Asia-Pacific region for
the past 33 years, where he has helped them to enhance their operational and financial performance.
Peter has designed and run large scale transformation programs that have driven value throughout
the clients’ portfolios by accelerating opportunities to mitigate excessive business complexity and
unnecessary operational costs, whilst helping them to position for growth and in accessing new
markets. His key areas of expertise include operational strategy; supply chain and logistics advisory;
business process analysis, improvement, and redesign; and project, change, and risk management.
Since joining KPMG, Peter worked in the consumer and industrial manufacturing sectors but has also
supported a broad range of clients across many other industries including automotive, life sciences,
retail, transport and logistics, telecommunications, energy, mining, and natural resources. Peter is also
currently leading the life sciences industry sector for KPMG in Asia Pacific.
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Q&A with Peter Liddell.
Q: Can you walk us through your view of the big
supply chain disruptors of the past 24 months?
Obviously, the biggest disruption was the pandemic. When
combined with other factors like the Russia-Ukraine conflict,
they contributed to a near-total reduction in passenger freight
and significant reductions in ocean freight, too.
The freight supply and demand equation was a common issue
throughout the pandemic and during the recovery period. Plus,
geopolitical challenges like the Russia-Ukraine conflict also
reshaped global supply chain flows, often adding significant
lead time for most products shipped via ocean freight.
Post-pandemic, we’ve seen the US and EU invest heavily
in infrastructure projects to help rebuild their respective
economies. This has led to a run on manufacturing goods
from China, causing shipping prices to rise at astronomical
rates and leading to containers getting backed up in major
global ports.
Finally, in-country domestic supply chains were also disrupted
[for nations across the globe]. Ongoing COVID-19 outbreaks
often reduced the availability of local workforces needed to
move goods within countries. Ultimately we’ve experienced
a period of unbelievable growth in the demand for goods, yet
limited supply of logistics, both globally and locally. This was a
We also don’t know how long the Russia-Ukraine conflict will
last or what simmering geopolitical issues could erupt in ways
that cause more disruptions. You just need one more issue to
flare up and another major shipping lane might close down.
We’re definitely in for a bumpy 12 – 18 months at least.
The good news is that the global supply chain pressure index,
which measures supply chain stressors, indicates that the
problem has already peaked. How fast supply chain pressures
come down is an open question—new or current geopolitical
conflicts not being resolved could make for a lengthier return
to normal.
There are a number of global challenges contributing to the
second wave of disruptions—for example, everyone is trying
to get their hands on construction materials and equipment,
which may slow down repairs and maintenance of critical
assets or stall new capital projects (retail stores, distribution
centers, manufacturing sites, etc.).
Additionally, many industries producing critical
components such as semiconductors, packaging,
raw materials, etc., haven’t fully caught up. And with
consumption so high, we could face shortages or run out
of critical production inputs. This could lead to more supply
imbalances for critical industries.
perfect storm that I hadn’t seen in more than 30 years.
Q: Has the pain stopped? Or are we still facing a
rough road?
Unfortunately, no, it hasn’t stopped yet. One trend that we will
definitely see in 2023 is continuous disruption. And I also think
that we’ll see a second wave of supply chain risk.
“One trend that we will definitely see
in 2023 is continuous disruption. And I
also think that we’ll see a second wave
of supply chain risk.”
Continuous disruption will be evident in a number of ways.
Organizations will continue to have trouble with transport
logistics as many of the global ocean freight providers haven't
yet caught up to the demand. Even if we can get all the
container ships we need into the ocean, we don’t always have
the crews available, so you’ll continue to have an imbalance of
supply and demand.
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Q: What was the critical factor for companies that
adapted well?
If you peel the onion down a layer, you see that the companies
that did well likely had a lot of safety stock or inventory
stockpiles. Many also turned to premium freight for faster
deliveries, however these strategies are not sustainable. There
was a lot of luck for many of them, to be frank.
Today, companies have started to adapt by right-sizing
their supply chains. Many are looking at different sourcing
methods and revisiting where they do their manufacturing. For
example, they may look at suppliers with really long, in-transit
times that they’ve always done business with and try to find
a closer supplier in order to reduce lead time. It allows them to
be much more agile, often waiting only 3 – 4 weeks instead of
12 for critical supplies.
“Customers expect major companies they
buy from to have responsible sourcing.”
Companies were initially urged by regulators, consumers,
and financial institutions to focus on scope 1 and scope 2
emissions, but now, scope 3 will become a focus in 2023.
Companies need to find where carbon, waste, and highenergy use occurs throughout their extended supply chain
and devise strategies to mitigate their exposures.
