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Darwinian Manufacturing: Winning in a Survival of the Fittest Moment

July 19, 2023
Keith Hartley

In the 1860s, Charles Darwin popularized the term, “survival of the fittest.” His now famous passage stated it is not the strongest or the most intelligent creature that survives but the one most adaptable to change. In other words, those who survive can adapt to the immediate environment. Regarding direct materials sourcing, this concept has never rung truer.

Think about the manufacturing business right now. In a post-COVID-19 world, high inflation, geopolitical tensions, and still-long lead times for some commodities means business as usual is over—especially when trying to maintain and grow margins. Just-in-time is being replaced by just-in-case, and those with access to intelligence platforms with actionable insights from contextualized data will become more “fit” to survive in the new reality of constant change. Those who continue managing in silos with spreadsheets simply won’t be able to compete.

Modern direct materials sourcing intelligence platforms can proactively alert teams of changing market or supplier conditions so the team can adjust before it impacts production or customers. Spend intelligence features transform deep, actionable insights into savings opportunities without adding headcount. You can even tap into billions of datapoints to discover the best price for materials, ingredients, and parts.

Think of AI-powered direct materials sourcing platforms as tools of the trade. You already rely on other systems such as ERP, MES, indirect procurement, and supply chain systems of record. Why not provide your direct procurement teams with superpowers, career progressions, and opportunities to contribute to top- and bottom-line growth, too?  

If your direct material procurement teams can go to a single platform and quickly retrieve actionable insights that help immediately save millions of dollars, why wouldn’t you use it? Powered by AI and hundreds of relevant data sources, these platforms aggregate and contextualize everything about your direct sourcing operation. When you look at the savings compared to the investment, it’s a no-brainer. Yet many manufacturing organizations are staying the course, relying instead on 50-year-old technology: spreadsheets and emails.

This is setting up a “winners” and “losers” scenario. Winners invest to adapt to the changing environment, and losers quickly fall behind until they go the way of the dodo (going back to Darwin again). 

If your manufacturing organization isn’t currently taking proactive steps to utilize data to ensure better, more informed purchasing of parts, ingredients, and metals, then you risk becoming an artifact of the past—and ultimately weeded out, as Darwin predicted. Which one are you?

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