Digital Supply Chain: Connecting The Dots Of Design To Operate SCM Processes

Ronald van Loon

Part 3 of the series “Winning In The Experience Economy

Today’s supply chain is governed by the manufacturers, wholesalers, retailers, and businesses operating in between. Not only has the concept of a supply chain progressed by leaps and bounds during the last decade, but it is also one of the most critical functions for an organization looking to achieve its short-term and long-term business goals.

The supply chain, if perfected, is a critical weapon in this competitive environment. The incorporation of the digital transformation in supply chain processes will eventually lead to new business models that directly influence the performance of the brands involved. This will eventually help you turn your supply chain into one that is opportunity-centric rather than cost-centered.

The availability of analytics and relevant data also influences the need for more digitization in the supply chain. All these digital metrics can be used within the supply chain management (SCM) processes for optimization and to ensure that all facets of the SCM process are covered.

Why do you need a digital supply chain right now?

Before discussing the importance of optimization in the supply chain, let’s look at current trends.

Visibility and connectedness

Supply chain visibility refers to being connected and having a tangible network with the other partners. It has been around for quite a while and is nothing new for managers.

But how many of your supply chain partners are you digitally connected to? Supply chain processes are often distributed into unperceivable silos. Digital connection or visibility, which is a must-have and perhaps the most important part of the supply chain process, has been missing from the picture for some time now.

Besides supplying materials, how many manufacturers would agree to be connected to the carriers responsible for logistics? Even if we expand the definition of supply chain to include logistics, we lack the connection that should be a must.

Better customer experience

The end goal of all supply chain processes is to deliver better customer experiences. The delivery process should be optimized and corrected to avoid any errors or problems that come with receiving a product.

If your supply chain isn’t digital, you’re not just falling short of your competitors; you’re falling behind the trend in the market as well. They have changed, and the focus now isn’t just on making the cut. The focus for organizations and manufacturers is to perfect the customer experience and ensure that customers get exactly what they want. This can only be perfected with seamless incorporation of the digital supply chain into everyday business affairs.

If you don’t embrace the trend of digitization in the supply chain and give your customers just what they are looking for, they will look elsewhere and switch to other manufacturers.

Sustainability

Sustainability, in both business and the environment, is a trending issue in the supply chain. The realities of climate change make environmental sustainability a must for supply chain processes. These processes should only be performed when you have perfect connectivity and visibility. With these metrics, you can be aware of everything happening in your supply chain processes.

Customer-centricity

The single biggest notion driving organizations towards change in the supply chain is customer-centricity. Organizations vying for change in the digital supply chain must incorporate numerous changes, but it is the opportunity presented by customer-centricity that is pulling them towards supply chain glory.

In this age of customer-centricity, personalization is the key to standing out. Managers agree that a customer-centric approach is critical and they need to alter their offerings to fit this perspective, but they don’t realize that the personalization needed for a customer-centric approach requires exceptional quality in the supply chain. The current supply chain is extremely poorly equipped to handle the challenges that come with a customer-centric approach.

In a bid to give customers the experience they require and truly embrace the concept of Industry 4.0, organizations are looking to incorporate the digital supply chain within their setup.

Supply chain challenges

Challenges within supply chain that organizations and customers face are:

  • Continuous deliveries: Customers now have multiple subscriptions for products, which means they require continuous delivery. This is hard for organizations to manage, but customers want the promises made to them to be met.
  • Managing personalization: As items become personalized, every customer has a new demand. Meeting these demands requires exceptional personalization, which isn’t possible through current supply chain methods.
  • Innovation push: The supply chain should push towards innovation, rather than stopping it.

To solve these challenges, companies require a digital supply chain that can help them withstand the test of time and give the best to their customers.

How digital supply chain can help with new challenges

A goal of the digital supply chain is to connect everything around organizations and perfect the user experience as much as possible.

The digital supply chain is an integrated entity that covers multiple analytical and business processes. The supply chain covers all stages from product design to post-purchase customer service. The goal for organizations is to make the ultimate move towards a closed loop: a collaborative and planned supply chain.

Why now?

All facets of the supply chain must be connected optimally to solve these complications correctly. Whatever your business model, it is imperative that you support the digital supply chain and help improve connectedness, visibility, and sustainability throughout your setup.

The ability to incorporate the digital supply chain within your organization could eventually help you:

  • Drive down the costs associated with traditional supply chain methods. Organizations want customer-centricity, but it is expensive to manage it with existing processes. The digital supply chain will help drive down costs to more manageable levels.
  • Increase efficiency for all parties. From the manufacturer to the customer, all parties will experience enhanced operational efficiency.
  • Increase connectivity within processes to meet customer expectations and deliver better customer experiences.

You can get started today by ensuring that your whole IT system is working together. Collaborative efforts should be implemented to truly achieve a digital supply chain within your organization.

Explore the challenges, opportunities, and technologies involved in achieving critical business outcomes in the experience economy. Read more about the neighborhoods of the digital core, network and spend management, digital supply chain, customer experience, and people engagement.


Ronald van Loon

About Ronald van Loon

Ronald van Loon helps data-driven companies generate business value. He is recognized as one of the top 10 Global Big Data, IoT, Data Science, Predictive Analytics, and Business Intelligence Influencers by Onalytica, Data Science Central, Klout, and Dataconomy. He is an author for leading Big Data sites like the Digitalist Magazine, Datafloq, Data Science Central, and The Economist. He is a public speaker at leading Big Data, Data Science, and IoT events.