Dynamic Scenario Planning Drives Resiliency: A 2024 Supply Chain Planning Trend

Recently, we’ve discussed the increasing frequency and impact of supply chain disruptions and the constraints of legacy supply chain planning systems. Obviously, there is inherent uncertainty and volatility in today’s business environment and because of this, the old ways of doing business simply won’t cut it anymore. For supply chain planning professionals specifically, there is a greater need than ever to be agile, mitigate risk and capitalize on opportunities to maximize efficiency.  

Traditional, static supply chain planning methods no longer ensure the resiliency and adaptability that today’s business environment requires. Enter Dynamic Scenario Planning, or the strategic approach of anticipating and preparing for potential scenarios that could impact supply chain operations.  

Unlike traditional, static planning, which mostly relies on fixed assumptions and pre-defined strategies, Dynamic Scenario Planning enables organizations to proactively identify and evaluate multiple potential future states. We recently sat down with several supply chain industry thought leaders to discuss Dynamic Scenario Planning in more detail – keep reading to learn more.  

READ MORE: Supply Chain Planning Predictions 2024: Trends and Insights from Industry Experts

A Proactive Plan for the Future

The adoption of Dynamic Scenario Planning is not only a response to the current state, but also a proactive strategy to manage uncertainty and build resiliency and adaptability for the future. Josue Munoz, Former Vice President Global Supply Chain at Colgate-Palmolive and Executive Advisor, shared “resiliency has become a critical factor for a supply chain to be successful, and as a result will be higher on the list of leaders’ priorities.”  

Simply put, Dynamic Scenario Planning provides the certainty today’s leaders require. Bruno Zindy, EMEA Presales Leader at ketteQ, underscored this when he shared, “if inputs change – and today’s disruptive-heavy landscape means lots of change – then existing equations won’t work anymore. That’s where scenario-based planning comes into play. We either will keep developing more complex models, or go scenario based.”  

The Intersection of Technology and the Human Element

But does the adoption of sophisticated technology mean the human element will be removed from the supply chain?  

Munoz argued that people are here to stay – and that technology will make them more effective at their jobs when he shared that organizations must “leverage technology as part of Dynamic Scenario Planning, but with a human being in charge of the process. There will always be a need for supply chain planners. Even though a solution can be prescriptive, you’ll always need a human to oversee key decisions. There is something to be said for intuition and experience combined with advanced planning systems.”  

AI’s Role in Dynamic Scenario Planning

AI and Machine Learning also play key roles in Dynamic Scenario Planning. AI algorithms, fueled by structured and unstructured data, empower organizations to anticipate potential disruptions and rapidly assess multiple scenarios. Machine Learning, with its ability to discern patterns and trends, facilitates the development of predictive models that dynamically adjust to changing variables in the business environment. By harnessing the power of AI and Machine Learning, supply chain planners can gain real-time insights, refine decision-making processes and proactively adapt strategies in the face of evolving conditions, ultimately increasing resiliency.

AI and Machine Learning are only as powerful as the data that fuels them, however.  

Rick McDonald, Chief Supply Chain Officer at The Clorox Company, shared that “data is one of an enterprise’s most valuable assets, but the vast majority of companies don’t treat it that way and end up with unusable data.” Ultimately, organizations that adopt Dynamic Scenario-based planning will have a competitive advantage – especially those that leverage their data well.

It's clear that Dynamic Scenario Planning is a pivotal driver of resilience, as it empowers organizations to embrace change and proactively prepare for uncertainty – a necessity for the modern supply chain. It will be a new breed of supply chain planning solutions that will enable Dynamic Scenario Planning – harnessing the power or innovation to propel organizations towards unprecedented levels of adaptability and success.  

To learn more about Dynamic Scenario Planning and explore all of the trends that will shape supply chain planning in 2024, check out our newest eBook.

‍