Author: Deborah Dull
Imagine: All waste and process by-products in the world will become the raw materials and inputs needed by all the processes in the world. In turn, the maintenance, refurbishment and remanufacturing industries will dramatically increase in size and value. Then, aftermarket supply chains will become the dominant model as linear supply chains give way to circular supply chains.
In the circular economy, materials and resources loop throughout processes indefinitely. Supply and demand loops among value networks allow for types of monetization previously impossible. On a global scale, this circular economy is expected to add $4.5 trillion to the global economy by 2030.
Supply chains around the world will be challenged to shift their habits to support new business models. The increased complexity that will be managed by global supply chains will be represented by future Supply Chain Operations Reference (SCOR) model versions.
Skills in a circular economy
Workforce skills, experiences and training become critical for the transition to a circular economy. Supply chain roles make up 40% of the jobs in the United States, and these roles will shift over time, prompting an update of skills, experiences and training.
Skill shifts in a circular supply chain
Several skill areas will shift and expand in the SCOR model. Asset management will become a broader topic. For example, as items remain in use longer, more types of items will be considered assets.
Inventory management — already a vast skills topic — will become even larger. The definitions and types of inventory will expand as materials circulate and are managed as both raw materials and assets.
Skills regarding performance become even more critical to link performance to the overall supply chain strategy and develop meaningful key performance indicators that properly balance cost, quality, time and the circularity of a supply chain or network.
New skills also will be added to the SCOR model. These may include skills such as
- digital literacy and industry 4.0 awareness
- digital value stream mapping and the idea of digital lean management
- circular economy awareness.
Shifts to the SCOR Model
The SCOR model has reflected supply chain processes, performance metrics, practices and skills for more than 20 years. It will continue to shift to reflect the supply chain habits required to support industry 4.0 and a circular economy, and supply chains will continue to strategically position organizations to succeed.
Join the circular supply chain community
Deborah Dull is a co-host of the Supply Chain Revolution™ Podcast and ASCM’s global influencer for circular supply chains. She provides thought leadership regarding using circular strategies to achieve supply chain goals, focusing on building relevant digital industrial supply chain products that pave the way to a circular economy. Deborah also leads product management for the supply chain and operations management portfolio at GE Digital, including the supply chain and manufacturing capabilities needed to accelerate the industrial transition to a circular economy.
About the Author