One area where companies are investing is full supply chain
digitization. Achieving end-to-end supply chain visibility
provides real-time transparency into how products really
flow through the global supply chain, giving companies real
data on carbon, energy, and waste. A lot of companies think
they know how their products are flowing, but until they
get the real data, they don’t actually know. Digitizing the
wider supply chain and generating real time supply chain
analytics can help.
Q: What topics deserve more thought and attention
than they’re currently getting?
Two come to mind. First, manufacturing footprint
considerations deserve some attention. With the
combination of inflationary pressures, high shipping costs,
Q: What role has environmental, social, and
governance (ESG) played in supply chain thinking?
Well, pre-pandemic, board members and executive
teams spoke about ESG, but at best, it was more about
understanding and setting standards and then signing off
on end-of-year reports.
But ESG has become a larger focus due to consumer
behavior. You can read the studies: customers expect major
companies they buy from to have responsible sourcing. Also,
the global investment community is starting to take action
by calling companies out who greenwash, while refusing
to allocate funds for those not proactively addressing ESG.
They’ll also start to walk away from companies that lack
and geopolitics putting pressure on energy and labor
expenditures, we’re starting to see more investments
into southeast Asian countries like Vietnam, Indonesia,
and Thailand. This signals a shift away from Chinese
manufacturing for many global corporations.
Second, we need to talk seriously about the workforce.
Two years ago, we were expecting enterprise-wide digital
transformation journeys. As companies continue this—by
shifting their enterprise resource planning (ERP) or other
functional technologies to the cloud or putting more digital
power behind procurement, operations, and broader
enterprise activities—they need to focus on how they will
actively train the workforce or find people with the technical
know-how to handle these shifts.
good ESG governance.
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Developing agility in times of change: Joaquim Duarte
Oliveira, Supply Chain & Network Operations Leader,
Deloitte Portugal.
Joaquim is currently the Supply Chain & Network Operations Leader at Deloitte Portugal, bringing
17 years of consulting experience and has worked with clients across industries (life sciences, FMCG,
retail, manufacturing, automotive, construction, and utilities) and geographies in Europe (Portugal,
Netherlands, Belgium, Hungary, Czech Republic, and Slovakia) and Africa (Angola, Mozambique,
and Cape Verde). Joaquim has worked on multiple digital transformations programs and his core
competencies include supply chain planning (demand planning, supply planning, S&OP, S&OE, and
IBP), logistics transformation (3PL), smart factory (data & performance monitoring), digital customer
transformation, market entry and go-to-market strategy, and agile-driven transformations. In addition
to his client work, he has published some market studies related to direct-to-consumer—online
experience and last mile operations, smart factory, digitalization in automotive, and digital health
(prescription and reimbursement digital apps in Europe). He has earned a Global Executive MBA
from the IE Business School with a focus on entrepreneurship and managing global businesses.
Additionally, he has a business management degree from the Nova School of Business and
Economics and completed the Advanced Negotiation Programme “The Game Negotiation Dynamics”
from the NOVA School of Business and Economics.
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Q&A with Joaquim Duarte Oliveira.
Q: Reflecting on the past year, what have been the
biggest challenges in supply chain management?
Q: What technology has been instrumental in terms
of managing supply chain challenges?
The COVID-19 pandemic exposed serious vulnerabilities in
Current technology is better able to support agile and
today’s highly efficient global supply chains. As COVID-19
resilient supply chain processes. Many technologies,
transitions to an endemic state, the world braces for still more
including AI, machine learning, IoT, cloud computing, and
shocks and inflationary pressures driven by sanctions on
data availability, are maturing and offer more capabilities at
Russia and uncertainty throughout Eastern Europe.
a lower cost than before.
Clogged ports and empty store shelves around the world
For instance, scenario planning, which requires handling
speak to the additional work companies must do to make
an enormous amount of data, used to be an issue. The
their supply chains more resilient, even as they face pressure
expansion of computing power and flexible visualization now
to hold down costs. These measures are important and
enables both exception management and near real-time
necessary, but they miss another crucial element in supply
scenario planning.
chain management: agility.
The breakthrough of exception-based planning is due to
Agility offers three important benefits: better and more
the growing computational power that can handle big data
timely data for improved visibility, the ability to execute
combined with increased machine learning capabilities,
faster than the competition, and more integrated,
planning functionalities, and integrated data modeling
collaborative relationships with key supply chain partners.
possibilities. Plus, today’s technology allows companies to
These benefits ultimately enable faster and better responses
integrate planning layers and models to allow for end-to-end
to new opportunities.
visibility and synchronized planning.
