Augmented resilience, performance, and sustainability
will allow organizations to take a customer-centric focus#GetTheFutureYouWant

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Introduction

How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

The supply chain is no longer anafterthought in business meetings.
Supply-chain leaders are now significant
figures in their respective industries
and are at the heart of ongoingtransformation efforts.
Traditionally, supply-chain trade-offs
have been driven by two recognized but
nevertheless fast-evolving forces: a moreconnected, personalized, and real-time
customer experience; and a global value
chain that continuously optimizes the
manufacturing and production costs ofgoods and services.
Resilience and sustainability are topics
that must also be considered carefully in
any modern business plan. Sustainability
is a priority for all stakeholders, who
are putting pressure on organizations
to reduce CO₂ emissions and improvelabor practices all along the supply chain.
Resilience is essential for organizations
to overcome the external, unforeseen

shocks – such as the COVID-19 pandemic,
the war in Ukraine, the recent blockageof the Suez Canal, and rising energy
shortages – which are becoming more
frequent and severe, impacting both top
and bottom lines. Imperatives arisingfrom consumer preferences and a societal
push for localization are also exacerbatingthese issues.
Over half (54%) of organizations
acknowledge that their supply chains havealtered significantly in the past two years.
However, while 51% of organizations
have already deployed an omnichannel

54%

of companies acknowledge that their
supply chain has changed significantlyin the last two years.

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Introduction

How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

strategy, only 27% are implementing endto-end supply-chain transformation thatwill integrate front and back offices.
Our research found that 45% ofcompanies absorb a significant portionof the cost increase due to resilience,sustainability, and customer-centricity
efforts, while remaining unaware of theirtrue end-to-end baseline. Also, 35% find
it difficult to balance objectives that may
be ideologically complementary but often
compete for resource, particularly in aperiod of high inflation. In this context,
while supply chains have changed a
lot under the pressure of events, thefoundations from which to move forward
are not yet in place. Organizations havean opportunity to build intelligent supply
chains that are more efficient, resilient,and sustainable, allowing for a focusedcustomer-centricity.

In August 2022, we conducted an online
survey of 1,000 organizations across theconsumer products, retail, manufacturing,and life sciences sectors. We also
conducted in-depth interviews withorganizational leaders. In this research, we
aim to answer the following key questions:• What is the new supply-chain paradigm?
• Are organizations equipped to become
part of an intelligent supply chain?
• Is the move to an intelligent
supply chain a holistic andstepwise transformation?
• What can be learned from the best-inclass intelligent supply chains?
• How can organizations overcome
key challenges on the roadto transformation?

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Executive
Summary

How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

One of the cumulative effects of thecrises of the past three years has been
to redefine supply-chain priorities.
Operational efficiency/cost reduction,
resilience, and agility to support new
business models are the top threepriorities, followed (at some distance) bycustomer experience and sustainability.
While this seems like a significant burden
on organizations, in practice and to put
things in perspective, all these priorities
interact with and complement each other;moreover, progress in this direction will
see several benefits down the line:• Getting supply chains in shape now
will optimize resource consumption– particularly important in a periodof high inflation – as well as enhance
resilience, while significantly improving
both sustainability and the customer
experience.

• The smart and sustainable products tobe launched in the next few years will
progressively reshape the whole value
chain, from sourcing through design,
production, and recycling, transforming
the customer experience in parallel.
• Greater resilience and sustainability
will also drastically enhance brandreputation with all stakeholders,
facilitating access to different sourcesof funding; improving working
conditions; such qualities will give
ethical credibility and a sense of
purpose to organizations – significant
weapons in the ongoing war for talent.

Customer experience : Online
purchasing, faster order fulfilment,
hyper-personalization
Globalization and resilience : Secured
market access (suppliers and customers),
relocation, product platforming(hardware and software)
Sustainability : CO₂ reduction,
sustainable design /sourcing,supplier diversity

The main market trends to be addressedconsistently are the following ones:

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Executive
Summary

Fewer than 20% of organizations currently
consider themselves to be equipped tohandle those different challenges withconsistent success.
Industrial organizations are fully awarethat moving towards a digital intelligent
supply-chain model will require holistic,
stepwise supply-chain design and systemicrisk management, from forecasting andplanning to execution and governance.
Achieving this will entail constructing
composable IS/IT architecture thatcombines a transactional backbone;
best-of-breed solutions by industry; anddata-sharing and collaborative platforms
to break siloes and provide end-to-end
visibility and traceability. In addition totechnology, governance, capabilities,
extended ecosystems, and collaboration
will be key to progress, as will a viableeconomic model.

Over the next three years, organizations
plan to increase their supply-chaintransformation investments by 17%
on average, and expect to double theirbusiness outcomes in terms of growth,
profitability, and sustainability.
A small group of companies – about
10% of the sample – have already laid
the foundations, consolidated theirinvestments, and begun to realize at least
20% higher benefits. Organizations could
learn from the best practices of thesefront-runners.

20%of organizations consider they are
equipped in handling supply chain
challenges consistently.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

ORGANIZATIONS ARESTRUGGLING TO EMBRACE THE
NEW SUPPLY-CHAIN PARADIGM

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

The crises of the last three
years have produced a newparadigm and set of priorities
for the supply chain
Supply-chain trade-offs are no longer
driven purely by the traditional forcesof customer experience and the global
value chain. Organizations must now
consider two new forces: resilienceand sustainability. In our survey, 45% oforganizations state that their supplychain cost base has increased over the
past three years to accommodate thepush to improve resilience, sustainability,
and customer-centricity. However, thesebusinesses do not feel in control of theirend-to-end baselines.

Fig.1
Efficiency and continuous cost optimization, resilience, and agility are the highest
supply-chain priorities among organizations

Highest ranked supply-chain priorities among organizations

58%

Eﬃciency and continuous cost optimization

53%

Resilience49%

Agility to support new business models

Sustainability

Customer experience

26%

22%

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022,
and Supply Chain Survey, August–September 2020; N=1,000 organizations for each.
Note: Survey respondents were asked to rank the top five priorities of their organization’s supply chain, from 11 options.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

CONSUMER PRODUCTS••RETAILThe top two supply chain priorities of the consumer products organizations are
eﬃciency and cost optimization and agility to support new business models.
Unilever’s eCommerce sales in India saw double-digit growth in 2021. Throughdirect-to-consumer platforms, Unilever is expanding its digital footprint. In 2021,
Lakme, the most-followed Indian beauty brand on Instagram, earned 30% of its
revenue through digital channels.

••

MANUFACTURING••

The top two priorities of the retailers are localization/regionalization (which includes
the agility to adapt to severe disruption resulting from events such as, geopoliticalcrises) and resilience (including diversiﬁcation, contingency planning, etc.).
Walmart has introduced automation to its existing facilities, improving the eﬃciencyof transportation of products from distribution centers to outlets facilitating
freight-handling at its regional distribution centers.

LIFE SCIENCES

The top two priorities of the manufacturing supply chain are localization/
regionalization and resilience.
Tesla has a dedicated responsible-sourcing program for three priority minerals in its
battery supply chain, allowing it to engage directly with local suppliers, rather thanrelying on midstream companies. In addition, Tesla builds its own cells in its“gigafactories” and recently launched its 4680 battery in collaboration with Panasonic.

••

The top two priorities of the life sciences supply chain are supporting new businessmodels and localization/regionalization.
Pﬁzer operates one of the most sophisticated supply chains in the industry, withover 40 owned sites and 200 suppliers globally, providing capacity as required. It
successfully manufactured more than 3 billion doses of the Pﬁzer/BioNTech
Covid-19 vaccine in 2021 and expects to manufacture 4 billion doses in 2022.

Source: Unilever Annual Report 2021; Walmart Group, “Chain Reaction: We’re Partnering with Symbotic to Bring High-Tech Automation to Our Supply Chain,”
July 2021; Tesla Group, Impact report 2021; Pfizer Group, “Expanding COVID-19 Manufacturing Efforts to Increase Global Vaccine Access,” 2021.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Thirty-five percent of organizations
find balancing these (often conflicting)objectives difficult and only one in six
considers itself well-equipped to handle thisnew paradigm in practice. Below, we unpack
the trends making an impact on supply
chains and make our own assessment of
how well-equipped organizations are to
manage them.

Five in six organizations
feel ill-equipped toaccommodate the new
supply-chain paradigm
Organizations are poorly prepared
to offer a more connected,
hyper-personalized real-time
customer experience
Overall, 90 percent of organizations say
growth in the volume of online purchases
will impact them, but only 16 percent are
well equipped to handle this (see Figure2). Two related factors – shorter orderfulfillment times and more personalized
products and services – are also impacting
the supply chain. Seventy-four percent oforganizations agree that shortening orderfulfillment times will impact them but only

Fig.2
Customer experience trends across regions, and by industry.

Customer experience trends
90%

Growth in frequency of online ordering

All Industries

Faster order fulﬁlment time
Personalized products and services
Move from products to services

B2B

Customer collaboration (Product development,
forecasting, and planning)
Enriched customer experience

B2C/B2B2C
Hyper-personalization

High business impact

16%
74%
11%
63%
9%
76%
13%
73%
11%
74%
13%
71%
9%
Ability to address

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

11 percent are well equipped
to do so. At the same time, 63
percent of organizations agree
that personalized products andservices will impact them but
only 9 percent are well equipped
to handle this.
Additional trends that businessto-business (B2B) organizations
cited as likely to impact them but
for which they are not prepared
include:• The pivot from products toservices (76 percent versus 13
percent)• Collaboration with customers
to improve productdevelopment, forecasting,and planning (73 percent
versus 11 percent)• Supply chain for mass productpersonalization (73% versus
12%)
New digital services will drive
servitization and value creation,
while impacting the supply
chain in the following areas:development of digital apps
to monitor personal goals;

connected products and remote
services; use of digital apps
and handheld devices to collectusage data.

Fig.3
Organizations are not equipped to address globalization trends

Globalization trends – impact and preparedness

Globalization and resilience:
Distributed supply chain
is the next frontierOver the past three years, the
COVID-19 crisis has drasticallyexacerbated supply-chain
fragility: three-quarters oforganizations globally have been
impacted by the closing downof facilities, supply disruptions,employee absences, and theimperative for remote work,
while less than 20 percent are
well equipped to handle thesechanges. As many as 92 percent
of organizations say the ongoingrelocation of the global
supply chain will impact them,but only 15 percent are wellequipped to handle it (see Figure3). Apart from under-capacityand mono-sourcing, de-risking
is also an issue that 69 percent
of organizations said will impact
them but for which only 11
percent are prepared.

