ACHIEVING MAXIMUM PERFORMANCE: SUPPLY CHAIN & DIGITIZATION
Digitization, in definition is the utilization of digital technologies to enhance or reinvent business model towards better agility and efficiency, building new processes and providing new revenues.
In a world that is constantly moving towards digitization, new digital trends are opening windows towards new opportunities for businesses to evolve. However according to a research conducted by DHL, over 95% of supply chain companies have failed to realize the potential significance of digitization technologies towards supply chain optimization. There is a rising concern that these companies will be falling behind its competitors that dare to take up the challenges of moving towards digitization.
THE CHALLENGES
No clear strategy
Realizing the potentials of supply chain digitization is not enough, there must be a plan of implementation in order for the transition to succeed. A strategy for digitization must not only focus on the impact towards business and revenues but towards stages of implementation as a whole. Importantly, the strategy must take into account the period of transitioning in which the business might face some instability and challenges.
Missing digital talents
A digital revolution requires digital minds behind the wheel. Getting the right talents with the right skills are the first dire step. The challenge lies where attracting and maintaining the Gen Y talents with the most digital exposures hasn’t been the easiest move to maneuver. Aside from attracting new talents, companies are not investing enough in developing and grooming existing talents to keep up with the trends.
Fear of Digital disruptions
With rapid advancements of digital technologies, supply chain leaders must constantly be on the top of things. As digital technologies will continue to disrupt and transform business processes and models to be better. It might be daunting to think of having to change and reform the processes of what we have already known traditionally however opportunities does not come without a cost. As best stated by Hans Thalbauer, senior VP of Extended Supply Chain at SAP, “To win in the digital economy, we have to reimagine how we design, plan, make, deliver, and operate our assets,”. Leaders must remove the mind set that changes are negatively disruptive. The traditional ways may work, but the new ways may work better.
THE BENEFITS
Establishing transparency of logistics
Digitization, once applied, will reduce and eventually eliminate all manual processes, filing, spreadsheets and all documents alike. Through enterprise digital systems, a central cloud-based command system that has the ability to effortlessly connect suppliers, manufacturers, logistics warehouses and customers, providing real-time updates and statuses. Transparency will allow higher satisfaction for both the customers and the clients and plan for cost-saving as well as improvements.
Internet of Things (IoT)
Internet of Things or (IoT) in simplest explanation is the connecting of devices via internet that allow these devices “talk” to each other, gathering and analysing data to create an action plan. IoT has the capability to transform operational efficiencies and revenue opportunities on a large scale. One of such example is fleet maintenance, IoT enables easy maintenance scheduling and keep track of large volume of fleets, ensuring that there are sufficient fleet available per day. It also has the ability to track any roadside breakdowns and getting immediate help from the nearest repaired shops. Ensuring that every fleet, truck and ship is being well-maintained and running optimally is important in logistics and supply chain.
Blockchain utilization
Blockchain is no doubt the topic that has been discussed widely. Its potential hasn’t passed the Supply Chain Management industry. Blockchain is simply a digital ledger that keeps a secured and permanent records of all successful transactions. Its application in supply chain industry includes seamless transfer of funds from anywhere in the world thus eliminating involvement of any third parties, providing permanent and accurate records of all transactions allows pulling these data very efficiently and removing the hassle of having to find proofs of payment as these will be on your fingertips.
Digitization will undoubtedly be the future of Logistics and Supply Chain Management. Supply chain management companies must now look forward to adapt these changes in response to technological advances that will sure give a competitive edge over their competitors.
References:
https://www.logisticsforthelifesciences.com/knowledge-power-supply-chain-digitalization
https://www.logisticsforthelifesciences.com/supply-chains-struggle-utilize-digitalization-technologies
https://medium.com/@KodiakRating/digitization-of-the-supply-chain-the-future9-is-now-767fc2db800e
