Digital supply chain solutions for visibility, quality, and compliance.
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Ask the expert, Pharmaceuticals
The global nature of today’s supply chain has resulted in longer and more variable lead times. Plus, a greater number of suppliers, partners, carriers, countries, customers, languages, and logistics channels to work with, as well as increasing costs.
The ability to provide companies with information on the effect that changing customer demand and patient needs, or a delayed delivery, will have on the entire supply chain is just an example of what legacy systems have been unable to deliver to support the level of supply chain visibility needed.
Pharma manufacturers utilize ERP systems, quality management systems, and other digital tools to connect their customers and supply chain. Yet, while businesses often feel that they are drowning in data, they are at the same time having trouble finding insights.
At an operational level, poor data control is responsible for significant supply chain issues, given the silos that often exist, the many points along the supply chain, and the potential for error. These issues prevent companies from making their data work for them to create efficiency and reduce costs.
The COVID-19 pandemic demonstrated that pharma supply chains will need to realign their processes, people, and data to identify improvement opportunities while building resiliency moving ahead.
During the pandemic, we witnessed supplier bottlenecks, delays at airports, harbors, and border crossings, and an increased risk of damage and theft. However, many organizations lacked the visibility to know when issues were happening and did not have the ability to make rapid decisions to respond to them.
If an organization is unable to identify the root cause of its operational errors, it is impossible to get a real handle on the situation.
Often, companies find themselves responding to today’s crisis at the risk of making longer-term decisions, as they lack data that works for them. The value of data does not lie in its quantity but in what can be done with it. Utilizing the right tools and technology to gain understanding will enable control. Control facilitates improvement, and a focus on continual improvement will identify new opportunities.
While collecting visibility data is critically important, it is insufficient on its own. Supply chain leaders need to analyze data, determine root causes, investigate alternatives, and understand their impact and opportunity costs—all to derive insights that drive action.
In response to these challenges, the pharma supply chain control tower has arisen. A control tower acts as a centralized hub, using real-time data from existing systems, integrating with other systems, processes, and tools across the end-to-end supply chain, and driving tangible business outcomes.
Control towers are designed not only to provide the required visibility to survive and thrive, but they should also be able to discern real-time key performance indicators (KPIs) populated by data from across the extended supply chain.
A pharma supply chain control tower should provide four key benefits to the modern supply chain team, including internal stakeholders, box manufacturers, carriers, and logistics providers:
Visibility – provides real-time access to information across the end-to-end supply chain. Data loggers travel with the products delivering product quality condition along the supply chain so that stakeholders can be proactive and prevent lost loads.
Analytics – contains powerful analytics tools that enable supply chain managers to make sense of visibility data, performing “what if” analysis to facilitate effective, rapid response and root-cause analysis to drive operational and process improvements. This data helps supply chain leaders and quality teams automate workflows, save time, cope with disruption, manage risks, and target opportunities.
Responsiveness – helps ensure that each part of the supply chain knows when and how another segment will impact it, and the monitoring helps enable continuous improvement. It also includes the ability to identify issues and respond to problems before they escalate.
Collaboration — data is the currency of the future, not only because it enables enterprises to make decisions, but because it automatically connects people and processes, which may have been previously siloed, to work towards a common goal. The need for collaboration was evident during the COVID-19 vaccine distribution, where manufacturers, packaging providers, carriers, hospitals, clinics, and governments worked together to keep the vaccines safe. Real-time technology and the pharma control tower were the common thread connecting these stakeholders together.
Understanding enables control. To describe the difference between a control tower and what most companies have through reports and data visualization tools, consider an airport control tower’s role. If air traffic controllers only had visibility into landed planes, the results would be disastrous.
Pharma supply chains should be no different. Yet, many businesses only have visibility into landed products. Many have made substantial investments in business intelligence (BI) tools designed to increase the level of visibility in their supply chain activities. Post-shipment data may be fragmented yet converted into graphs and analysis—but does it add value, or is it just more numbers to review?
To be truly empowering, the pharma control tower not only needs to report on the data in the supply chain, making it practical, but it needs to understand the relationships between people, processes, and products. It must be able to convert data into information and insights and supply the level of responsiveness needed to respond to risk. To do this, the pharma control tower needs to highlight exceptions, shortages, critical orders, bottlenecks, excess inventory, and potential delays. It can only do this if it has much more than visualization capabilities. Instead, it needs to have built-in intelligence.
Replacing descriptive and diagnostic data, which show what happened and why, with predictive and prescriptive analytics that show what will happen—or how we can prevent it from happening—will be crucial to moving forward. Today, most data is descriptive. It uses historical data to provide users with insight into past events, merely illustrating what happened. Diagnostic data uses descriptive information to supply insights into why it happened. Predictive analytics goes one step further and is used to find problems and offer recommendations on the measures needed for the best results, allowing for insights into the issues as well as the answers.
Prescriptive analytics should be included in the supply chain control tower to provide insights that enable businesses to act before delays or deviations affect the end patient or customer. This data controls performance and ensures that the cross-process team understands exactly why issues occur so they can work together to prevent them from happening again. They supply stakeholders with the ability to shape the future and support business strategies, while minimizing losses. This is how true value is generated.
The visibility, understanding, and control that a supply chain control tower provides should allow pharmaceutical manufacturers to identify whether they are obtaining a required level of business performance. These benefits include increased responsiveness, less waste, improved compliance efforts, reduced cost-to-serve, and better controlled risks.
They should identify shortage issues before they affect the end patient. Control towers that leverage on-demand technologies supply real-time alerts to stakeholders and suppliers to excursions or deviations requiring immediate resolution—during shipment and after. Any issues should be easily found via alerts that are triggered once predefined quality and business metrics exceed their defined tolerances and thresholds, ensuring that the most critical issues are highlighted and resolved quickly.
Finally, today’s control tower should enable supply chain leaders to collaborate and address issues as they surface, thereby increasing their responsiveness, knowing that a supply chain disruption has occurred. Having the ability to respond quickly and intelligently is what differentiates best-in-class solutions from their counterparts.
A control tower should enable cross-functional team members to work proactively to resolve the most pressing issues. The most sophisticated control towers provide real-time dashboard visibility, actionable insights to assess the operational and fiscal impact of issues, greater workflow automation throughout, and proactive services to help pharmaceutical manufacturers respond to problems before they escalate.
The next generation of analytical tools provide transparency and visibility into the complex nature of the modern pharma supply chain and services that facilitate proactive responsiveness. Pharma manufacturers and logistics providers today live in an on-demand world. As a result, they need to be able to understand and use tools easily. The insights available today allow business professionals to detect problems before they occur and to respond appropriately. By identifying all variables in the chain through a control tower, understanding their impact, and turning knowledge into action, supply chain leads can build responsive, collaborative supply chains that are safer and more efficient for everyone.
Ada Palmadottir is Business Development Director at Controlant. With more than 20 years of experience in pharmacy, management, and technology, Ada has extensive international experience in sales, operations, and marketing, specifically in the areas of product, vertical alliance sales, and partnerships related to pharmaceutical products. She is a licensed and experienced pharmacist and earned a Master of Pharmacy from the University of Iceland and a Master of Business Administration from the Norwegian School of Management in Oslo. Ada has been working with Controlant for more than ten years.