Why Businesses Should Support Existing Supply Chain Systems

By Tom Chapman

September 29, 2024

Reading Time: 5 minutes

Mark Holmes, Senior Advisor for Supply Chain at InterSystems, suggests that organizations should prioritize enhancing their existing supply chain technologies.

In the early stages of the COVID-19 pandemic, many businesses—many of which were retailers—rushed to adopt new technologies in an effort to survive a highly competitive market. But was this the right move? Mark Holmes, Senior Advisor for Supply Chain at InterSystems, suggests that policies aimed at enhancing existing systems may be more beneficial than some might think.

Many organizations rushed to adopt new supply chain solutions to mitigate the pandemic’s impact on their business. What are the long-term implications for businesses?

The rush by companies to embrace the latest supply chain technologies is nothing new. Companies often chase trends rather than achieve genuine improvements, and the COVID-19 pandemic undoubtedly intensified this impulse. This led many organizations to make necessary but hasty, reactive changes in their supply chain ecosystems, introducing new solutions without sufficient time for strategic reviews of system integration or a thorough consideration of long-term usage and impact.

As always, these newly adopted short-term effective solutions further complicated the supply chain ecosystem, creating more “legacy spaghetti” issues.

The legacy spaghetti problem—where businesses must contend with multiple systems and solution providers as well as fragmented data points—is a common issue across virtually all industries. Continuously introducing more technological solutions to address pressing challenges only exacerbates the problem. Instead, companies should prioritize enhancing and optimizing existing technologies for greater return on investment and efficiency, supporting future business goals.

How can organizations modernize their technology to leverage resources they already have?

Existing supply chain systems have proven their long-term reliability and effectiveness; therefore, they should not be discarded simply because they are “old.” By optimizing these tried-and-true tools rather than replacing them, businesses can unlock greater potential advantages while minimizing risk and avoiding comprehensive overhauls or increased complexity and data silos.

By adopting smart data architecture frameworks, companies can create a connected organization that extracts more value from existing reliable systems, empowering modern supply chains. This eliminates costly “rip-and-replace” strategies and avoids further complicating the supply chain.

What is a ‘connected organization,’ and how does it help address the ‘legacy spaghetti’ issue in supply chain organizations?

Based on modern data platform technologies, smart data architectures can access, transform, and coordinate data from multiple sources on demand. This allows organizations to leverage available, reliable data for faster and more accurate decision-making.

Data architectures are embedded with advanced data science capabilities, including analytics, artificial intelligence (AI), and machine learning (ML). These capabilities enable supply chain organizations to gain new insights more quickly and easily, driving intelligent predictive and prescriptive services and applications.

By allowing existing legacy applications and data to remain intact, the data architecture approach enables organizations to maximize value from their previous technology investments, including existing data lakes and warehouses, without any need for “rip-and-replace” of current technologies.

This complementary approach avoids further complicating supply chains, shortens decision-making times, and actively provides organizations with insights needed to drive innovation initiatives and enterprise-wide digital transformation.

What else should supply chain leaders consider besides technology to strengthen their operations?

People, processes, and technology are the core of any supply chain organization. Ensuring these three components work together seamlessly is critical. This is why investing in people and culture is crucial for successful digital transformation and ultimately building a robust, resilient, and agile supply chain.

This involves helping employees understand not only how technologies like AI and ML will empower them but also the importance of timely, accurate, and real-time data needs to improve operational agility and resilience.

Resilience and agility are critical in supply chains. How can they be achieved?

Agility is significantly enhanced as organizations can respond more quickly to demand changes, supply disruptions, or other market fluctuations. Staying ahead by enabling technology to support proactive adjustments rather than reactive responses is key.

Optimizing existing solutions for data-driven operations across the organization ensures continuous operational improvements.

Integrating and coordinating data from different and multiple sources provides real-time visibility and insights, ensuring business continuity even in the face of disruptions. Legacy systems retain functionality and value while avoiding costly overhauls, additional manpower or training requirements, and achieving more innovative capabilities like AI. Having all necessary data available ensures businesses can adapt quickly and thrive.

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