Q: When it comes to managing supply chain issues,
how have you seen teams adapt?
In the near future, the vast majority of activities in supply
The capabilities, key performance metrics, and performance
expectations related to agility are not as standardized or welldefined as they are for supply chain efficiency. The focus on
chain planning will be handled by digital solutions, where
predictability, scenario planning, visibility, and agility are
the key elements, leveraged through decision intelligence
and automation.
agility will vary based on a company’s overall strategy and the
design of the supply chain to support that strategy.
However, in our experience, agility can be built in four
areas: demand sensing, collaborative relationships, process
integration, and information integration.
Each area involves building new capabilities—but, more
importantly, they require an understanding of the role of
“Many technologies, including AI,
machine learning, IoT, cloud computing,
and data availability, are maturing and
offer more capabilities at a lower cost
than before.”
agility in creating competitive advantage. Supply chain
managers must strike the right balance between agility,
resilience, and efficiency.
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Q: Which topics around supply chain management
aren’t getting enough focus among the press?
Among organizations?
Talent is already hard to find and attract. While technology
has advanced, supply chain teams need talented people with
skills fundamentally different from those expected of planners
in the past. New hires must be able to think on a strategic and
Also, the talent needed to implement new technologies is
just as rare and usually already [in high demand with low
supply]. How can you attract and retain these gems? At the
very least, make sure to offer them attractive career paths.
Present a perspective on the next steps they could take in a
few years’ time, either in management or in commercial or
analytical functions.
tactical level about scenarios and risks, must have analytical
as well as communication skills, and be heavily marketoriented. With skills like these, they might just as well work in
marketing or R&D.
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Shifting from output to outcomes: Vlad Filippov, Founder
and CEO, Spark Equation.
A seasoned technology industry professional with over 15 years of experience, Vlad Filippov
is the founder and CEO of Spark Equation, a product development and engineering company
based in Chicago that specializes in building intelligent products. Additionally, as the CTO of
Progress Retail, Vlad brings his expertise in data and decision intelligence to his role as a guest
lecturer at Depaul University. Vlad began his career as a self-taught engineer in logistics and
quickly rose to become one of the top logistics consultants for a leading transportation and
supply chain management provider. This experience sparked his passion for bridging the gap
between business and technology, leading him to establish Spark Equation. In his spare time,
Vlad enjoys spending time with his family, reading business and technology books, riding his
motorcycle, and being creative. He is passionate about helping others achieve their product
goals and is always looking for new opportunities to innovate and lead.
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Q&A with Vlad Filippov.
Q: What have the past few years revealed about our
supply chains?
The pandemic was a once-in-a-lifetime black swan event
that showed you can’t always rely on what worked in the
past five or ten years. Events demonstrated that businesses
need to be dynamic in their decision-making and resource
allocation to not only succeed but often to survive. Businessas-usual with five-year plans or long-term roadmaps just
won't work anymore. You’re either adapting, or you’re dying.
As we look to the future, I think complexities will only
increase, and supply chain issues will have a more amplified
effect. Back in the day, businesses were more isolated. Now,
every business is connected, and a change or event affects
Second, employ technology to help with faster decisionmaking. To do this, you must ensure that data is available and
your processes are optimized. This means getting real-time
data so you can know what inputs lead to which outcomes.
Often, this means combining many different paths together.
Companies need to shift focus from outputs to outcomes.
They need to start tracking how they invest and direct
resources and inputs, which requires real-time visibility and
data into results. For example, if you plan to improve customer
satisfaction, how fast can you find that what you’re doing is
working? Is it six months? If you only get that result later and
don’t track leading indicators, then you’re operating blind.
shown that being proactive can’t just be something you talk
Q: You’ve talked a little about interconnections.
How do businesses go about being more connected
with their suppliers?
about in the boardroom: you have to live it. In other words,
Start with compatibility. Before you embark on any project,
you must walk the talk or become obsolete.
the first thing to ask yourself is “will you be compatible?” If you
everything else. Businesses will need to keep track of more
moving parts in the supply chain. The last two years have
choose a software solution that can't connect to other players
in the market, you’ll fly solo.
“Business as usual with 5-year plans
or long-term roadmaps won’t work
anymore. You’re either adapting or
you’re dying.”
If you deploy a new product, you need to have API
enablement built in from the get-go. A public API cannot be
an afterthought—you must have the connectivity upfront
as part of the architecture of your systems or process. This
gives you adaptability.
