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MODERN SUPPLY CHAINS the vision of consulting companies Bondareva E.

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“Supply Chain and Risk Management” PricewaterhouseCoopers Four levels of supply chain maturity

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Level 1: Reactive supply chain management Low degree of integration and little coordination between suppliers and partners Minimal coordination between product design and supplier operations Little visibility into source of supply chain risk Unbalanced inventory leading to poor customer service

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Level 2: Internal supply chain integration with planned buffers Align performance objectives and information across internal departments Some visibility into emerging changes and patterns outside of the company Changing demand patterns influence product design Integration of internal risk management processes

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Level 3: Collaboration across extended supply chain network Extensive data and information sharing produces high visibility Integration of product design and inventory management across all supply chain partners Visibility outside of the organization is exploited to predict change and variability Monitor supply chain resilience levels and business continuity plan preparation

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Level 4: Dynamic supply chain adaptation and flexibility Align KPIs across the entire ecosystem Full flexibility to identify and respond to emerging value chain patterns Real-time monitoring and data analytics Quick responses shortens product, network, and process lead times Segmented risk strategies based on supplier profiles and market-product combination characteristics

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“Building the supply chain of the future” Many global supply chains are not equipped to cope with the world we are entering. Jim Owens, the former chairman and CEO of construction-equipment maker Caterpillar: “the competitor that’s best at managing the supply chain is probably going be the most successful competitor over time. It’s a condition of success”

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Challenges and sollutions More uncertain world

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The smarter supply chain of the future Smarter cost containment Smarter visibility Smarter risk management Smarter customer interaction Smarter global integration