Relocation of global trade

All Industries

Connected and secure supply chain
Under-capacity situations or de-riskingof mono-sourcing
Data-driven supply chain

B2B

Collaboration across all tiers
End-to-end systemic-risk management

B2C/B2B2C

92%
15%
67%
9%
69%
11%
10%

75%
16%
73%
17%
73%

Supply chain for mass productpersonalization

12%

Direct online and conveniencestorage points

12%

High business impact

77%

71%

Ability to address

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Organizations are shifting
their supply chains to
use more local suppliers
and manufacturers.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.4
25% of global trade will relocate in the next three years

Geographical distribution of
supplier base
57%

57%

43%

GlobalCurrent

43%

Regional or Local
In three years' time

Geographical distribution of
manufacturing base
57%

56%
44%

GlobalCurrent

43%

Organizations are pivoting their supply
chains towards more local regional andsuppliers and manufacturers: between
2022 and 2025 the share of regional or
local suppliers is set to increase from 43
percent to 57 percent and manufacturers
from 43 percent to 56 percent. Houssam
Hage, Senior VP of Supply Chain, Stellantis,
adds: “Strategic sourcing may be considered
as local, to ensure there is no dependence on
any war-constrained countries or vulnerability
to supply-chain disruptions, such as the recent
blockage of the Suez Canal.”

Regional or Local
In three years' time

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

90%

of organizations say growth in thevolume of online purchase will
impact them

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Resilience: A multidimensional andlong-term investment
Resilience will impact operating
models and improve proximity,
reducing carbon footprints
and non-cost competitivenessmetrics such as quality levels
and delays.
Overall, 94% of organizations
say securing market access towithstand more frequent orsevere disruptions will impact
them but only 11% are wellequipped to handle this (Figure5). While balancing ‘just-intime’ and ‘just-in-case' supply
strategies was cited as a key areaof impact, only 6% are wellequipped to do so.

Transition to a sustainablesupply chain is not
obstacle-free
Organizations are implementing
multiple sustainability initiatives,
including carbon-footprint
mapping and reduction,
sustainable design, andsustainability metrics. Over

Fig.5

time, sustainability will reshape
entire business models, fromdesign though operations
to product manufacturing
and service delivery. This
will require significant effort
and investment.
Ninety-five percent oforganizations say the push to
reduce CO₂ emissions acrossall tiers of the supply chain will
impact them, but only 13% arewell equipped to accommodate
this. The move from a linear toa circular supply chain is also a
key area of impact for 68% oforganizations, but only 10% areready to implement it. AmongB2B organizations, critical areasof impact include sustainableproduct development andend-to-end transparency
and visibility; however, very
few can manage this. Twoother significantly affectedareas are sustainable productdevelopment (77% affectedversus 18% prepared) and endof-life product management(72% versus 13%).

Organizations are poorly equipped to handle the impact ofresilience on the global supply chain

Resilience trends – impact and preparedness
Secure customer and suppliermarket access

All Industries

Balance just-in-case resilience withjust-in-time eﬃciency
Deploy pandemic-proof, agile planningand execution

Develop hardware and software platforms
and the circular economy

B2B

Anticipate end-market distortions
Anticipate ecosystem members moving up anddown the value chain

B2C/B2B2C

Enable interoperability between
stock locations
High business impact

94%
11%
64%
6%
66%
11%
82%
9%
73%
14%
75%
10%
69%
11%
Ability to address

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.6
The transition to sustainable supply chain will be a long journey

Sustainability trends – impact and preparedness
CO2 reduction across all supply-chain tiers
Supplier diversity

All Industries

Circular supply chains

End-to-end transparency and visibility
Sustainable products development

B2B

End-of-life Product Management
Eco-sourcing

B2C/B2B2C

Returns and management of
second life of productHigh business impact

95%

13%
73%

10%

68%

10%

68%

8%
18%

77%

“Strategic sourcing should
be local to ensure there
is no dependence on any
war-constrained country or
vulnerability to supply-chain
disruptions, such as the recent
blockage of theSuez Canal”
Houssam Hage
Senior VP of Supply Chain,
Stellantis

72%

13%

73%

13%

70%

10%
Ability to address

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.7

MAKING SUPPLY CHAINS THE
FOCUS OF GREEN INITIATIVES
Organizations are committing to greater
sustainability of products and services as acentral strategic imperative. However, such
ambitions cannot be achieved without astrong focus on supply-chain sustainability, as
supply chains account for over 90 percent oforganizations’ GHG emissions.

is driven by the organizational goal ofcarbon neutrality.2 However, much of the
supply chain’s carbon footprint is generated
under scopes 2 and 3, especially withinmanufacturing organizations. Moreover,most organizations lack reliable scope-3
emissions data.

Historically, organizations have placed
greatest emphasis (38 percent) on scope-1
emissions, which are from sources that theorganization owns or controls directly. Less
attention (22 percent) is given to scope-2
emissions (which are indirect, such as thosecreated in generating electricity used by
the organization) and scope-3 emissions (27percent). Emphasis on scope-1 emissions

Most scope-3 emissions arise from activities
related to customers and the supply chain.
Working with a wide range of suppliers andcontractors makes it difficult to identify thediscrete impact of the carbon footprint ofeach of these, but this task can be madeeasier through collaboration between
supply-chain members.

More organizations are optimizing social sustainability costs in
2022 than in 2020

% of organizations optimizing the following costs
56%

44%

44%

37%

Social sustainability ( labor conditions, healthand safety of workers )2020

Carbon footprint
2022

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022, and Supply
Chain Survey, August–September 2020, N=1,000 organizations each.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.8

Only one in four organizations
is scaling sustainability
supply-chain initiatives

Measure sustainability credentials of products/services

DesignStrategy

Identify emerging sustainability trends(such as product circularity, micro-plastics,
divestment of carbon-intensive assets, etc.)

Procurement &Logistics

One in four organizations has started scalingsustainability initiatives in their supply
chains, most commonly in procurement andlogistics. However, the most implemented
use case of measuring the carbon footprintof purchased goods/services as well as
customer usage is at only 24 percent.
Similarly, only 18 percent of organizations
have implemented a robust supply chain
for returns, and just 15 percent haveembedded sustainability metrics and actionplans for returnable packaging and reverse
supply chains.

Sustainability use cases in supply chain(% of organizations deploying at multiple sites)

Returns

In our research, we found that organizations
are learning to optimize sustainabilityrelated costs in their cost structure. While
56 percent of organizations were able tooptimize costs on social sustainability in
2022 compared to 37% in 2020, this figure
has remained the same, at 44 percent, forcarbon footprints.

Fewer than one in four organizations is deploying sustainability
use cases at scale

22%
17%

Mechanism to measure impact of technology
adoption (green AI)

25%
19%

Sustainable design (green product/process)Measure carbon footprint from purchased
goods/services, as well as end-customer
usage/disposal
Closely collaborate with suppliers to improve theirsustainability ratings

24%
21%

Robust supply chain for returns(including scarce materials)
Embed sustainability metrics and action plan (such as
returnable packaging, reverse supply chain for returnof EV battery components, etc.)

18%
15%

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022, and Supply Chain
Survey, August–September 2020, N=1,000 organizations each.1. CDP. Transparency to transformation: A chain reaction.
2020 Global Supply Chain Report, February 2021. 2. Capgemini Research Institute, Sustainability in Manufacturing
Operations, Business executives survey, February–March 2021, N=480 businesses.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

In the past two years, organizations
have focused on survival,
neglecting cost reduction
Supply-chain complexity has increased
in recent years. An end-to-end supply
chain can involve thousands of suppliers,
while customers demand more tailored,sustainable products and more efficientorder fulfillment. Disruptions of the kindthe business world has seen in recent times
can affect the most robust systems.

45%of organizations are absorbing asignificant portion of increased
supply-chain costs

In the past two days, owing to volatility
in labor and commodity markets, costoptimization has come under pressure. The
number of organizations optimizing rawmaterial costs has declined drastically in thistime, from 61 percent in 2020 to 38 percent
in 2022. Transportation and labor costs
have spiraled out of control. A new focus
on social sustainability is evident, as moreorganizations (56 percent) are optimizingthese costs compared with those in 2020
(37 percent).
Furthermore, we found that, while failing to
get to grips with their end-to-end baselines,
45 percent of organizations are absorbing asignificant portion of increased supply-chain
costs due to resilience and sustainability,with manufacturing (48 percent) suffering
most in this respect, while life sciences (35percent) organizations fare best.

Supply-chain changes happen slowly
Organizations understand that emerging
trends and drivers could have a longlasting, transformative impact on supply
chains, which, for 68 percent of them, areCapgemini Research Institute 2022

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.9
Cost-optimization has fallen away in recent times

Share of organizations optimizing the following costs
38%

Raw materials

Transportation

61%
32%
57%
41%

Maintenance

56%
45%

Inventory

56%

Federico Baiocco
Head of Supply Chain, Iveco

53%
55%

Operations (Warehouse+Production)

37%

Labor

2022

“We have to increase the amountof data that we provide to our
suppliers, as well as the data
our suppliers provide to us,
including long-term forecasting,production data, scheduling,stocktaking, etc. Currently, we
have some information fromsuppliers, but we are not awareof what is behind that supplier.
We need to share the problem
and find the solution together.”

54%
2020

Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022,
and Supply Chain Survey, August–September 2020, N=1,000 organizations each.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

a key priority. Yet the pace of change isslow due to the multiple challenges facedby organizations. Only around half (54percent) stated that their supply chains
have changed significantly over the past
few years. Even fewer (27 percent) are
implementing comprehensive supply-chaintransformation programs. Less than 40
percent of organizations have adapted their
IT infrastructures, adopted a data-driven
culture, and established collaboration
systems for suppliers, customers, and otherpartners (Figure 10).
Organizations have reported lower maturity
in several different aspects of their supply
chains than in the previous survey, due toshifting priorities during COVID-19. In 2020,
for example, 54 percent of organizations
reported having a mature IT infrastructure
to support digitalization, compared with
31 percent currently. Data-sharing-culture
and data-governance maturity fell from 64
percent and 54 percent to 41 percent and35 percent, respectively. Some underlying
reasons for this are greater localization andfragmentation of supply chains; ad-hoc

Fig.10Foundations of intelligent supply-chain transformation are notyet in place% of organizations making signiﬁcant changes to the below aspects of supply chain
53%

Sustainability-driven practices/cultures

46%

Business and IT Collaboration
End-to-end risk management

42%

Data governance42%

End-to-end cybersecurity

41%

Ecosystem empowerment and extended
collaboration with customers,suppliers, and partners

39%

Data-driven practices and culture

38%

Transformation governance and beneﬁts tracking

30%

Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.11
arrangements put in place in response tounpredictable availability of inventories; or
simply a more realistic self-assessment byorganizations, recognizing vulnerabilities intheir supply chains. All of this has increased
pressure for upskilling and reskilling
employees in supply-chain management.
Only 43 percent of organizations claim
to possess a skilled workforce to deal
with the changes, compared with 55
percent previously.

Intelligent supply chain: A holistic
and stepwise transformation
A successful intelligent supply-chain journeymust consistently address new businessand technological challenges, from supplychain design and systemic-risk management,
through forecasting and planning, to
execution and control:Intelligent network design and risk
management: Segment end markets andchannels, differentiate service offerings,
and design and set up an intelligent supply
chain network enabling the best “resilienceperformance-sustainability” compromise,
while monitoring systemic risks over time

Organizations are more realistic about their supply-chain
maturity than previously% of organizations citing high maturity in the below aspects of the supply chain
39%
44%

Collaboration with external entities–suppliers,
distributors, retailers, etc.

35%

Data governance (managing the availability, use,
integrity, and security of data)

54%
31%

IT infrastructure that supports supply-chain
digitalization

54%

Skilled employees (digital and soft skills, including
analytics, technology, tools and applications, data-driven
decision making, adaptive leadership style, etc.)

43%
55%

A culture of cross-functional collaboration anddata sharing

41%

Access to and use of near-real-time datafor decision-making

43%

2020

64%
69%

2022

Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Smart forecasting and integrated businessplanning: Integrate end-customer data,sense the ecosystem, improve forecast
accuracy and constantly ensure relevant andconsistent planning across all tiers to better
serve customers while improving company
performance

Supply chain as a service: Leverage trusted
partners to outsource while digitizing andautomating supply chain processes and tasks
to focus on higher levels of arbitration andinnovation

360° sourcing analysis and suppliercollaboration: Define and deploy “resilience-performance-sustainability” metrics to selectsuppliers and continuously fuel suppliercollaboration and performance improvement

Supply chain control tower andend-to-end performance management:
Ensure end-to-end visibility, traceability,
responsiveness and transparency for endcustomers while deploying a consistent
performance management system across all
stakeholders

Touchless and agile order to delivery: Ensure
a seamless, rewarding and efficient end-toend omni-channel and personalized customer
experience, including upcycling

Composable IS/IT architecture combining atransactional backbone/enterprise resource
planning (ERP), best-of-breed solutions byindustry (notably in relation to execution),

54%of organizations reported having amature IT infrastructure to support
digitalization

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.12data-sharing and collaborative platforms tobreak siloes and provide end-to-end visibility andtraceability will be required. Smart forecastingand integrated business planning are priorities
for both original products (79%) andaftersales (73%).
The shift to an intelligent supply chain requiresa holistic, stepwise transformation acrossmultiple dimensions. Intelligent network designand systemic-risk management are essential tobetter balance the supplier network, considering
the requirement for improved resilience andsustainability. Only 23% of organizations
currently believe they have the ability toaddress this.

Moving towards an intelligent supply chain requires a holistic,
stepwise transformation

Moving towards an intelligent supply chain requires a holistic
and stepwise transformation
80%Intelligent network design and systemicrisk management
Smart forecasting and integrated business planning
Data and AI foundation to break siloes
Touchless and agile execution
Supply chain control tower and E2E performance
management
Supply-chain-as-a-service
360° sourcing analysis and supplier collaboration
High business impact

23%
76%
11%
75%
9%
74%
13%
74%
14%
73%
11%
73%
17%
Ability to address

Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Intelligent supply chain: A holistic and stepwise transformation
The path towards an intelligent supply chain entails addressing critical use-case-driven
challenges while architecting the future:

Key Topics
INTELLIGENT NETWORK DESIGNAND RISK MANAGEMENT
SMART FORECASTING AND
INTEGRATED BUSINESSPLANNING
360° SOURCING ANALYSIS AND
SUPPLIER COLLABORATIONTOUCHLESS AND AGILE ORDER
TO DELIVERYSUPPLY-CHAIN-AS-A-SERVICESUPPLY CHAIN CONTROL TOWER
AND E2E PERFORMANCE
MANAGEMENT

Short-term opportunities and challenges
12-24 months• Micro-segmentation and service oﬀerings diﬀerentiation of service oﬀering• Intelligent network design balancing resilience, performance, andsustainability• “What if?” scenarios• Demand and ecosystem sensing• Smart forecasting and inventories• Integrated business planning and faster S&OP
• Proﬁt-optimized production planning• Green packaging, 3D printing• Supplier visibility and collaboration: planning, quality, delivery• Spend analysis• 360° performance management: resilience, performance, sustainability• E-commerce and online order tracking• Touchless order management and available to promise (ATP)• Cross-company transport• Augmented worker: AR/VR, Exoskeleton• RPA: Good to person (G2P), existing routines automation• Procurement: Sourcing and supplier qualiﬁcation/assessment• Planning: Inventory management, mid- and short-term planning• Execution: Order management, order to cash
• Digital war room and automatic management of usual events• Progressive end-to-end visibility of stock, materials, ﬂows, and delivery status• Cross-function KPIs and incentives• Cybersecurity

Mid-term opportunities and challenges>24 months• Flow simulation and dynamic network conﬁguration• End-to-end risk management: mapping, prediction, mitigation• End-to-end critical-sustainability path assessment and optimization• From supply chain planning to enterprise performance management• Dynamic adjustments of supply-chain parameters (security stock, …)• Continuous, agile, and closed loop planning• Yield management• Supplier collaboration: product design• Sustainability and resilience monitoring across all tiers• Quick onboarding of new suppliers• Dynamic routings: picking, delivery• Real-time location and location-based services (track and trace, instructions …)• Predictive operations: recipes, shipment, …
• Smart real-time resource allocation and planning/scheduling• IPA: Flexible automation, IA-based automation• Supply-chain control tower, alerting and usual event management• End-to-end resilience and sustainability regular assessment• E2E visibility and traceability• Closed-loop learning/AI-based event monitoring• Dynamic pricing• Blockchain: Traceability, smart contract, …

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Only one-third of organizations
have scaled intelligent supplychain transformation initiatives
Two in three organizations are stillin the initial stages of deployment
or are yet to deploy supply-chaintransformation initiatives. On
average, organizations have scaled
only 11 percent of relevant supplychain initiatives across multiple
sites. Supply-chain-as a-service (39percent), followed by 360-degree
sourcing analysis and suppliercollaboration (36 percent) andprocess automation (36 percent)are the most commonly deployed(single and multi-site deployment)
use cases. Across sectors, the picture
is consistent with this overall trend interms of deployed use cases. When
comparing across regions, we see
EU and UK organizations having thegreatest share of scaled deployments(38%), while the APAC region took
the lowest share (30%). Some
organizations are implementing
multiple-process automation
initiatives.
• The BMW Group’s Mobile 3D laser
scanners1 create photorealistic

panoramic images, floor plans,and scatter plots for all vehicle
plants. Production planning canintegrate the virtual product intoa virtual factory at an early stage,
reducing planning effort andcapital expenditure, and ensuring
processes are more efficient andstable• PepsiCo is working on workflow
automation2 for managing searchmarketing strategies by creating
a sales-intelligence platform. The
platform combines retailer datawith PepsiCo’s supply-chain data
to predict when items will go outof stock and prompt restocking toavert supply issues

Around half of organizations
must attain greater businessand technical maturity
Among business capabilities,
organizations rate sustainability
monitoring and implementation (50percent) and e-commerce and ordermanagement systems (46 percent)as the areas in which they are mostmature, while they see planningand ecosystem collaboration as

the least mature. Federico Baiocco,
Head of Supply Chain at Iveco Group,emphasizes the importance of
ecosystem collaboration: “We haveto further increase the amount of datathat we provide to our suppliers, aswell as the data our suppliers provide
to us, including long-term forecasting,production data, scheduling,stocktaking, etc. Currently, we havesome information from suppliers, but
we are not aware of what is behindthat supplier. We need to share theproblem and find the solution together.”17%of organizations plan to increase
their investments in the supply
chain over the next three years• Unilever improved its partner
experience through a new
integrated supplier helpdesk,3with a single point of contact andfaster query-resolution times• BMW and Brilliance Auto Group’s
joint venture4 has established aclosed loop for the reuse of raw
materials from the batteries usedin electric vehicles (EVs); a batterytracing system enables traceabilityof batteries throughout their lifecycles

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.13
Looking at technical capabilities,
organizations are most mature in data andartificial intelligence (AI) as well as execution
systems (43+ percent). Organizations
consider the metaverse, digital twins,and collaborative platforms to be theleast mature areas. Unilever has set up
a Virtual Ocean Control Tower,5 which
provides real-time data related to cargo
location, estimated arrival, etc., helping
the organization to minimize delays andincrease cross-border efficiency

Less than half of companies are well prepared to monitor
supply-chain improvements over time

Share of organizations prepared to monitor supply chain improvements
49%

48%

48%

46%

46%
42%

• Johnson & Johnson has harnessedmachine learning (ML)6 and thetechnologies that underlie it to create
an engine that can accurately predict
demand in real time

Reinforcing governance andperformance is mandatory to succeed
Organizations are not well prepared tomonitor supply-chain improvements overtime. Only 49% of organizations say their
supply-chain leader reports directly tothe board. Just 42% of the organizations
claim that supply-chain key performanceindicators (KPIs) are aligned with thecompany’s broader objectives.

