Empty shelves, delivery delays, and increased shipping costs have received much attention from the general population since the pandemic began in 2020. According to the online publication Axios, 75% of U.S. companies’ supply chains were disrupted early in the pandemic.
But as supply chains emerge from the pandemic, demand and supply continue to be at odds with each other. As such, organizations are investing in technology to better align demand and supply by boosting efficiency, automating processes, integrating systems and data, and improving visibility throughout supply chains – all of which ultimately increases customer satisfaction and improves resiliency.
Indeed, what were once considered linear supply chains have become complex, circular supply networks central to business resilience, success, and growth. Supply chains built initially on legacy technologies are shifting from being reactive to proactive in order to address the volatility in today’s environment strategically.
Digitalizing Supply Chains
Supply chain digitalization is the transition from traditional legacy systems and processes to more advanced, proactive digital tools. Digital supply chain management offers more flexibility and intelligence to deal with pressing and common challenges inherent to today’s supply chains.
To begin the transition, organizations must first assess their technologies to identify where upgrades or add-ons can be deployed. Legacy systems are often outdated and siloed, not fully integrated into the other systems organizations use. These legacy systems, which can include bespoke applications, enterprise resource planning software (ERPs), customer relationship management systems (CRMs), warehouse management systems (WMS), transportation management systems (TMS), hardware, and network infrastructure, often create a barrier to more efficient operations.
Today’s solutions remove such silos and enable organizations to implement companywide solutions to manage internal and external data used to support efficient and effective business decision-making. The benefits of updated technology systems and platforms can improve decision-making throughout the supply chain process by helping decision-makers to:
- Be aware of what’s happening across the end-to-end supply chain.
- Analyze information through visual dashboards and easy-to-understand data using analytics and emerging technologies such as AI and machine learning.
- Identify opportunities to improve the performance of the supply chain, which can lead to improved profitability and better customer experiences.
Systems such as warehouse management systems (WMS) and transportation management systems (TMS), for example, are core to supply chain operations, and have significantly evolved over the years by embracing software-as-a-service (SaaS) and creating flexibility through the integration of cloud technology. Among the many benefits of cloud technology is that it offers higher levels of security, better performance and real-time updates and reporting. Cloud access and quality data are considered the foundation of visibility and data management, a powerful combination for today’s supply chain management.
Combined, such platforms can:
- Extract, translate, and deliver complex, unstructured data into structured, usable data for analysis.
- Define and apply business rules, logic, and data validation to accommodate commercial terms and agreements in business-to-business (B2B) relationships.
- Resolve exceptions quickly with real-time alerts.
Other technologies that are being utilized in digitized supply chains include:
- Artificial intelligence (AI), which is being used for such analysis as demand forecasting and planning, optimizing routes and inventory management.
- Blockchain for payment, audit transparency and counterfeit detection.
- Internet of Things (IoT), which is used to monitor temperature and other environmental exchanges of goods while in transit; asset management; connected vehicle monitoring.
Benefits of a Digital Supply Chain
Once a supply chain undergoes digital transformation, all processes and operations are performed with little manual assistance. This helps achieve greater efficiency, velocity, and improvement in transparency, boosts employee performance and productivity, and does away with time-consuming recurring tasks.
Additional benefits include being better positioned to meet evolving compliance directives related to trade practices, environmental mandates, and laws governing tracking and tracing items along the network.
Lastly, digital supply chains are more resilient and adapt quickly to unexpected challenges that can potentially impact them, such as geopolitical issues, natural disasters, and pandemics. An enterprise-wide digital transformation can seem overwhelming, especially when faced with existing day-to-day supply chain challenges. The good news is that Hartman is here to guide you on this journey as you forge a path from siloed, inefficient legacy systems to a fully integrated, digital environment. Reach out to our experts to learn more about how Hartman can help you on this journey.