The Future of a Digitized Supply Chain is Here

In today’s age, it is crucial that your supply chain supports you. While traditional supply chain methods could have worked well in the past, their manual methods have been proven to fall short when dealing with today’s complexities. However, traditional supply chain methods are still widely used today. 

Traditional supply chains include a heavy reliance on manual processes, paper-based documentation, and isolated or legacy systems. They are very systematic, moving in a linear and structured way. This could mean that if one section of your supply chain is delayed, the entire supply chain feels its effects. These systems don’t provide the tools needed to move at the speed companies need to move at today, meet high consumer demands, or deal with the continually changing regulatory landscape.

The good news is, digital supply chains are here.

What is Supply Chain Digitization 

In contrast to traditional supply chains, a digital supply chain operates in real-time, is dynamic, and can adjust to changing conditions. Digital supply chains integrate data from multiple systems, maximizing efficiency, providing a range of services, and can operate in a proactive state rather than reactive, allowing businesses to foresee problems and react without much planning.

Digital supply chains allow for better insights into each stakeholder’s work within the supply chain. Thus, supply chain management runs smoothly and efficiently, reducing the amount of misinformation. With a digitized approach, each stakeholder has full visibility into each step of the supply chain and is notified of any changes that need to be made in order to get the final product to market. 

Key Technologies Driving Supply Chain Digitization

The key to a digitized supply chain is a reliance on new technologies. Unlike traditional supply chain methods, this is not a manual system. Some technologies that drive supply chain digitization include:

• AI & Machine Learning: Uses data to optimize routes, predict demand, manage inventory, and streamline overall efficiency.
• Automation: Helps move faster with consistent quality by reducing manual error, increasing production and delivery speed, and staying agile. 
• Cloud Computing and Big Data: Provides access to large amounts of data from all your supply chain partners, keeping everyone in the loop.
• Specification Data Management Systems: Have real-time, up to date specifications at the tip of your fingers, upload documents, collaborate across teams, suppliers, and vendors, and create reports.

Benefits of Digital Supply Chain Transformation

There are many value drivers of a digitized supply chain system. Some of the greatest benefits to a digital supply chain include:

• Enhanced efficiency and productivity - By digitizing your supply chain, many operations become more efficient. Automated workflows speed up the process of getting products to market. Additionally, access to the correct data at any given time boosts productivity and streamlines workflows, rather than having to wait on information or sift through spreadsheets.
  
• Improved accuracy and transparency - With a digitized supply chain constantly communicating, workflows become much smoother. Rather than catching a problem once it’s too late and then having to start over, new technologies can catch these issues and take care of them before they get out of hand, or worse get distributed to the public.
  
• Better risk management and supply chain resilience - Real-time monitoring and communication helps mitigate any risks or disruptions. If an item is recalled, a digitized supply chain can adapt quickly so that there are no more potential disruptions. If an error is made somewhere down the supply chain, other key stakeholders can react accordingly.
  
• Environmental sustainability - Digitized supply chains can be optimized without putting other stakeholders at risk. Data can easily be pulled for compliance reports, more sustainable distribution routes can be identified, every stakeholder can be aware of material changes made that affect them, and more. The possibilities of having an entirely integrated supply chain are endless when it comes to sustainability.   

Challenges in Supply Chain Digitization

While digital supply chains are where the industry is evolving towards, with any new technologies come new challenges as well. One such challenge is around cost and implementation resources. Any drastic change will be costly in some way, whether that’s in monetary resources, time allocation, or both. There is also always a learning curve that could result in an efficiency dip until all the loose ends are sorted out. 

Additionally, change is difficult for most people. Many companies, even if they would enjoy the capabilities of a digital supply chain, end up sticking to traditional models that may be simply okay only because the thought of changing their processes seems worse than the negative consequences traditional supply chains bring. The initial lift of implementing new technologies can be overwhelming for companies.

The Future of Digitized Supply Chains

While the initial implementation of a digitized supply chain can come with a learning curve, the future of digitized supply chains is promising and well worth the effort. Once your company has the basis of their digitized supply chain, it can build upon its foundation and utilize advanced technologies to address new challenges.

Technologies like Artificial Intelligence (AI) and low touch planning - utilizing AI and analytics to plan out projects - will become more and more prevalent and can be taken advantage of with a digital supply chain. Sustainability efforts will also continue to rise, requiring more advanced reporting methods, communication between stakeholders, and proactive thinking.

However, these new technologies and big picture thinking initiatives can only be utilized and realized with a strong data foundation. The need for data management systems becomes even more critical, as none of these new technologies can function without accurate information being fed into it. Teams also need to stay flexible and adaptive. With uncharted territory comes unexpected challenges that require teams to be agile when addressing them.

Conclusion

Traditional supply chain management is simply not going to set your organization up for success in the long run. To be frank, these systems probably aren't even serving your company today.

Though transitioning from a traditional approach to a digital approach can be overwhelming, taking a phased approach makes it more manageable. It is crucial to start getting your data in order and in a digitized, centralized system so that your company can eventually begin this transition.

Specright can help you take the first step towards a digitized supply chain. Don’t wait until it’s too late. Contact us to learn more and embark on this journey today.