Supply chain
leader reports
directly
to the board

Dedicated
supply chaintransformationoﬃce

Sustainability
leader inputs
are considered
criticalSustainability
KPIs at parwith otherbusiness KPIs

Consistent KPIs Supply chain KPIs
and incentives
aligned withall along thecompany’s
supply chain broader objectives% of preparation
Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Only one-third of organizations
have scaled intelligent supplychain transformation initiatives.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Empowering an extended
ecosystem is a key successfactor moving forward

Challenges aroundeconomic models andtrajectory are sizing

Supply-chain excellence will
also require an empowered,extended ecosystem if it isto translate into operational
excellence. According toorganizations, hyperscalers7
for harnessing the full powerof data and cloud, contract
manufacturers and insurance
firms are the top contributors
who help transform/improve
the performance of theirorganization’s supply chain.

The drive for sustainability can
reshape the entire businessmodel of an organization, while
resilience will mainly impact its
operating model. In both cases,
the degree of effort and size offinancial investments will be very
important over time and should
be proportionate to the scopeand intended business impacts.

Insurance and finance companies
could mitigate supply chain
losses and implement innovative
financing solutions, while energy
and utilities companies cansecure business continuity.

• Particularly in periods ofhigh inflation, optimizing
the cost of operations is
mandatory to support
sustainability and resiliencetransformations. Data-driven
operations are the main leverfor boosting performance,
deploying a virtual model
before undertaking physicaldevelopment; remote work
before in-situ; in-situ but
augmented; and finallyclosed-feedback loop. It will
significantly contribute to

Fig.14
Empower an extended ecosystem: top partners
for operational excellence

Top partners for operational excellence
62%
51%

47%
38%
32%
22%

Hyperscalers

Insurance ﬁrms

Contract
manufacturers

Business services
Energy andcompanies
utility providers

Third-party
logistics ﬁrms

% of top 5 ranks
Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.15Top transformation investments areas

Companies will spread investment across new technologies, capabilities
and change management, and the ecosystem
54%

53%

19%

18%
11%

10%

9%

9%

Collaboration
Digital and cloud
IS/IT integration
Data and AI
with ecosystem
Skills and change
Automation,
IoT and
New operating
management
robotization
connectivity
model

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

sustainability objectives by doing right thefirst time every time while optimizing key
resources consumption.
• In addition, specific sustainable projects
will optimize energy mix and consumption
all along the supply chain as well as
supplier sustainability• At the same time, resilience improvement
will usually increase proximity, reducetransport distance and CO₂ emissions.

the most effective economic model andtrajectory for an industry or a company
will be the key to future success. Such acomprehensive approach and model will
require multi-disciplinary collaboration andextensive investment.

Greater resilience and sustainability will
also drastically enhance brand reputation
with all stakeholders, facilitating access todifferent sources of funding and improving
working conditions. Such qualities will give
ethical credibility and a sense of purpose toorganizations – significant weapons in theongoing war
for talent.

On average, organizations are planning toincrease their investments in the supply chain
by 17 percent over the next three years.
Currently, organizations on average invest
2 percent of their revenue in supply-chaintransformation programs. The top areas ofinvestment include collaboration with theecosystem (54%)
and skills and change management (53%).

Cost and non-cost competitiveness,sustainability, and resilience will impact
each other more profoundly as operational
complexity deepens as well as the customer
experience. Each individual benefit casemust assess the impacts within thosedifferent specific dimensions. Designing

The top three broad areas of investment
are planning, sales and marketing, andquality. In terms of specific investmentareas, organizations plan to focus on change
management and skills, collaboration withecosystem players (customers, suppliers, andpeers), automation and robotization.

Organizations will increase
supply-chain investment toboost business outcomes

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.16
Business outcomes are projected to double over the
next three years

22.0%

24.0%

23.3%

22.1%

17.2%

11.4%

11.1%

11.3%

21.8%

21.6%

17.0%

11.3%

11.3%

11.3%

11.7%
9.6%

Ease ofaccess tocapitalReduction
in CO2emissions

Release ofworking
capitalReduction Net promoter Growth in Market share Growth inin operating
score
operating improvement revenues
costs
improvement
proﬁtBusiness beneﬁts in 2022

Business beneﬁts expected in 2025

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

Houssam Hage at Stellantis confirms
the importance of collaboration to skills
development: “Today, in terms of supply
chain, we are training ‘à la demande.’ So,
when I have an issue, I train up, I fix the issue,
and I move on. We would need a global
plan. An intelligent supply chain is aboutcollaboration with the company, with theconsultant company, or with the internal team,
to define the training plan and implement
it in real time.” Other organizations are
implementing multiple automation
initiatives:• J&J has added capabilities8 such as
track-and-trace devices with GPS signals
and temperature monitoring to address
issues such as theft and counterfeiting• BMW has installed an AI application9that prevents unnecessary movementof empty containers on conveyor belts.
It also uses image data to recognize
whether a container needs to be lashedonto a pallet or if additional securing isrequired for large and unstable boxes
As a consequence, expected businessoutcomes are projected to double overthe next three years according to theorganizations we surveyed.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

THE MANY BENEFITS OF
REVISITING SUPPLY-CHAIN
ARCHITECTURE

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.17
Key attributes of Supply-chain Masters

What can organizations learn
from Supply-chain Masters?
In this section, we will discover how certain
organizations are mastering the new
supply-chain paradigm in practice andgaining higher benefits across dimensions
as a result.
'Supply-chain Masters' are organizations
that demonstrate the ability to meet
multiple demands on their supply chains.
We rated our respondents on the steps they
had taken to strengthen the six key aspectsof supply chains.
Organizations with high cumulative
implementation scores across all of
the above emerged as Supply-chain
Masters. Overall, 9.5 percent (95 of 1,000
organizations) satisfied the criteria.
In Figure 18, we compare the scores ofMasters with those of other organizations.
Masters, on average, heavily outperformed
the other organizations in vision andleadership, efficiency, resilience,customer-centricity, sustainability, andecosystem empowerment.

AspectCharacteristics for scoring

Vision andleadership

Steer and deliver a holistic and stepwise transformation, leadership commitment,
investing in capabilities, and communicating the vision across internal and external
ecosystems

Eﬃciency andcontinuous cost
optimization

Optimize costs and working capital all along the supply chain and balancing withpriorities such as service oﬀerings diﬀerentiation and service levels improvement

Customercentricity

Deploy a powerful omnichannel strategy and seamlessly integrate front and backoﬃce while managing the end-to-end value chain, due to a customer-centriccomposable IS/IT architecture

Sustainability

Consider sustainability KPIs alongside other business KPIs and collaborate closelywith supply-chain partners to improve sustainability all along the product life cycle

Resilience andglobalization

Rebalanced geographical footprint to secure market access, customers andsuppliers, and deploy a just-in-time supply chain within the past three years, andreoriented their supplier base to ensure continuity of supply

Ecosystem
empowerment

Empower an end-to-end and extended ecosystem to securely enrich andpersonalize products and services at speed. Setup close collaborative
platforms with customers, suppliers, and other partners in the value chain

Source: Capgemini Research Institute analysis.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.18

Fig.19Supply-chain Masters maturity matrix

Supply-chain Masters derive 20% greater benefits compared toothersChange in key supply-chain metrics following implementation of initiatives

Masters vs others across six aspects key of supply chain

13.8%

Customer-centricity
24%

4.22

11.1%
2.10
3.76

Ecosystem empowerment

2.13

4.14

21%

11.1%

13.4%

11.1%

15%

13.3%

11.5%

17%

12.8%

10.9%

15%

10.9%

9.5%

4.77

2.72

Sustainability

1.42

1.85

4.22

2.10

Vision and leadership

13.7%
24%

Eﬃciency

4.25
Resilience and globalization
Masters

Others

Source: Capgemini Research Institute, Intelligent Supply
Chain Research, August–September 2022.

Net promoter
Reduction inscore improvement operating costs

Growth inoperating proﬁt
OthersMarket shareimprovement

Reduction in
CO2 emissions

Growth inrevenues

Supply chain Masters

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

50%

share of organizations that saythat their business teams are either
not at all equipped or only slightly
equipped to use emissions data todrive business decisions

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Supply-chain Masters on
average garner 20 percent
greater benefits across
key business metrics
High scores are translating into strong
performance by Masters versus the rest, as
depicted in Figure 19. For example, Masters
reported incremental revenue growthnearly 15 percent greater than that of otherorganizations. Similarly, they derive a 15
percent higher market share, on average.
Supply-chain Masters have invested
significantly in overhauling their technology
infrastructure. They are already mature
in various technologies, affording them abetter understanding of market dynamics,
risks, and vulnerabilities, and providing theflexibility to adjust quickly.
In terms of specific technologies, Supplychain Masters focus on the following
five areas:

Fig.20
Supply-chain Masters are mature in leveraging the full power of
a composable architecture

Deployment level of technologies and execution systems
Has deployed end-to-end cybersecurity tools and methods

42%

74%

Uses AI, bots, and process-mining intelligence to construct'what if?' scenarios
Uses a robust control-tower solution to manage
supply-chain performance
Leverages cloud-enabled collaborative platforms to empower
ecosystems: customers, suppliers, third parties
Has access to data platforms with consistent, clean datasetsfor decision-making
Implements cloud-based solutions to address speciﬁc
supply-chain needs or pain points

35%
76%
31%
41%

69%
41%

74%
82%

23%

40%
48%
83%

Leverages the full power of our ERP platform/software provider
Supply-chain Masters

62%

29%

Has an API and microservices-based supply-chain architecture
Integrates specialized or industry-speciﬁc execution
systems with ERP platform

68%

32%
Others

Source: Capgemini Research Institute, Intelligent Supply Chain Research, August–September 2022.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

• Execution systems (warehousemanagement, transport management,
order management, etc.)• Cloud• Cybersecurity• Data and AI• Blockchain
Supply-chain Masters identify change
management and skills development as
top investment areas. While technology
upgradation is an ongoing process, Masters
pinpoint areas where they see maximum
potential incremental value, aligned withoverall business objectives.

