Murmuration: What Starlings And Supply Chains Have In Common (Part 1)

Falko Feldchen

Part 1 in the “Murmuration and Digital Supply Chain Collaboration” series

Murmuration is a phenomenon that results when hundreds, sometimes thousands of starlings fly in swooping, intricately coordinated patterns through the sky.

Why do they do it?

There are multiple reasons why starlings would group into a murmuration. It’s a way:

  • To share information, e.g. about new food sources, across the flock.
  • To defend against a predator attack. The starlings either form a group, which may appear like a bird too large to attack, or they surround the predator in order to confuse it so it cannot grab a single bird.
  • To economically increase the temperature for the group in cold autumn evening hours.

Going back to supply chain

A key supply chain management theme these days is control of n-tier supply networks, where one organization tries to control multiple stages of a supply chain.

If we look, for example, into the telecom network equipment industry, the OEM wants to look into the four tiers of a supply chain:

  1. Contract manufacturer
  2. Component supplier
  3. Chip manufacturer
  4. Wafer supplier

The business involves frequent integrated circuit product changes and significant demand uncertainty. In a traditional weekly planning scenario, it takes a minimum of eight weeks for OEMs to know whether the four tiers of suppliers can handle the change. Worst case, this may result in the wrong item being made for at least eight weeks, as well as other bullwhip effects.

Figure 1: Supply chains still process and share information poorly today

The answer today is often central orchestration and tighter control of trading partners by the OEM across the entire four-tier supply chain. This requires high investments into visibility technology, but also a need for firefighting, process control, and legal negotiation efforts, as well as buffers on all levels of the network.

But not only does this strategy involve high effort, it also leads to unrealistic expectations, because capacity at the fourth-tier supplier is not necessarily related to the customers’ customer. In addition, the further down the supply chain, the less trust there is between the OEM and the supplier. Finally, overlapping interests by other trading partners, who want to lead and orchestrate the network, will increase complexity. Therefore, the concept has significant limitations.

Figure 2: Multi-tier supply chain control and orchestration

What can those 200 million starlings teach us?

The concept of murmuration does not consciously know about multi-tier control or a single orchestrator, but it relies on a handful of simple rules and all individuals contributing in the same way to the benefit of the larger group. As a matter of fact, the starlings balance effort by communicating with the seven birds closest to them, carrying the message across the entire group. It’s a very efficient way to ensure the entire group is clear about food places or potential dangers and can react extremely quickly as a whole.

Wouldn’t it be great to stay tuned with the end customer’s behavior, even when we are far away from the market, or to share the burden of disruption by acting as a single entity (supply chain) in a very agile fashion, saving time and working capital?

In Part 2, we’ll explore how starlings murmurate and how this can be translated into supply chain actions.

Want to find out how SAP Ariba can support supply chain collaboration? Visit our Web site to learn about our solutions.

Read the entire “Murmuration and Digital Supply Chain Collaboration” series.

About Falko Feldchen

Falko Feldchen is a supply chain management evangelist at SAP. He uses his 20 years of industry experience gain through various consulting, service, and sales roles worldwide. Falko joined SAP two years ago to help companies bring their business collaborative planning, procurement, and execution strategies to the next level.