If your process is too rigid and you’re not able to connect the
Q: With that in mind, how should companies look to
adapt to supply chain issues?
First, there needs to be a mindset shift from backward- to
forward-looking. You need to be more proactive than reactive.
Companies must invest on three fronts: people, processes, and
technology between your company and third parties, the core
of your business will be closed off and you won’t be able to
connect with the rest of the world. As soon as things start
changing, your system might not be effective and you won’t
be able to adapt.
technology. You need to invest in governance to move from
yearly planning to monthly planning. And train your people to
be more dynamic, and put that training and proactivity into
reskilling the workforce as needed.
“Before you embark on any project,
the first thing to ask yourself is ‘Will
you be compatible?’”
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Q: What topics deserve more focus from companies
and the press than they currently get?
Three things come to mind. First, we need to talk about how
complex this industry is. Logistics is one of the most complex
disciplines. I wish the general public knew how many pieces
were involved, so they knew that if something happens in one
given part of the supply chain, it’ll affect everything else. The
public, for example, may want to move to electric vehicles, but
it’s a complex move—you can’t just switch them on overnight.
Second, we need to talk about how we’ll solve the shortage
of truck drivers. How do you solve that problem? Autonomous
vehicles? Training and incentives? If I’m not mistaken, many
truckers today are above 40 or 50. The industry is not getting
younger, and they’ll be exiting the workforce.
Finally, when looking for vendors, ask how they invest in
technology. Instead of choosing the cheapest vendor, look for
those who are investing in technology to be more sustainable
and efficient. Their products will be superior to the products of
a competitor in the long run.
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The role of technology and automation in supply chains.
Across these conversations, some common threads emerged:
often have a mix of structured, semi-structured, and
predicted continued disruptions, the need for agility, the
unstructured data scattered across a disjointed IT
importance of automation, the growing focus on ESG, and the
environment. Sharing data with other companies who
benefits of greater data connections.
are facing similar data challenges just intensifies your
The emphasis each expert placed on the importance of technology
own challenges.
and automation is particularly noteworthy. The right technology—
A process automation platform with a data fabric puts
such as a process automation platform—is critical to helping you
this issue to rest. Data fabrics let developers work with
meet challenges and become more agile and adaptable.
data in a virtual environment rather than performing
Solve the connection problem.
As Filippov put it, “Start with compatibility.” Connecting
suppliers and sharing data is non-negotiable. Companies
extensive database programming. This lets them create
usable, performant applications faster than with traditional
development, letting you connect systems and share data
internally or across companies easily.
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Automate critical tasks.
Automation itself plays a big role in supply chain
management. As Mavatoor put it, “Give machines the first
right of refusal.”
Process automation platforms offer multiple tools—including
robotic process automation, intelligent document processing,
AI, and more—to transfer repeatable processes to machines.
This helps boost efficiency, increase margins, and sharpen
your competitive advantage. Plus, you get more from your
current workforce, alleviating labor shortage pains.
Boost visibility.
Connecting your own systems and integrating with your
suppliers’ IT environments gives you greater transparency
and enables you to make adaptive choices faster. As Liddell
predicted, “Digitizing the wider supply chain and generating
real-time supply chain analytics can help.”
A process automation platform can help you collect data
from across the supply chain, then combine information and
analytics in a centralized location. With this capability at your
fingertips, you’ll notice problems in your supply chain sooner
and be empowered to take informed action.
Increase adaptability.
As Oliveira put it, “In the near future, the vast majority of
activities in supply chain planning will be handled by digital
With automation tools like business logic and AI, you can
enable software applications to make quick decisions on
your behalf. For instance, if supplies run low in a given region,
you can set up rules to either choose a different supplier or
approve premium freight costs to reduce lead times.
Next steps.
In the face of so much ambiguity, the right tools in your corner
can help you not only withstand times of change, but turn
them into opportunities for competitive advantage. And it
doesn’t take an army of developers—it only takes a few.
An enterprise-grade process automation platform can help.
Appian offers four key capabilities:
•
A data fabric to help unify data from multiple sources
quickly, easily, and securely.
•
Process automation tools to help connect people, AI, bots,
and business logic for end-to-end process automation.
•
A seamless total experience for users across web and
mobile devices.
•
Process mining tools to identify bottlenecks, nonconformances, and root cause issues using real-world data.
With Appian, you can get your first supply chain application
built for your organization in just eight weeks. Guaranteed.
Learn more by visiting appian.com/supplychain.
solutions, where predictability, scenario planning, visibility,
and agility are the key elements, leveraged through decision
intelligence and automation.”
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About Appian
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