Making the data work harder
Corporate supply chains generate hugeamounts of internal and external data. Whatdifferentiates Masters from the rest is how
fast and accurately they aggregate, analyze,
and act upon that data. US-based industrialproducts manufacturer Honeywell has
digitized over 200,000 customer andsupplier contracts, allowing it to apply

a granular pricing system across its 38
business units, providing some insulation
against rising inflation and ensuring thatdemand is not affected by genericprice rises.
“We have tools that automatically update our
ERP systems. We identified 600,000 SKUs on
which we needed to take price action. And
we were able to do that across 38 businesses
globally in about two days […] Previously, thatwould have taken us eight weeks,” states
Sheila Jordan, Chief Digital Technology
Officer, Honeywell International.10

behavior to yield maximum revenue), whichallows teams to improve material efficiency(minimizing the amount of materials
used) and supplier quality, and ensure
adherence to the standards required to
produce consistent, repeatable products
and minimize waste. Lastly, it is creating
dashboards and alerts for its frontline
teams and site leadership, to allow them totake timely action on high-priority events.
The initiative is expected to deliver $300
million in manufacturing savings over the
next three years.11

Conagra Brands is in the process of digitallyconnecting its manufacturing operations.
The first pillar is connecting all equipmenton production lines to the internet,
providing a constant cross-functional flowof data. The second pillar is the connected
worker, who is able to collect data on amobile device.
The third pillar is yield management(understanding and influencing customer

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Supply-chain Masters
reported incremental revenue growthnearly 15 percent greater than that ofother organizations

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

AN INTELLIGENT
SUPPLY CHAIN WILL
DELIVER ASUSTAINABLE AND
PROFITABLEGROWTHAn intelligent supply chain consistsof key factors including an optimized
customer experience, sustainability, global
connectivity, and resilience, which enablesmart forecasts, strong network design,integrated business planning, predictive
ability, and timely insights.
Successful organizations will balanceadjustments to their geographicalfootprint with securing and nurturing
an ecosystem of partners that will
increase network resilience; deploy
just-in-time efficiency; set up end-toend risk management; and centralize
planning and decentralize execution in acoordinated manner.
Organizations will be able to accessecosystems to provide end-to-end visibility
and deploy harmonized performancemanagement and incentives. Fast-foodrestaurant organization, Yum China
Holdings, rolled out an application of theInternet of Things (IoT) to its entire value
chain, from suppliers to food preparation,
allowing it to track over 90 percent of
inventory accurately, in real time. This helps
it to monitor in-store and warehouse stocklevels, reducing wastage.

Organizations will be able to enrich,personalize, and integrate customer
journeys through the entire product life
cycle, improving demand-forecast accuracy
and reducing order-fulfillment times.
Carrefour, a French retailer, is working on
an automated system that will determine
80 percent of the stock assortment in astore without human intervention, as wellas comparing customer buying behaviors
across stores.3
Organizations will be able to makeefficiencies and monitor performance
while deploying a circular supply chain
and recycling rare resources, bringing
end-to-end transparency and traceability
to product and material flows, andimplementing ongoing sustainability
metrics. J&J’s MedTech business ispartnering with customers on a programthat allows hospitals to recycle metaland plastic components from its singleuse surgical instruments, while also
digitally capturing and communicating
the environmental impact of salvaging
materials. The pilot program is now
expanding to hospitals across Germany andother European countries.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.21
From traditional to intelligent supply chain: complementary challenges

CUSTOMER EXPERIENCE••••

Micro-segment the market and diﬀerentiate
service oﬀerings
Enrich, personalize, and integrate thecustomer journey along product life cycles
Sense the ecosystem and improve forecast
accuracy to anticipate and optimize
Reduce order-fulﬁllment time

SUSTAINABILITY••••

Integrate circular supply chain and recycle rare
resources
Bring end-to-end transparency and traceability
to product and material ﬂows
Fuel and leverage collaboration with suppliersand cross-enterprise synergies
Deploy continuous sustainability metrics

INTELLIGENT SUPPLY CHAIN
RESILIENCE••••

Well balance geographical footprint and secure
an ecosystem of partners
Deploy just-in-time eﬃciency and just-in-caseresilience
Set up E2E risk management and insure supply
chain losses
Deploy pandemic-proof and integrated
planning and operations while centralizing
planning and decentralizing execution

GLOBAL SUPPLY CHAIN••••

Connect ecosystems to provide end-to-end
visibility
Deploy harmonized performance
management and incentives
Anticipate evolving worldwide regulations
Ensure end-to-end cybersecurity
Legend:New forces|

Traditional forces

Source: Capgemini Research Institute Analysis.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

HOW TO OVERCOMEOBSTACLES ON THE
ROAD TO SUPPLY-CHAIN
TRANSFORMATION

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Fig.22
Organizations will need toachieve transformation to create
future-ready supply chains.
In the survey, we segregated theorganizations into two segments: Supplychain Masters and the rest. We analyzed
the practices of Masters and found theydifferentiated themselves across multiple
dimensions, overcoming challenges inplanning and execution through targeted
investments and maintaining long-term
strategic focus. Based on our analysis
and insights from industry leaders, werecommend that organizations follow
the guidelines below to enable them toovercome challenges in implementing
an intelligent supply-chain network(Please refer to Fig.21: From traditional tointelligent supply chain: complementarychallenges):

Guidelines to move towards an intelligent supply chain

REASSESS THE FUTURE READINESS OF YOUR SUPPLY CHAIN TO EMBRACE
THE NEW SUPPLY CHAIN PARADIGM IN ACTION• Start by analyzing the impact of emerging trends on your supply chain and assess yourreadiness to capture any beneﬁts• Recognize missed opportunities over the past few years and test areas of vulnerability
to measure progress• Embrace technology and automation as part of your organization's operational culture

BUILD CAPABILITIES AND SCALE TECHNOLOGIES AS A PART OF ACOMPOSABLE AND INTEGRATED ARCHITECTURE• Incorporate integrated control tower and digital twins into your supply-chain
management systems• Invest in skills and capability building• Clearly deﬁne roles and responsibilities to balance multiple demands

BUILD A DATA-DRIVEN AND COLLABORATIVE CULTURE ACROSS BOTH
INTERNAL AND EXTERNAL ECOSYSTEMS• Create data-driven supplier and customer relationships• Reassess relationships across the supply chain through both resilience andsustainability lens

Source: Capgemini Research Institute analysis.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Reassess your organizational
future-readiness to allow
adoption of the new
supply-chain paradigm
Supply chains of large global organizations
have undergone numerous changes over the
past 2–3 years. Large retailers, for example,
are re-evaluating their distribution andmanufacturing footprints to personalize
the customer experience and drive
e-commerce profitability through omnifulfillment (selecting, picking, packing, anddelivering products across various channels,
involving data-driven synchronization) andautomated warehouses.

To position themselves to cope with future
demand, organizations must start byassessing how ready they are to capitalizeon the emerging trends that have a bearing
on their supply chains. The Supply-chain
Masters in our survey have done exactly
that: 71 percent have stress-tested their
supply chains (using “what if?” scenarios)
compared with only 35 percent of therest. As they reassess their supply chains’
resilience to future shocks and design
new customer experiences, they havemade significant adjustments: 87 percent
of Supply-chain Masters stated that their
supply chain had changed significantly in thepast two years.

Almost 89 percent of Masters have mature
supply-chain network-design practices,
versus 39 percent of the rest. This
reflects the Masters’ understanding that
it is necessary to balance the traditional
demands of efficiency and high levels ofcustomer service with efforts to meetsustainability requirements, ensurebusiness continuity, and nurture resilienceto geopolitical shocks. María Fernanda
Fornells, Senior Director Supply Chain,
Haleon states: “Integrating design, and thenunderstanding what changes are expected andhow those changes could improve the business,
is important. We need a 360-degree approachfor consumers, our internal stakeholders, andthe people that will do the job.”

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Organizations can take the following steps
to refashion their supply chains to meetthese new demands.

Start by analyzing the impact of
emerging trends on your supply
chain and assessing your readinessto capture any benefits
Sixty-four percent of Masters have aligned
their supply-chain objectives with broader
business goals, compared with only 40
percent of the rest. María Fernanda Fornells
comments: “First, determine what you would
like to achieve as a business, and the critical
success factors. Next, take small steps, trying
to collect all the required pieces and build up
an organization-wide scope. Third, ensure thesolution is appropriate to the company. There
are a lot of ostensibly attractive solutions, but
you need to understand what is going to create
a competitive advantage, and focus on that.”
US food company Mondelez is a case inpoint. The organization revisited its supplychain network with a view to making it
more customer-centric (as opposed to
manufacturer-centric). It analyzed theimplications for the consumer of its

processes at each stage of the supply
chain. In 2021, the organization introduced
a 'design-to-consumer' value approach torealize cost efficiencies, while providing theelements that matter most to the consumer.
The organization over-delivered by 50
percent on its goals for the year and has
plans to improve on that going forward.11

Recognize missed opportunities overthe past few years and test areas ofvulnerability to measure progress
Masters focus their efforts on improving
quality, planning, and sourcing to
generate maximum incremental value.
Amid global uncertainties, organizations
face restrictions on the movement ofgoods across borders. In response tothis threat, many have taken steps tostrengthen relationships with top suppliers
to secure an uninterrupted supply of criticalparts. Rolls-Royce, a UK-based aerospaceand defense organization, reduced its
reliance on titanium supply from Russia
by securing a long-term agreement witha US-based titanium supplier. It alsoachieved a 10-percent cost reduction onparts by consolidating spend with fourhigh-performing suppliers.12 Organizations
should revisit core and non-core activities
in their supply chains to increase resiliency.
For example, should transportation beconsidered as a core competency, given
rising freight costs, freight disruptions, andlabor shortages? It should also be noted that
greater localization of products requiresorganizations to build relationships with
regional transport providers.
Similarly, organizations need to adapt
their operating models in response to new
trends. Consumer products (42 percent),
retail (39 percent), manufacturing (42percent), and life sciences (41 percent)organizations have cited the emergence of
new operating models (such as omnichannel
fulfillment and remote working) as a key
challenge. María Fernanda Fornells at
Haleon confirms: “What we've seen is theincredible impact of the e-commerce platforms,
where our consumers buy directly. I think
Amazon and Netflix have created this mindset
of instantaneous service and gratification.
So, customers want products to be delivered
right now. Customers are also moving towards

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

“What we've seen is the incredible impact of the
e-commerce platforms, where our consumers
buy directly. Customers want products to bedelivered right now. Customers are also moving
towards self-service patterns. They don't want tocall anyone and want quick answers. So,
omnichannel communication is key.”

