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supply chain manager

Stepping Towards a Digital Supply Chain

Technology is changing the way we look at logistics and, ultimately, the supply chain as a whole. With today’s global marketplace being what it is, companies need to be both agile and smart about the moves they make. “Making do” simply isn’t good enough. Supply chains, by necessity, need to be leaner, meaner, transparent, and most importantly, smarter.

The digital supply chain offers companies a degree of visibility and insight into their supply chain that was never before possible.

For that reason, many companies are beginning the process of digitizing their supply chain. Moving away from the analog game of tag that was the way of doing things in the past, the digital supply chain offers companies a degree of visibility and insight into their supply chain that was never before possible. In order to do it correctly, companies need to have a plan. “The impact of digital trends on the supply chain has caused plenty of excitement, but also confusion. In a 2017 Gartner survey of 318 supply chain organizations worldwide, 75% reported concerns about the governance of digital projects. Yet corporate digital business initiatives continue to evolve rapidly, and 36% of supply chain organizations say their own digital projects don’t align to them,” says Gartner contributor Rob van der Muelen.

Supply chain leaders should already have a plan for supply chain digital initiatives and how to align them to what’s going on in the wider organization and its ecosystem.

“Supply chain leaders should already have a plan for supply chain digital initiatives and how to align them to what’s going on in the wider organization and its ecosystem,” says Michael Burkett, vice president and distinguished analyst at Gartner. “Yet the reality is that organizations pursue digital projects in silos far too often.” Burkett encourages companies to be proactive and to “define the emerging technologies that will best optimize and transform your supply chain.” “Feed this expertise from the front line into the organization’s wider digital business strategy, and then do your part to make it a reality,” Burkett says.

Understanding the Digital Vision 

Wanting to digitize the supply chain is all well and good, but knowing what you want to accomplish with it is the important part.

Burkett says that the starting point for creating a solid plan for going digital begins with breaking out of the data silos and agreeing to a digital business vision across the entire organization. This agreement is what sets the gears in motion, where the needs of both the company and its customers are defined, and what changes will need to be made to the supply chain to make it happen. Wanting to digitize the supply chain is all well and good, but knowing what you want to accomplish with it is the important part. “Look for supply chain technologies that have the potential to open new revenue streams rather than simply efficiencies, and get buy-in and participation across the business,” says Burkett. 

Align the Supply Chain to Match the Vision 

According to Gartner, only 25 percent of supply chain organizations have their digital projects aligned under a single governance process. “A lack of alignment clearly makes it less likely a supply chain will successfully support key organizational priorities,” Burkett explains.This ultimately shapes what you can deliver to your customers and what changes will need to be made to the supply chain to make that happen. “For example, a product manufacturer’s business priority might be to ensure that a customer’s equipment never stops working. Digital advances now give it the ability to digitally monitor assets and offer solutions in near real time. This capability effectively creates or improves a service-based revenue stream for the manufacturer.” In order to make that a reality, the company must be able to predict a malfunction or failure and have a process in place to preemptive send both parts and a service technician to maintain the equipment to reduce downtime. In the past, this would have been all but impossible. However, digitization has created a useful toolkit that can make that a reality.

  • Internet of Things (IoT) to measure performance in real time 
  • Data Analytics to predict failure and automate delivery and service processes 
  • Mobile Data Access Capabilities 
  • Application program interfaces (APIs) to share data with the partner ecosystem 

Prioritizing Technology Investments  

Digital supply chains, when done correctly, do more than simply streamline operations, they become a differentiator from the competition, setting your company apart from all the others.

Investment in new technology can be hard to swallow, especially considering the uncertainty of the global market. As a result, many supply chain organizations tend to focus their investments on upkeep rather than upgrades. While that strategy might have a short-term effect of bolstering profits, it will ultimately prove to be short-sighted as customer’s expectations shift to a digitally based supply chain. Digital supply chains, when done correctly, do more than simply streamline operations, they become a differentiator from the competition, setting your company apart from all the others.“This is a supply chain that delivers a customer experience and not just a product,” says Burkett. “It’s an intelligent supply chain that makes decisions as it interacts across an ecosystem of digitally connected partners.” 

Simplify Your Supply Chain

BlueGrace Logistics offers complete, customized transportation management solutions that provide clients with the bandwidth to create transparency, operate efficiently, and drive direct cost reductions. For more information on how we can help simplify your supply chain, contact us at 800.MYSHIPPING or fill out the form below to speak to one of our freight experts today!  

The Supply Chain Manager of The Digital Age

 

The supply chain has long been held as the lifeline for any company’s operations. It is the flow of goods and materials necessary for the company to continue to function and operate at peak efficiency. Because of that, supply chain managers understandably need the most accurate information in real-time about what’s happening within the chain. Armed with up to date data, a manager can make decisions about how to proceed in the event of problems, delays, and overall operations.  

Legacy systems that have sustained the supply chain for the past several decades are no longer valid.

However, in the face of new and disruptive technologies, the legacy systems that have sustained the supply chain for the past several decades are no longer valid. They lack the ability to provide the necessary end-to-end visibility required for high speed, lean operations. But it’s not just the tech that’s getting outmoded. Soon the position of supply chain manager might be a thing of the past as well.

“New digital technologies that have the potential to take over supply chain management entirely are disrupting traditional ways of working. Within 5-10 years, the supply chain function may be obsolete, replaced by a smoothly running, self-regulating utility that optimally manages end-to-end workflows and requires very little human intervention,” according to the Harvard Business Review.

