June 25, 2021 - 5 minutes read
Creating a Practical & Sustainable Strategy For Supply Chain Transformation
Supply chain change and transformation are inevitable given the exponentially growing complexity of today’s global supply chains. With this constant barrage of new information, requirements, and technology, however, often companies are hesitant to implement any changes to their supply chains due to the “we can’t stop in the middle of a sales cycle” critical nature of supply chain processes and applications. These real, and growing, concerns often hinder a business transformation and keep organizations from unlocking their full supply chain potential. Digitization in the supply chain sorely lags technology adoption in other segments of the enterprise, according to McKinsey, the average level of digitization in supply chains is only 43%, which lags far behind automation adoption and use in operations, accounting, sales, etc. within most organizations.
While fear of change is real, in the supply chain domain the fear to adopt or upgrade, supply chain software is palpable. There is not only the fear of making a wrong decision but in trying to understand and comprehend all the innovations in the supply chain industry and latest buzzwords as you’re making your evaluation. The logistics and supply chain industry involve massive and complex ecosystems that in no way can be transformed overnight. So, the question becomes, how do you evaluate, select, and implement new automation tools without delaying customer orders?
To reach your end state of a practical and sustainable supply chain software solution, the key to any successful global supply chain evolution is in steady and gradual steps guided by a clear and consistent supply chain strategy. It is important to keep in mind that an organization must be open to making operational changes to support these technology upgrades, it becomes very challenging for a business to fully leverage technology without a clean process.
Digital Transformation: How It Changes Supply Chains
Supply chain technologies have been evolving in many directions, focusing on gathering and collecting data, automating operations, and improving decision-making. Ultimately, any innovation that a company will implement into its digitalization strategy will need to bring better operational efficiency, service quality, data insights, and lower costs.
When talking about supply chain digital evolution, it is important to note that it went from adopting many different tools and technologies for upgrading separate parts or functions of a supply chain, to seeking a centralized approach that uses innovations to optimize as many processes as possible, enabling superior decision-making. This requires cross-functional data exchange, as many valuable insights can be extracted only when there are multiple layers of data from different sources and types.
Supply chains are also getting more complex than ever. With more connected devices and spaces, volumes of various types of data are being accumulated, which creates an additional need to process and analyze it in a comprehensive and integrated way.
Step-by-Step Roadmap: Transforming Your Supply Chain Without Disrupting It
Supply chain transformation is necessary, but it can only be successful when it’s gradual and well-thought-out. A clear and detailed roadmap is a necessity for injecting steady and continuous improvement into your supply chain.
Recognize, and Take Advantage of, the Gradual Nature of Supply Chain Transformation
Another key to success for supply chain organizations is that the digital strategy matches their organizational strategy and vision. The technological component must be in line with company operations, so the first step to transforming a supply chain without disrupting it requires the creation of an outline that clearly identifies your supply chain vision and anticipated changes and process improvement. Depending on your industry and the nature of your global supply chain, these can be diverse goals, so it is critical to align them with current business needs and collaborate with other groups within your organization to develop a holistic solution for your entire company
Carefully Assess Your Supply Chain
It is vital to critically assess supply chain capabilities before deciding on specific process changes and new technology. Taking a look at the software that’s already in place and detecting areas where digitalization is most needed will be beneficial to forming an upgrade plan. It’s then crucial to document current ‘as is’ supply chain processes and identify gaps between current capabilities and your future ‘should be’ supply chain state.
Finally the most important factor: data. Where does it come from, how is it processed, how transparent is it, and are all the data sources integrated? In today’s technology-driven world, data is a critical component, and an area that can not be overlooked. Follow a strategy
To be relevant and competitive, companies need to develop and follow a roadmap to successfully transform their supply chains into a practical and sustainable competitive advantage in today’s global marketplace.
Wrapping Up
Today’s rapidly evolving global supply chain can not afford any disruption to customer order deliveries, just because new technology is being introduced. Supply chain practitioners, when choosing a software solution, a tech tool, or data infrastructure, will find that a gradual approach will bring scale and long-term results. The implementation process should be conducted in a step-by-step manner, slowly bringing transformation to separate areas of the supply chain. Skilled supply chain solution providers like Agistix help businesses evolve without disruption and stress. Our robust data infrastructure supports the requirements of today’s quickly evolving data interfaces and formats, enabling a non-disruptive and efficient change for our clients. Learn more about Agistix solutions here.