María Fernanda Fornells
Senior Director Supply Chain, Haleon

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

self-service patterns. They don't want tocall anyone and want quick answers. So,
omnichannel communication is key.”

Embrace technology andautomation as part of yourorganization's operational culture
Organizations should automate processes
to generate efficiencies and redeploy
resources to value-adding aspects suchas customer interactions, analysis, anddecision-making. Organizations in retail(52 percent), manufacturing (45 percent),
life sciences (44 percent), and consumer
products (40 percent) have cited federated
and siloed data lakes as a current challenge.
Organizations that lead in terms oftechnology uptake report less downtime,even during severe disruptions. Automotive
supplier Aptiv built a digital twin of its
supply chain, allowing it to plan scenarios
and respond to change quickly. In 2021,
flooding in Belgium and Germany impacted
the organization’s connector business andmovement of some of its raw-materials
supplies. Using real-time information
the organization was able to work with

suppliers in the area, gauging potential
impact, and sourcing alternatives. Withindays, the organization had secured orders
for components with suppliers outside theimpacted region.

(outbound logistics, for example) of their
supply chain. There is a need to upgrade thecontrol-tower model into an integrated andconnected solution that provides improved
visibility for the entire supply chain.

Build capabilities andscale technologies aspart of a composable andintegrated architecture

Yum China Holdings has developed a supplychain control tower to link data from itsotherwise siloed system to allow integrated
management reporting and intelligent
decision support. It created various
dashboards, including: 1) details of supplierperformance and food-safety sampling test

Build and deploy a composable, integrated,and customer-centric architecture,
combining a transactional backbone, ERP,
best-of-breed industry solutions (notably
for execution), as well as data-sharing andcollaborative platforms to break down siloes
and enable end-to-end management, fromsimulation to AI-based event monitoring.

Build and deploy a composable
customer-centric architecture,control tower, and digital twins
Although control towers have been aroundfor more than a decade, implementation
has been patchy. Often, organizations havedifferent control towers for different parts

77 percent of Supply-chain Masters
collaborate with external entities versus
35 percent of others.
results; 2) supply and demand planning, withdetails of demand and inventory forecast
accuracy by segment and by brand; 3) for
logistics centers, with details of inventory
level by product category. The organization
is customizing this report for mobile devices

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

to increase accessibility and connectivity, as
well as faster decision-making.

improve them, but also predict how they
will perform in different scenarios.

At Kraft Heinz, a control-tower solution
provides real-time visibility of plant
operations and automation of supplychain distribution across its 85 productcategories. Kraft Heinz will also create
digital twins for its 34 manufacturing
facilities in North America, to help test
and refine solutions and processes before
implementing them on the plant floor. For
example, the technology will help predict
optimal product capacity and reducemechanical interruptions by proactively
addressing issues before they occur,
ensuring only the highest-quality products
reach the consumer.14

For instance, home-improvement retailer
Lowe’s created a digital twin of one ofits stores to help its associates improve
efficiency of operations and better
serve customers through accessing andinteracting with the store’s digital data.
In the future, the digital twin will enable
new ways of viewing sales performanceand customer traffic; for example, it cansimulate the act of customers or associates
picking up items often bought together toenable time-saving proximate positioning of
those products in stores.15

A digital twin is a virtual replica of a physicalsystem that can model, simulate, monitor,
analyze, and constantly optimize its
counterpart in the physical world. Throughits ability to answer questions such as “whatis best?”, “what if…?”, and “what next?”, adigital twin can not only provide visibility
on how dynamic, real-world systems are
currently performing and propose how to

Supply-chain Masters plug capability gaps
by developing in-house talent (82 percent);
adding new talent through mergers andacquisitions (76 percent); and partneringwith business or IT service providers (74percent). The future-fit supply chain needs
future-fit people. Eighty-one percent
of Masters have skilled employees (withdigital and soft skills, including analytics,
technology, tools, applications, data-driven

decision-making, adaptive leadershipskills, etc.) who can respond to a dynamic
environment, compared with only 39
percent of others.
Attaining consistently game-changing levelsof execution in the supply chain requires
masterful use of digital technologies at thegrassroots level, backed up by organizationwide understanding and commitment. For
example, organizations treating demandplanning as a strategic priority can prioritize
investment in continued upskilling of
demand planners and foster a knowledgesharing community across different

Invest in skills and capability building

81%

of Masters have skilled employees who can respond to a dynamic
environment, compared with only 39% of the others.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

geographies or products. The objective is
to equip employees to compile their own
datasets, which they can then analyze
for purpose.

Clearly define roles andresponsibilities to balance
multiple demands
Organizations in the consumer products(46 percent), life sciences (51 percent), andretail (43 percent) sectors state that lackof clarity on roles and responsibilities is
the most common hindrance to successfultransformation of the supply chain.
Dr. Dirk Holbach, Chief Supply Chain Officer,
Henkel Global Laundry & Home Care, adds:“What we have learned is the main challenge
is not the technology – which is out there,
and you can buy it – it is much more thesoft factors, such as change management.
You have to get both right, and involve yourteams in the transformation journey.” 16 In
the manufacturing sector, 43 percent oforganizations have cited inability to balance
multiple demands as a major challenge.

We found that Supply-chain Masters are
significantly ahead in monitoring supplychain improvements over time:• Around 78 percent of Supply-chain
Masters have a dedicated supply-chaintransformation office versus only 45
percent of the rest
• At 66 percent of Supply-chain Masters,
the supply-chain head reports directly tothe board on the progress of supply-chaintransformation initiatives, compared with
48 percent of other organizations• At 77 percent of Supply-chain Masters,
the sustainability leader’s inputs are
considered critical compared with only 48
percent of the rest of the organizations

Build a data-driven and collaborative
culture across both internaland external ecosystems
Consumer products (38 percent), retail (40percent), manufacturing (36 percent), andlife sciences (38 percent) organizations havestated that cultural pushback to change isthe most common tactical hindrance.
According to Lidia Fonseca, Executive
Vice-President and Chief Digital andCapgemini Research Institute 2022

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Technology Officer at Pfizer: “Pfizer’s movetoward supply-chain analytics has helped
it transform into a leaner, more sciencedriven, more patient-focused organization.
To succeed, we have had to communicate thecompany’s digital strategy clearly, in order toinspire employees’ support and participation.
Our culture was instrumental in encouraging
our employees to be courageous and think
differently in order to accomplish what we
previously would not have imagined possible.”17
Seventy-three percent of Masters have set
up a cross-functional risk-management teamfor supply-chain operations, compared with
41 percent of the rest. At Schneider Electric,strong collaboration between sustainability,
global supply chain, lines of business, andcustomer satisfaction and quality teams
has given rise to new processes, enabling
the organization to revalorize customer
returns. Through the reuse of components
or remanufacturing of new products in theorganization’s local adaptation centers, it
is able to accelerate progress towards its
sustainability ambitions. For instance, it wasable to comply with the upcoming antiwaste law and reduce the carbon footprintof its supply chain. This also translated
into higher customer satisfaction, evenduring component shortages, serving newcustomers and reducing the cost ofquality failure due to lower volumes of
product scrap.18
Similarly, retailer Kroger set up crossfunctional and collaborative in-stockteams dedicated to solving supply-chain
issues, working with its supplier partners
to produce detailed plans to free up
constrained product lines.19

Create data-driven supplierand customer relationships
Supply chains are increasingly driven bygeopolitical events impacting the flow ofmaterials. Moreover, growing demand forsustainable products and more frequent
weather-related disruptions requireorganizations to predict and prepare, rather
than simply react.
New demands on supply chains to connect
to external ecosystems are driven by:• Vendor accountability for sustainablesourcing and procurement• The imperative to secure supply andenhance visibility of critical-parts supply
chains, with organizations requiring
visibility of supplier operations at tier-2,
tier-3, and other levels• The requirement to establish traceabilityof parts to guarantee authenticity andtrack the movement of products• Improving resilience to external shocks• Nurturing agility in responding to trends• Increase diversity and inclusion criteria for
supply-chain vendors (such as sourcing
agri-commodities from small farmers)
Organizations that integrate their systems
externally see the benefits. Our research
revealed that 77 percent of Supply-chain
Masters collaborate with external entities(suppliers, distributors, retailers, etc.),
versus 35 percent of others. Eighty-two
percent of Masters have scaled deployment
of integrated and collaborative planning via
the cloud, compared with only 32 percent of
the rest.
Often, organizations have deployedvarious off-the-shelf solutions, such as
procurement, demand-supply matching,

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Supply chains are increasingly
driven by geopolitical events
impacting the flow of materials.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

and supplier collaboration, leading to siloeddata systems. They need to reset their dataarchitectures to connect to these platforms
and tap into external ecosystems.
Alcoholic beverages organization
Diageo has kicked off several initiatives
to encourage close collaboration with
suppliers and customers. With real-time
shipment tracking, the organization could
determine the status of all global customer
shipments during the Suez Canal blockage,for instance. It determined that the ship
blocking the canal did not contain Diageo
products, but that the organization would
be impacted by the resulting backlog
of vessels. This insight allowed theorganization to communicate proactively
with shipping lines and customers. Diageo
created a virtual incident room, prioritizing
its own shipments and putting contingency
plans into action. The organization is in theprocess of integrating its system with thoseof its customers to unify trade terms andcost-to-serve initiatives, as well as real-timetransport-performance visibility.
The organization facilitated customer
connectivity through the Diageo One

platform, which provides a single digitalpoint of engagement. It enables customers(including bars and restaurants) to view
Diageo’s portfolio of SKUs, place neworders, review historical orders, and view
invoices and billing information. Customers
have access to tools and data that help themgenerate value and accelerate decisionmaking. As a result, Diageo was ranked top
for supply chain and customer service in the
UK and 4th globally, up nine places from2019 and seven places above its nearest
spirits competitor, in the Advantage GroupInternational UK Beer, Wines and Spirits
report.20

Organizations can better harness
technology and knowhow to reduce
emissions at the supplier’s end through thefollowing steps:• Invest in supplier training and education:
Suppliers in most sectors lack the training
and conditioning to tackle emissionsreduction. Furthermore, expectations
are rising to include other social
commitments, such as sourcing fromminority groups, women entrepreneurs,
etc. Large organizations can extend their

