The Digital Supply Chain

In today’s increasingly digital world consumers demand speed, flexibility and accuracy – disrupting traditional business models and supply chains. How to enable organizations to successfully balance customer demand, internal efficiency and innovation? Rethinking the supply chain to successfully deliver added value in an ever changing and globalized setting requires vision, technology and change management.

The 2020 CIMCIL Symposium offered some inspiring insights from various supply chain experts and explained how we can cope with the rapidly evolving digital market and cover today’s demands from people and processes within and without your organization.

Global trends

Hans Maertens, Managing Director of VOKA, discusses three main trends currently shaping supply chains and logistics. The first trend is globalization. Technology allows us to easily and swiftly communicate with others across the globe. The world is increasingly interconnected, from start-ups operating globally to students studying abroad. The second trend in supply chain is sustainability. All over the world youth is championing for an environmental change. Logistics are becoming cleaner and expose less and less CO². Sustainability has become a necessity for companies to survive, logistics isn’t part of the solution – it is the solution.

The third biggest trend is a changing society and demography. Western European societies face an increasingly aged population, while lower to middle income countries see rejuvenating. We can only solve this paradox by changing the labour market by way of migration and organise logistics & transport in an even more efficient and sustainable way. Organizations can successfully face these three trends by embracing digitalisation and innovation to drive their supply chains and working towards a more efficient, yet sustainable global future.

From S&OP to strategy-driven S&OP

Bram Desmet, author & supply chain expert, shared his vision on rethinking the supply chain and helping companies to strategically use their supply chain to create a competitive advantage. The mission of supply chain management is to balance the supply chain triangle using processes, tooling and analytics to integrate strategy, finance and operations.

The goal is a higher ROCE or Return on Capital Employed. The supply chain triangle represents the struggle between sales (service), operations (cost) and finance (cash). To bring balance to the supply chain triangle, an organization needs a strategy built on their customer’s expectations. Different strategies will lead to different balances and your defined strategy will impact the design of your supply chain.

How Data and Analytics drive a Digital Supply Chain

Bart Van der Vurst, Director Analytics at Element61, shared some inspirational and hands-on examples of how data and analytics drive a digital supply chain. From using AI to improve supply chain planning to enabling preventive maintenance for equipment based on predictive forecast using IoT. The essence is a data-driven supply chain benefiting internal teams and processes, external partners and the customer.

There are multiple stages in capturing added value from data and analytics: What happened? - Why did it happen? - What will happen? - What should I do?

The baseline however is always the same: a digital supply chain requires a connectivity layer. Built on top of this connectivity layer, a data foundation and analytics running on a modern data platform allow for integration and data applications.

But reality for a lot of organisations means facing challenges like limited hands-on experience, unknown choice of technology and lack of consolidated efforts. Some are working with information manually entered into Excel, data is only descriptive and reliability is spotty.

For organizations to transform their supply chain to a digital one, it’s important to know it’s a marathon, not a sprint. To tackle the trade-off between maturity and time spent on data collection vs. decision making they’ll need people, tools, processes and - most of all – and end-to-end plan. By identifying gaps and opportunities, implementing the right technology and crunching your data, the digital supply chain builds competitive edge and opens new business opportunities.

Increasing organizational efficiency and effectiveness

Presenting his findings on organizational efficiency and effectiveness, Edwin Van Vlierberghe believes there are five major enablers to achieve an integrated supply chain. Lean logistics, interface management, high performing suppliers, supply chain organization and digitalization all ensure integrated material and information flows throughout the supply chain resulting in high-performing teams achieving goals on time, quality and costs.

But how does one drive digitalization in the supply chain? Edwin discussed three drivers for organizational change: business components (“How can new technology serve us?”), ensured employee involvement from the beginning and a consistent leadership style. In the supply chain of the future digitalization is a tool enabling new organizational design as the vehicle for success. The digital supply chain is an integrated supply chain without traditional handovers and focus on functional performance, but instead thriving on smooth and streamlined processes.

Our four speakers illustrated some invigorating examples on how to drive the supply chain towards value creation in an increasingly digital environment. From identifying global trends and enablers across the digital supply chain, to strategically setting goals and sharing specific examples of analytics driving a digital supply chain – the 2020 CIMCIL Symposium was able to enlighten 100+ supply chain professionals on the exciting and digital supply chain of the future.

Author: Marlies Helmer - Senior Expert Consulting  @ Moore Belgium