{"id":34963,"date":"2021-06-23T10:23:39","date_gmt":"2021-06-23T08:23:39","guid":{"rendered":"https:\/\/www.intellias.com\/?p=34963"},"modified":"2024-08-12T02:42:08","modified_gmt":"2024-08-12T00:42:08","slug":"digital-supply-chain-a-technical-framework-for-adoption","status":"publish","type":"blog","link":"https:\/\/intellias.com\/digital-supply-chain\/","title":{"rendered":"Digital Supply Chain: A Technical Framework for Adoption"},"content":{"rendered":"

The call for supply chain digitization is not new. According to a PwC survey conducted in 2017, 73% of business leaders had already started digitizing their supply chains and planned to complete the process by 2021.<\/p>\n

Fast-forward to 2021, and where are we at?<\/p>\n

MHI and Deloitte run an ongoing Supply Chain Digital Consciousness Index (DCI) which helps businesses determine their levels of digital supply chain maturity.
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\nSource: MHI \u2014 Digital Consciousness Index<\/a><\/em><\/p>\n

The 2020 end-of-year survey<\/a> revealed that participating organizations scored an average of 2.1 out of 5.0. This means most companies are still in the \u201cDeveloping\u201d category, with low levels of connectivity and automation. Most are midway through their supply chain digital transformation journey.<\/p>\n

Accenture<\/a> insights also confirm a big gap between aspirations and actual results.<\/p>\n

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The average digital maturity across our panel of participants in the manufacturing industry is 39% (with 100 percent indicating full deployment), which means companies have completed pilots for some digital capabilities and have begun to scale up.<\/p>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\tAccenture<\/span> <\/span>\n\t\t\t\t<\/small>\n\t\t\t<\/blockquote>\n\t\t<\/section>\n

Indeed, last year was operationally challenging for manufacturers, logistics companies, and suppliers alike. The pandemic accelerated supply chain digitization but also heightened operational constraints.<\/p>\n

In 2021, many supply chain managers are revisiting postponed pilots and non-priority projects.<\/p>\n

For those of you who would like to make steady progress this year, we have drafted a digital supply chain framework you can use to shape up your business case.<\/p>\n

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Supply Chain Software Development Services<\/p>\n

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<\/div>\n <\/div>\n <\/div>\n Learn more<\/span>\n\t\t <\/a><\/div>\n

How to accelerate the transition to digital supply chain management<\/h2>\n

2020 was an unplanned stress test for supply chains. Not everyone passed.<\/p>\n

Over 85%<\/a> of companies struggled with inefficient digital technologies in their supply chains.<\/p>\n

Yet over 50% of executives managed to get a stronger grip on supply chain management after the hastened transition to remote work.<\/p>\n

So what is a digital supply chain in the current context?<\/h3>\n

A digital supply chain is a technology-augmented approach to managing all aspects of supply chain networks, aimed at enabling better connectivity among participants, optimizing and automating processes, providing supply chain visibility, and offering forecasting capabilities.<\/p>\n

Supply chains have multiple dimensions \u2014 processes, ecosystem partners, data flows, physical flows, etc. The goal of digitization in supply chain management is to consolidate them into a homogenous, well-run ecosystem where every participant has top-down and bottom-up visibility and new participants can join at any time.<\/p>\n

Given that modern chains span geographies, technical architectures, and business roles, this means a lot of room for optimization across different directions.<\/p>\n

The Digital Supply Chain compass maps Supply Chin 4.0 improvements caused by 6 main value drivers<\/b>
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\nSource: McKinsey \u2014 Supply Chain 4.0 \u2013 the next-generation digital supply chain<\/a>.<\/em><\/p>\n

So far, we have touched on some crucial aspects of supply chain digitization such as supply chain visibility and transparency<\/a> \u2014 the end goal for many leaders.<\/p>\n

But there are more underlying jobs to be done if you are early in the supply chain digitization process.<\/p>\n

How can you prioritize your targets for digitization to justify your budget? Here\u2019s our approach.<\/p>\n

Focus on good governance and a digital mindset<\/h2>\n

Digital transformation must be driven at the highest level of governance possible and strongly aligned with IT. Otherwise, the project will easily get derailed, postponed, or abandoned.<\/p>\n

However, only 25% of supply chain practitioners<\/a> agree that their digital projects are unified by a single governance process.<\/p>\n

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Companies that have established governing teams to manage investments, curate lessons learned, and ensure alignment are the ones that have made the most progress on their supply chain digital transformation journeys.<\/p>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\tKPMG International<\/span> <\/span>\n\t\t\t\t<\/small>\n\t\t\t<\/blockquote>\n\t\t<\/section>\n

A strong vision and streamlined governance is the first step. A digital mindset that encourages leaders to treat technology as an opportunity, not a foe, is the second step to success.<\/p>\n

Sure, you have IT as a delivery and consulting function. But to determine the optimal approach for execution, your teams need your vision and support.<\/p>\n

The MHI\/Deloitte 2020 survey notes that the three most critical skillsets for supply chain management companies over the next five years will be:<\/p>\n