Reassess relationships across the
supply chain through both resilienceand sustainability lenses: As supply-chain
emissions are the greatest contributor toorganizational emissions, organizations
can ill afford to ignore sustainability
considerations across supplier relationships.
More than 50 percent of clients at DHL, aleading logistics services provider, request
information on responsible businesspractices as part of their tender processes.21

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

68%
of organizations
recognized the importanceof developing end-toend transparency andtraceability of products.

support to identify the correct starting
points for their suppliers’ sustainability
journeys.
• Set clear metrics for measurement:
Sustainability could mean different
things to different supplier and customer
groups. For each supplier group, set
up transparent indicators by which
their sustainability ratings will beassessed. Ideally, sustainability will be
implemented across suppliers’ value
chains. Focal metrics will help suppliers
prioritize initiatives such as sourcing
sustainable raw materials, packaging,route optimization, green power, green
warehousing, waste management, labor
policy, etc.
• Implement real-time tracking systems
for sustainability: Collaboration not only
enhances sustainability but also helps
organizations obtain real-time data on
supplier operations to ensure quality,
speed, and accountability. Yum China
has built end-to-end connectivity fromthe supplier’s plant to its systems. The
system helps it obtain instant deviation
notifications, trend analysis, and risk
warnings, allowing it to take immediate
action to mitigate risk.22

Sustainability is as much about diversityof supplier base, traceability of source
materials, and workforce wellbeing andsafety, as it is about emissions. Manyorganizations feel they are impacted bythese trends but are not ready to deliver onthem in the near term. Sixty-eight percent
of organizations recognized the importanceof developing end-to-end transparency andtraceability of products but less than 10
percent are able to deliver on these.
A similar number of organizations were able
to ensure supplier diversity (sourcing fromsmall businesses or ones which are owned/
operated by minorities, members of the
LGBTQ+ community, etc.), while almost 73
percent of them cited it as an important
emerging trend. Pivoting towards more
equitable sourcing opportunities requires
educating procurement teams about
how they can positively impact businessperformance by improving innovation,
quality of sourcing, and cost-effectiveness.
It also entails challenging leaders to think
differently about how to include a morediverse set of suppliers. Recognizing this,companies are committing more spend toCapgemini Research Institute 2022

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

diverse sourcing. For example, Mondelez set
a goal to spend $1 billion with minority andwomen-owned businesses globallyby 2024.23
As uncertainty in supply networks increases,
more organizations are prioritizing resilient
operations that show the following
characteristics:• Network resilience: Well balance theend-to-end geographical footprint;
secure an ecosystem of third-party
logistics and contract manufacturers;
ensure end-to-end cybersecurity;
Integrate agility cost in cost to serve
model. Nike, for example, has a fully
outsourced and diversified supply chain
with manufacturing contracted out
across over 500 factories.
• Just-in-case resilience: Increase
flexibility and interoperability within the
supply chain; build up stocks of criticalparts/products; Enable omni-channel
model to balance stock availability acrossmarkets and geographies ; develop multisourcing strategies by engaging multiple
procurement partners– Elevator engineering organization
Kone is adopting multi-sourcing,meaning it will have an alternative
supplier in place not just at elevatormodule level but also at components
and parts level, a policy it will enforce
across its supply chain. It is also
harmonizing supply-chain processes
and IT systems among suppliers toensure products and components
can be manufactured identically in
different locations.2– Stanley Black & Decker, a US industrial
tools and household hardware
manufacturer, is standardizing
components across its product range
to create economies of scale with its
key suppliers. It is simplifying productdesign and consolidating its supplierbase, and reducing time to market on
innovation by sharing design initiatives.
The organization aims to reduce thenumber of stock keeping units (SKUs)
in its system by over 40 percent anddeliver cost savings of approximately$300 million over the next three years.1• End-to-end risk management: Set
up a cross-functional end-to-end riskmanagement team enabled by methods
and tools; develop real-time visibility ofstocks/flows with suppliers and partners
through a shared-data approach.
• Pandemic-proof planning andoperations: Tap into customer/
supplier and delivery data to improvelogistical and post-sale efficiency. Usean integrated collaborative platform
for planning. Implement automatedoperations and goods-to-person
technologies to improve the efficiency
of operations and mitigate unexpectedlabor shortages.

tiers, energy and utility providers). Close
collaboration through real-time data sharing
and setting up integrated systems will add
value to the entire industry value chain.
Organizations can start with identifying
their role in the value chain, finding common
corporate objectives and opportunities toachieve them jointly. For instance, to achieve
its sustainability goals, J&J, together withnine other pharmaceutical organizations,launched Energize, a platform to educate
industry suppliers on renewable-electricity
procurement opportunities and to help
them transition to renewable energy.22

Empower an extended ecosystem
As supply chain complexity grows, anextended ecosystem (third-party logistics
firms, business consultancies, software
vendors, hyperscalers, etc.) becomes
important to realize overall businessobjectives. It helps not only in efficient andintegrated operations, but in managing risks
and access to capital (insurance providers,investment bankers) and improving
sustainable operations (suppliers across all

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

CONCLUSION
Businesses have scrambled to navigate
disruption to supply chains, often caused
by factors out of their control. This has
resulted in several ad-hoc implementations
to maintain service levels.

value chain, from design and procurement,
through to product manufacture andservice provision and recycling, as wellas having a profound effect on thecustomer experience.

In parallel, new dimensions of supplychain performance have emerged. A new
supply chain paradigm is already in action;
Supply chain trade-offs are now driven
by four complementary forces: customer
experience , global value chain , resilienceand sustainability.

Resilience and sustainability will also
drastically increase brand value to all
stakeholders while facilitating access todifferent sources of funding, improving
working conditions and giving employees
a greater sense of purpose, withknock-on positive effects on recruitment
and retention.

Moving toward an intelligent supply chain
is an holistic and stepwise transformationthat will require significant and consistentinvestments and efforts over time.
New smart and sustainable products to belaunched on the market in the next few
years will progressively reshape the wholeindustry or a company will be key to moving
forward successfully. Such a comprehensive
approach and model will require multidisciplinary collaboration and investments
in technology and automation, change
management, skills, collaboration, anddata governance. Changes are happening;
now things need to accelerate, and afaster-moving, smarter supply chain will be
integral to this.

Cost and non-cost competitiveness,sustainability, and resilience will impact
each other as well as the customer
experience. Each individual benefit casemust assess the impacts in those different
dimensions. Globally, defining the righteconomic model and trajectory for an

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

RESEARCH METHODOLOGYTo understand the maturity of intelligent
supply chains across sectors, we carriedout extensive research using both
qualitative and quantitative methods. The
study findings reflect the views of the
respondents to our online questionnaire
and are intended to provide directional
guidance. Please refer to the methodology
for details of respondents and get in touchwith a Capgemini expert to understandspecific implications.

In-depth interviews

Organizations by country
12%
10%

12%

10%

8%
7%

7%

7%

7%

We conducted 10 in-depth interviews withexperts from large organizations who are
involved in the supply-chain domain.

5%

5%

5%

5%

Executive survey
We surveyed 1,000 supply-chain
executives from large organizations
across sectors. The global survey took
place in August and September 2022. The
distribution of selected respondents andtheir organizations is provided below.

Australia

FranceChina

India
Germany

Japan
Italy

Netherlands
South Korea

SwedenSpain

United States

United Kingdom

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Executives by role

Organizations by sector

15%

1%

27%

General Managerof sites (plant,
distribution
center, etc.)

Consumerproducts
RetailDirector / SeniorDirector

Manufacturing
Life sciences

VP / SVP / EVP

32%

26%

45%

54%

Research Methodology

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Organizations by annual revenue

Executives by function
11%

7%

11%

10% 10%Between $1 billion
and $5 billion

18%

9%
8%

Between $5 billion
and $10 billion

7%

7%
6%

6%

5%

Between $10
billion and $20
billion32%

32%

Between $20
billion and $50
billionMore than $50
billion

4%
3%

4%

4%

3%

1%
Corporate
strategy

Procurement/
sourcing

End-toend supply
chain

Demandand supply
planning

Manufacturing
production

E-commerce

Distribution
and logistics

Customer
Quality
Information
Sustainability
supportservices/and services
Information(including
technology(IT)after-sales)
FinanceOperational
DigitalEngineering/
Sales andcontrolling
excellence
design/orderdevelopment/
management
technical services

Research Methodology

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APPENDIXThe following are the questions used
to identify the Supply-chain Masters
for our research. (Figure x)

Axis

Score

Statement

Customer
centricity

5 – Strongly agree 4 – AgreeWe’ve already deployed a powerful omnichannel strategy

3 – Neutral 2 – Disagree

Is leveraging IoT and connectivity for location-based services, real-time tracking and tracing

1 – Strongly disagree

Integrates specialized e-commerce platforms with planning and execution systems
We can implement quick and cost-effective means to adjust to short-term disruptions/fluctuations in our supply
chain
We have an automated order-entry process for all our customers
We have an API and microservices-based supply chain architecture

Sustainability

5 – Very high level of preparation 4 –Maturity of initiatives

High level of preparation 3 – Medium

Sustainability KPIs are considered alongside other business KPIs

level of preparation 2 – Low level of
preparation 1 – Very low level of
preparation
Efficiency

5 – Strongly agree 4 – Agree

Our inventory levels (or inventory turnover) are comparable to the best in the industry

3 – Neutral 2– Disagree 1 –Strongly

Cost optimization

disagree

Automated or robotized processes in the supply chain, where possible
We can run continuous improvements of service levels for each node of the supply chain

Resilience

5– Strongly agree 4 – Agree

Rebalanced our geographical footprint to secure market access, customers, and suppliers, in the past 2–3 three

3 – Neutral 2– Disagree 1– Strongly

years

disagree

Evaluated partners’/suppliers' capacity to fulfill our requirements to ensure business continuity
Systematically deployed multi- as opposed to mono-sourcing strategies
Set up an ecosystem of contract manufacturers and global third-party logistics organizations
Continuously integrated external data (political risks, market surveys, social-media crawling, etc.) to aid decision
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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Axis

Score

Statement

Vision and

5 – Very high level of preparation 4 –We have mastered agile methodologies for working cross-functionally function working within business andleadershipHigh level of preparation 3 – Medium

IT teams

level of preparation 2 – Low level of

Ability to digitally integrate the plan, make, source and deliver functions of your organization

preparation 1 – Very low level ofA culture of cross-functional collaboration and data sharing

preparation

Skilled employees (with digital and soft skills, including analytics, technology, tools, and applications,data-driven decision-making, adaptive leadership style, etc.)
Data governance (managing the availability, use, integrity, and security of data)
Change management, it’s communication and implementation

Ecosystem

5 – Very high level of preparation 4 –Deployed at scale integrated and collaborative planning, leveraging cloud platforms

empowerment

High level of preparation 3 – Medium

Maturity in ecosystem collaborationlevel of preparation 2 – Low level ofStrong collaboration with ecosystem players (customers, suppliers, peers, etc.) – one of the top investment

preparation 1 – Very low level ofareas

preparation

Score level of preparedness to be a Supply-chain MasterGreater than 100:
75-100:			
50-75:			
25-50:			
<25:			

Very high level of preparation
High level of preparation
Medium level of preparation
Low level of preparation
Very low levels of preparation

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REFERENCES
1.