“With a digital foundation in place, companies can capture, analyze, integrate, easily access, and interpret high quality, real-time data — data that fuels process automation, predictive analytics, artificial intelligence, and robotics, the technologies that will soon take over supply chain management,” HBR adds.  

Making the Shift 

Some companies are already experimenting with different ways to make the shift into an automated supply chain. Robotics and artificial intelligence (AI) are already being used to digitize and automate the more labor heavy and repetitive tasks within the supply chain. While this applies to warehouse and distribution center mechanics, such as order picking and selecting, it also applies to front-of-the-house tasks such as purchasing, invoicing, accounts payable, and various facets of customer service.   

The use of predictive analytics is giving companies better insight into upcoming demand which is vital for shoring up in times of demand volatility, as well as making better use of in-house assets, and cutting costs for customer service functions without sacrificing quality.   

Intelligent Design Leads to Smarter Operations  

One of the big aspects of this technological shift is sensor data. The data collected can better monitor machine use and maintenance which can reduce downtime by providing real-time alerts on upcoming maintenance reducing the chances for machine breakdowns.   

Blockchain technology is also growing in both popularity and utilization as a means to radically optimize how different parties collaborate and communicate within supply chain networks. Instantaneous and complete data chains can provide users, end-to-end, with complete visibility of the entire supply chain process from initial components and raw materials to completed products slated for delivery.  

Transportation procurement should also be digitized in order to keep the pace.

Transportation Management Systems (TMS) will also be playing a role in the supply chain shift. Given the newfound agility of the digitized supply chain, it makes sense that transportation procurement should also be digitized in order to keep the pace. Many companies are looking more to 3PLs and intermediaries to find capacity and book freight, trusting in their systems to reduce the time and effort previously required to perform this task.  

As we mentioned before, robotics are seeing a heavier implantation rate for warehouse and fulfillment center operations. Rio Tinto, a global mining consortium, has been exploring automated metal mining operations for the past several years. This would make use of driverless trains, automated trucks, cameras, lasers, and tracking sensors, all of which would allow the supply chain to be managed remotely while improving safety and the need for personnel in remote locations.  

Less Personnel: More Control 

One of the concepts set forth by Rio Tinto and other companies who are taking the automated approach to supply chain management is the “digital control tower.” This is, in essence, a virtual decision center which is equipped to provide necessary end-to-end visibility in real time across the global supply chain. For smaller companies, these control towers have become the command center for operations. For those working in these control towers, it is their job to keep their thumb on the pulse of their supply chain, monitoring the influx of data 24/7 for any inventory shortages, bottlenecks, or literally anything else that could disrupt their supply chain operations.  

The control towers serve as the front line for a supply chain, allowing planners to quickly adapt, change, or reroute the supply chain to correct any of these potential issues before it becomes an actual problem. This works not only for retail companies but for industrial companies as well. “One manufacturer’s complex network moves more than a million parts and components per day. The control tower flags potential supply issues as they arise, calculates the effects of the problem, and either automatically corrects the issue using pre-determined actions or flags it for the escalation team,” says HBR.  “Similarly, a steel company built a customized scenario-planning tool into its control tower platform that increases supply chain responsiveness and resilience. The tool simulates how major, unexpected equipment breakdowns — so-called “big hits” — will affect the business and points to the best risk mitigation actions,” they added.  

Is This the End of the Supply Chain Manager? 

As more and more things turn towards automation, there is always the concern that human positions will be replaced and outmoded. This has, typically speaking, only affected the lower end of the spectrum, those positions that perform the menial and repetitive tasks. However, as the supply chain itself is becoming more and more automated, will we see a need for supply chain managers in the future or will they too be replaced by AI and computers?  

Rather than simply managing people to do the repetitive work, they’ll have to manage the data flows.

 Ultimately, the answer is no. Much like any position that could be replaced by a robot or a computer algorithm, there will always be a need for some human intervention. For supply chain professionals, this will mean focusing on different skill sets in the future. Rather than simply managing people to do the repetitive work, they’ll have to manage the data flows. Analyzing and interpreting the data to make the best possible decision when handling a potential issue. This skill will require learning how to make the most of digital tools, analyze and validate data sets, and make an effective forecast from the data provided.  

It will be the companies and the specialist who can adopt and adapt to the new technologies that will come out on top.

Companies will have to change their approach from the tried and true to the new order. Supply chain management, as we’ve known it from the past is on it’s way out. It will be the companies and the specialist who can adopt and adapt to the new technologies that will come out on top.  

As manufacturing and decision making become more automated, transportation will also be a vital area of focus for companies. Both the supply chain and transportation are in the process of evolving into something completely different from what we’ve seen in the past. Companies will have to adapt, and quickly, to these changes if they want to keep their supply chain flowing smoothly. While the digitization can help with that to some extent, there are some areas in which it will fall short.

A Vital Asset 

Third-party logistics providers will become vital in this disruptive era, helping companies navigate the shifts and changes within transportation logistics as they occur. BlueGrace not only provides clients with the bandwidth to create transparency, operate efficiently, and drive direct cost reductions, but our proprietary transportation management system, BlueShip, is free!  For more information on how we can help give you the visibility you need and adapt to the future, feel free to contact us using the form below: