Speeding Up the Supply Chain with Interoperable Systems

Ongoing supply chain disruptions have highlighted the need for more data sharing among supply chain partners. Implementing interoperability—connecting companies’
computerized and automated systems to expedite information exchange—is one way to accomplish it.

Improving data sharing through interoperability can provide many benefits. “Increasing transparency across a value chain through data sharing and collaboration is a powerful way to keep supply chains operating efficiently,” said Tarek Kasah, associate partner, McKinsey & Company. Visibility across all tiers of a supplier network minimizes the risk of supply chain disruptions, improves productivity and gives a holistic perspective on environmental impacts.

There’s been some progress toward interoperability in recent years. The diverse technologies companies use for their own operations are no longer an insurmountable barrier. “Modern cloud technology and the Industrial Internet of Things offer solutions to the technological challenges of data sharing and interoperability across the supply chain,” Kasah said.

But data-sharing standards are still being developed, and many organizations have reservations about moving forward. “The greater challenge is trust between
players, which requires a common understanding on what data can be shared and agreement on how it will…

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