BMW Group, “All BMW Group vehicle
plants to be digitalised using 3D laser
scanning by early 2023,” June 2022.

10. Food Business News, “Conagra
Brands reimagining and renovating
its supply chain,” 4 August 2022.

2.

CIO, “Supply chain analytics: 3
success stories,” Feb 2022.

11.

3.

Unilever, Annual Report 2021.

4.

Marketline, “BMW creates closed
recycling loop for battery raw
materials in China,” May 2022.

12. Rolls-Royce Holdings plc, H1 2022
Earnings Call, 4 August 2022

20. Johnson & Johnson, Special Calltranscript, 21 June 2022.

13. “Kraft Heinz and Microsoft join forcesto accelerate supply chain innovation aspart of broader digital transformation,”
PR Newswire, 21 April 2022

21. Novartis website, Novartis Green
Expectations from Suppliers 2022.

14. “Lowe's unveils industry-first digitaltwin, giving associates 'superpowers'
to better serve customers,” PR
Newswire, 20 September 2022

23. Mondelez International 2021 ESG report

5.

Unilever, Annual Report 2021.

6.

Microsoft, “Johnson & Johnson
advances global health and avoids
supply chain disruptions,” Nov 2021.

7.

Microsoft, “Johnson & Johnson advances
global health and avoids supply chain
disruptions,” November 2021.

8.

Analytics Steps, “How BMW uses
artificial intelligence AI,” June 2021.

9.

Honeywell International Inc. - Special
Call transcript, 3 March 2022.

Mondelez International, Inc. - Analyst/
Investor Day, 10 May 2022

18. The Kroger Co. - Special Calltranscript, 4 March 2022.
19. Diageo plc - Analyst/Investor Day transcript,
16 November 2021. DHL, The logistics
trend radar – 5th edition, May 2022.

22. Yum China Holdings analyst/investor
day transcript, 23 September 2021.

15. https://theinnovator.news/howhenkels-factories-are-unlockingvalue-through-data-sharing/
16. CIO.com, “Supply chain analytics: 3
success stories,” 22 February 2022.
17.

Schneider Electric, Annual Report 2021.

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

KEY CONTRIBUTORS
Jean-Pierre Petit

Frédéric Berne

Mayank Sharma

Digital Engineering andOperations Group Offer Leader
Capgemini
jean-pierre.petit@sogeti.com

Head of Intelligent Supply
Chain CoE
Capgemini France,
frederic.berne@capgemini.com

Vice President | Supply Chain
Capgemini
mayank.q.sharma@capgemini.com

Susan Davies

Idriss Elasri

Clément Falquet

Managing Director, Capgemini
Engineering Morocco
idriss.elasri@capgemini.com

Global Supply Chain Transformation
Lead, Capgemini Invent
clement.falquet@capgemini.com

Vice President, Capgemini Invent
susan.a.davies@capgemini.com

Lindsey Mazza
Global Retail Lead, Capgeminilindsey.mazza@capgemini.com

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

KEY CONTRIBUTORS
Jerome Buvat

Sumit Cherian

Global Head of Research and Headof Capgemini Research Institutejerome.buvat@capgemini.com

Senior Manager, Capgemini ResearchInstitute
sumit.cherian@capgemini.com

Subrahmanyam Kanakadandi

Gaurav Aggarwal

Senior Director, Capgemini
Research Institutesubrahmanyam.kvj@capgemini.com

Senior Manager, Capgemini ResearchInstitutegaurav.aggarwal@capgemini.com

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

The authors would also like to thank Sven Dahlmeier,
Dharmendra Patwardhan, Michael Becker, Delphy Amarat,
Michael Cook, Sébastien Neyme, Brian Eden, Mike
McCullough, Nouha En-Nabty, Andrew Stainsby, Louise
Barbolosi, Moise Tignon, Marie-Neige Couriaut, Azfar
Mallick, Jatinder Kautish, Courtney Holm, Ralph SchneiderMaul, Sergey Patsko, Christian Michalak, Daniel Evers,
Sandip Sharma, James Robey, Ozlem Bozyurt, Sophie Pantel,
Pratyush Dubey, Manisha Dash, Kristin Morris, Manish Sahaand Ashwani Kumar for their contribution to this research.

About theCapgemini Research Institute
The Capgemini Research Institute is Capgemini’s in-housethink tank on all things digital. The Institute publishes
research on the impact of digital technologies on large
traditional businesses. The team draws on the worldwide
network of Capgemini experts and works closely withacademic and technology partners. The Institute has
dedicated research centers in India, Singapore, the United
Kingdom, and the United States. It was recently ranked
number one in the world for the quality of its research byindependent analysts.

FOR MORE INFORMATION,
PLEASE CONTACT:
Global contacts

Regional Contacts

Jean-Pierre Petit

Frédéric Dispa

Digital Engineering andOperations Group Offer Leader
Capgemini
jean-pierre.petit@sogeti.com

Intelligent Industry Leader Southern & Central Europe
frederic.dispa.externe@capgemini.com

Mayank Sharma

Mark Landry

Vice President | Supply Chain
Capgemini
mayank.q.sharma@capgemini.com

Intelligent Industry Leader- Americas
mark.landry@capgemini.com

Clément Falquet

Vikas Kumar

Global Supply Chain
Transformation Lead,
Capgemini Invent
clement.falquet@capgemini.com

Intelligent Industry Leader - APAC
vikas.g.kumar@capgemini.com

Visit us at www.capgemini.com/researchinstitute/

Capgemini Research Institute 2022

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

CAPGEMINI CANHELP ACCELERATEYOUR SUPPLY CHAIN
TRANSFORMATION

From traditional to Intelligent supply chain

Our service oﬀerings address the new business and technological challenges …

SUPPLY CHAIN CONTROLAND E2E
06 TOWERPERFORMANCE MANAGEMENT

Design, integrate and deploy cloud–based supply chain platforms, toprogressively provide end-to-end visibility, traceability and advanced event
monitoring capabilities while driving end-to-end performance

Network monitoring

Planning

Procurement

Execution

01

02

03

04

INTELLIGENT NETWORKDESIGN AND RISKMANAGEMENT

SMART FORECASTINGAND INTEGRATED
BUSINESS PLANNING

360° SOURCINGANALYSIS AND SUPPLIERCOLLABORATIONTOUCHLESS AND
AGILE ORDER
TO DELIVERY

Segment end-markets andchannels, diﬀerentiate
service oﬀerings anddesign intelligent supply
chain networks* all alongproduct life cycle, while
monitoring systemic risks
over time

Design, build and deploy
smart forecasting andintegrated business planningto better anticipate
customer demand while
optimizing service, stocklevels and enterprise
performance management

Design, build and deploy
supplier scorecards resilience, performanceand sustainability - andcollaborative platforms toconstantly improveoverall supplier eﬀectivenessArchitect, integrate anddeploy IS solutions andautomation, from smart
order management toagile warehousing andtransportation, to optimize
customer experiences andoperations

Network reconﬁguration

Planning

Procurement

Execution

CHAIN AS A
05 SUPPLYSERVICE

Provide externalized business services all along the supply chain while
progressively applying best practices and digitalization… across: resilience, customer experience, globalization and sustainability

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

Delivering such a vision requires a composable architecture …
PLAN
SOURCE

STORE

MAKE

SERVER

DELIVERYears

Network Design

Strategic

Sales & Distribution
Channels

APS (Advanced Planning System)

Month

S&OP and IBP
Purchase Planning

Operational

Supplier Collaboration

Weeks

Supplier

Tactical

Production planning

Demand Driven Planning

Forecasting

Distribution Res. Planning

Collaborative PlanningEnterprise
Performance
Management

E2E performance powered by Analytics
ERP
Procurement Management

Inventory

Production

Days

Delivery

Ordering

Control Tower

Execution
360° Sourcing visibility

MES*

Manufacturing execution

WMS(Warehouse Management
System)TMS(Transport
Management System)

OMS(Order Management
System)E-commerce

Process automation

Real time

External data providers

Third Party… combining transactional backbones, best of breed solutions, data and collaborative platforms* Out of Scope

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

MORE CAPGEMINI RESEARCH INSTITUTE PUBLICATIONS

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Conversations for Tomorrow #3:
Intelligent Industry: The Next Eraof Transformation

Next Destination: Software

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supply chain resilience for a
post-pandemic world

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Digital Mastery:
How organizations have progressedin their digital transformations overthe past two years
Capgemini Research Institute 2022

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How greater intelligence could supercharge supply chains. Augmented resilience, performance, and sustainability will allow organizations to take on a customer-centric focus.

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About Capgemini
Capgemini is a global leader in partnering with companies totransform and manage their business by harnessing the powerof technology. The Group is guided everyday by its purpose of
unleashing human energy through technology for an inclusive andsustainable future. It is a responsible and diverse organization ofover 340,000 team members in more than 50 countries. With its
strong 55-year heritage and deep industry expertise, Capgemini istrusted by its clients to address the entire breadth of their businessneeds, from strategy and design to operations, fueled by thefast evolving and innovative world of cloud, data, AI, connectivity,
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