Organizations can significantly amplify efficiencies across operations, through the optimal management of flows and interfaces between collaborating entities. Requiring a big-picture view of the interaction between the various arms of an enterprise or the sequential stages of a process, supply chain management is a matter of integrating interdependent elements. Rather than merely confining itself to the internal mechanisms of a single organization or entity, the approach focuses on the process holistically and seeks to create coordination across the entire value chain.
Despite their initial application being focused on the manufacturing industry, supply chain management is not limited in value to the factory floor. It adds tremendous optimization to virtually any fabrication process involving sequential stages, and construction is a prime example of an industry that has successfully integrated the practice of supply chain management to maximize output.
Technology can radically enhance visibility into processes through the collation and interpretation of relevant data, adding to the integration and optimization of interdependencies. Data is being recognized as one of the most critical assets to an organization across industries, and there are very compelling reasons why this is so. In any complex and interdependent operation, the ability to leverage efficiencies, such that they magnify each other, is priceless. It’s not merely about bottom lines either. Quite separate from maximizing profit vis-à-vis operating costs, both sequential and concurrent process elements gain massively from the constant control afforded by real-time assessment.
Specifically created to address the requirements of the construction industry, MTWO is a vertical cloud solution that has been developed as a result of a collaboration between RIB Software SE of Stuttgart and Microsoft. A combination of RIB’s flagship product, iTWO 4.0, Microsoft Azure and Dynamics services, MTWO is a viable basis for enterprise-scale digital transformation that can transform the performance of any construction project or enterprise. Used in conjunction with Dynamics 365, this solution can help construction businesses achieve optimal supply chain management.
Optimizing process through digital transformation in the construction industry
Firstly, what is supply chain management? One way to answer that question is to describe what it entails. Essentially, supply chain management involves gaining a firm understanding of the organization in question, from a logistics, workforce, process, performance and resources perspective. With each passing year, buildings are increasing in complexity and now require highly specific design inputs. However, concurrently, the industry is also increasingly fragmented and diversified. The number of collaborating entities and stakeholders, within the industry, is constantly increasing with the growth in specialist suppliers and contractors. Supply chain management is the approach of rationalizing and aligning these various aspects and entities, to achieve the best possible process outcomes.
Introducing transparency, across such processes, can be a transformative business advantage to gain. Some of the benefits organizations can accrue, because of smart supply chain management, include:
Demand visibility. It is often the case that construction industry supply chains are temporary and, therefore, relatively unstable. Relationships in the construction industry are often specific to individual projects and demand – when viewed as a series of competitive requirements tendered by the constituent elements in a temporary coalition – is one of the most effective metrics to track, to gain clarity.
Predictability. Collating and interpreting specific parameters, on a real-time and ongoing basis, creates a mechanism to achieve highly specific results and efficiencies in project implementation.
Allocating tasks and responsibilities. Even a generic construction project can involve significant complexities in assigning responsibility. Entities only a few stages apart, in the supply chain, are in danger of being relatively in the dark about opportunities to leverage each other – without the aid of tools and platforms to facilitate transparency.
Innovation. A comprehensive view of the supply chain involved creates a perspective based on which a construction business can innovate solutions for unforeseen issues or seize unexpected opportunities.
For a construction business to perform optimally, visibility into – and comprehension of – its supply chain is non-negotiable. Being able to operate the best possible collaborative profile, across all stakeholders and parameters, requires unerring and effective supply chain management as well. The peculiarities of the industry, especially in terms of the somewhat ad-hoc nature of collaborations – when compared to many other verticals – mean that rationalization of processes cannot be done based on organizational structure alone. In such a scenario, the management of the supply chain is a classic and proven methodology to interpret performance and exercise control.