How it all started

Hi there!

In this post, I’d like to go through the history of control towers and supply chains. Now, I know that history is probably not the most exciting subject you’ll ever have, however, I believe that it is important to look where we came from, so we can prevent making mistakes again, which we made in the past.

To start with, I’d like to go back to the years almost directly after the second world war, the end of the 1950’s and the 1960’s. During this period of time, people, again, had money to spent. This automatically meant that consumption of goods drastically increased. However, companies did not have this pressure before. This new development caused companies to change and ensure a highly efficient production plant. Therefore, companies started to optimize their individual production lines, so every single one of them ran as efficiently as possible.

Despite these efforts, it appeared that it was not yet enough. As time passed, the increase in consumption kept on rising. This increase in demand put a lot more strain on the supply chains and the companies within them. At this time, companies started to see the production plant as a whole and tried to optimize the overall performance of their company. During this period, methods and theories like the Theory of Constraints were coined. Also, during this time, the materials management was brought to light. With materials management, companies tried to further optimize their performance by monitoring the goods flow within their company, starting at purchase up until distribution of the final product.

During the 80’s, we can see that companies are still on their path for an ever more optimized way of working. Companies which are making several products are trying to use the same means and resources for making different products. With this development, the concept of logistics was created, meaning that overseeing the total process of the company, and improving this, became more important.

During the last decade of the 1900’s, the first (real basic) control towers saw the light. In a quest for further decreasing costs and prices, companies started to see the benefits of collaboration. The first sharing of information was a fact and companies started to see the use of sharing resources. The goal of this was to build a stronger supply chain, with which every individual company obtained benefits.

To end off with, the present. At the moment, companies are really starting to adopt and use control towers to build a strong supply chain. Also, the terms of resilience and agility are highly connected to this. Especially since the monetary crisis in 2008, companies do not want to be the subject of a bankruptcy when such crisis hits again. Therefore, the sharing of information throughout the supply chains, and sometimes even between supply chains, fulfills this need. In my last post, I used the following definition of control towers:

A control tower is the central point in the supply chain which has the technology, people and processes enabling them to oversee and control the flow of products, information and money to and from each shackle within the supply chain.

I believe this definition perfectly suits the current state of which the supply chains are in and resembles the current need for collaboration in the supply chain. Hopefully, now you realize where control towers have come from and why they are becoming more important. Hope to see you in the next post!

See Y’all!