What is a unified supply chain, and what are the benefits?
Today’s priorities for supply chain leaders
Over the last three years, the main focus for many supply chain leaders has been resiliency. Disruptions have been rife, with the chain of events starting with the COVID-19 pandemic, continuing with the blockage of the Suez Canal and the Russian invasion of Ukraine, and leading to the impacts of the Red Sea attacks this year.
Resilience can mean different things, from the ability to continue buying inventory and delivering products to schedule, to simply maintaining profit margins. Ultimately, it is about being able to adapt quickly to unforeseen challenges.
Source: Unsplash
A key takeaway from the supply chain disruptions is that the backbone of business resiliency is cost management. At the start of the pandemic, transportation costs increased dramatically, and shippers were buying inventories wherever they could find them. US business logistics costs rose by a record 19.6 percent in 2022, and half of that increase was due to inventory carrying costs.
To remain successful, logistics decision-makers must prioritize both resiliency and cost management. The former means being dynamic and agile, requiring connectedness and real-time data. The latter means reducing expenditure, as high inventory levels and fulfillment & transportation costs could otherwise dent profitability. This is where a unified supply chain helps.
What is a unified supply chain?
Traditionally, in supply chains, transportation and distribution have been managed separately. This siloed approach often led to inefficiencies and missed opportunities for optimization across the entire network. A unified supply chain is an integrated approach to managing all its aspects, from sourcing raw materials to delivering finished products. Components such as distribution, transportation, labor management, and automation work as a cohesive system, usually through a single app. This enables real-time visibility and collaboration across the supply chain network, eliminating silos and redundancy.
At a software level, the Transport Management System (TMS) needs to be connected to the Yard and Warehouse Management System (WMS) to improve operational efficiency. Managers can quickly and easily add capacity, adjust labor to match inbound arrivals, and change orders up to the point that a truck leaves the depot. Such integration streamlines operations, reduces costs, and enhances agility, allowing companies to react quickly to changing market conditions and customer demands.
The benefits of bringing the TMS and WMS together
To achieve a unified supply chain, companies invest in cloud-native software-as-a-service (SaaS) applications, best built from microservices to enable easy integration and scalability. By adopting adaptable and boundary-less solutions, organizations can ensure rapid innovation, personalized customization, and enhanced connectivity across all supply chain functions.
Source: Unsplash
However, according to a recent McKinsey study, logistics leaders have significant concerns regarding technology investment, mostly surrounding the cost of the solution and the impact of change management. Businesses ideally want to lower their total vendor footprint and tech TCO while still boosting their ROI. While these goals may seem at odds with each other, a unified supply chain can ultimately work to achieve them these goals.
A unified supply chain consolidates disparate systems, such as distribution and transport management into a single, integrated solution. Without the need for specialized software for each function, businesses significantly reduce their vendor footprint. This streamlining simplifies technology management and lowers the TCO associated with licensing, maintenance, and support.
Another key characteristic of the unified supply chain is its ease of implementation and adoption compared to traditional, siloed systems. A solution that can be up and running quickly reduces the time-to-value and increases the ROI. Moreover, this lowers support costs by minimizing the need for customization and integration.
Consider Manhattan Active
Manhattan, a leading provider of supply chain management solutions, is the only vendor of a unified supply chain offering. The Manhattan Active Platform gives managers total control over adjuestments for supply, demand, resources, and shipment variations, allowing them to think in terms of inbound and outbound rather than WMS and TMS.
With the platform’s microservices-based architecture and API-first approach, organizations can easily integrate and customize their solution, reducing implementation time and costs. Manhattan Active supports various developmental approaches, including low-code, no-code, and custom coding, enabling IT teams to tailor solutions precisely to their requirements with minimum dependency on external vendors.
Instead of high-cost development to alter monolithic applications, internal teams can easily tune the platform to suit end-users’ requirements quickly and iterate on improvements according to need. And because the platform is cloud-based, core functionality is not affected.
By leveraging computational and behavioral intelligence, the platform optimizes decision-making processes and workforce productivity, ultimately driving cost savings and revenue growth. Manhattan’s cloud-native SaaS model eliminates the need for on-premises infrastructure, reducing maintenance and support costs while increasing scalability and accessibility. Continuous updates every 90 days ensure access to the latest capabilities without additional investment.
To learn more about how bringing together your TMS and WMS into a unified supply chain could transform your business, contact the expert Manhattan team today.
