The Digital Supply Chain: Connectivity to Transform the Flow of Goods
Supply chain management (SCM) in classic industries has reached a level of complexity that can no longer be handled manually. It requires a digital supply chain that allows companies to flexibly adapt to shifting conditions and boost their resilience based on end-to-end transparency and synchronized processes.
Digitalization is Essential for Transparency in Global Supply Chains
In light of increasing complexity and disruption, supply chain managers are incurring significantly higher expenses to keep track of their supply chain and manage their network efficiently. They walk a tight rope where they need to keep sight of three success factors: deliverability, profitability and sustainability.
These dimensions will have a critical influence on supply chain management in the next few years. Reconciling them requires a form of intercompany cooperation that cannot be managed manually. This means that digitalizing the supply chain is absolutely essential. It creates a foundation upon which all other initiatives for supply chain resilience can build.
Efficient Supply Chains through Digital Transformation
Digital transformation in the supply chain generates a level of transparency that companies cannot go without. A clear example of this is in sustainability. Those wishing to meet requirements such as those under the German Supply Chain Due Diligence Act (LksG) need to not only prove their own carbon footprint but also provide information about the consumption of their suppliers and cargo contractors. This demands new, technology-supported interaction between customers, suppliers, and producers across the entire supply chain network.
Digitalization and supply chain technology, however, is more than just an increase in transparency. It unlocks numerous competitive advantages:
Better Business Management
Digital supply chains deliver a large volume of information, including near-real-time data and AI-based forecasts and analytics, which enables the early detection of and facilitates better decision-making.
Less Silo Mentality
A digital supply chain and its processes overcome “silo mentality” across the supply chain. A new level of integration arises, resulting in outcomes such as increased customer loyalty.
Proactive Risk Management
Thanks to the seamless information flows, supply chain management team members can detect and evaluate risks and disruptions in the supply chain network early on and implement appropriate countermeasures.
New technologies such as artificial intelligence, big data, automation, and simulations create new possibilities for operational management and collaboration, resulting in efficiency increases.
New Products and Services
Using data from the digital supply chain, companies can develop innovative digital products to gain hold of new markets and customers in an Industry 4.0 context.
How Is a Digital Supply Chain Created?
The range of solutions for digital supply chain management is extensive. In this crowded environment, it is important to keep track of available digital supply chain technology options and assess what is already reality and what remains a dream. The sensible next steps to be taken depend mainly on the status quo. This concerns the processes in production and logistics, as well as the synchronization and harmonization of the required volumes of data.
- How mature are the process and information flows?
- What capabilities do the existing systems have and what ones will be necessary in the future?
- What data do suppliers and customers need to supply/receive?
- How can data from upstream suppliers be accessed?
- Are there gaps that need to be filled as quickly as possible in order to meet customer requirements?
- How can transparency be created throughout the global supply chain, and what tools are available for analysis?
- Where is the potential that can be harnessed with artificial intelligence and process automation, and what conditions need to exist for that?
- What digital technologies add value the fastest?
Questions like these help with the creation of a road map which companies can use to improve cooperation within the supply chain step by step. Creating the right infrastructure and system conditions is not the biggest challenge here. SCM software is suitable for this purpose and enables full connectivity between suppliers, end customers, and partners via the cloud. Additionally, there are specific OEM solutions that connect suppliers and service providers through their production or factory management systems.
Human factors are more difficult in this context. Digital solutions only add value when information is shared all across the value chain and when all stakeholders profit from transparency. This requires partner-like relationships with suppliers and customers marked by trust and a culture of constant improvement.
We Help You with Digital Supply Chain Management
Ingenics Consulting has supported manufacturing companies, trade service providers, and logistics and transport contractors with the digitalization and optimization of their supply chains for years. Firstly, our consultants possess industry knowledge, technical expertise (including in procurement, logistics, production, and supply chain management), and competence in change management. Secondly, companies benefit from our understanding of planning and implementing digitalization projects. This means we can act as a “bridge builder” that strengthens the interaction between all stakeholders in the supply chain.
We give you concrete support in the planning and implementation of a digitalization strategy for your supply chain with the following services:
- Analysis and Evaluation of Strengths, Weaknesses, and Potential Optimization
- Development of Strategies to Fit the Industry and Organization
- Selection of Supply Chain Technologies and Solutions Based on Company-Specific Requirements
- Supervision of Implementation and IT Project Management
- Change Management for Cementing Changes in the Long Term
- Performance Monitoring and Analytics Based on KPIs
- Implementation of Risk Management in Connection with Supply Chain Digitalization