Back in the 1950s and 1960s, people talked about the coming age of color television. Now, no one talks about the novelty of seeing daily programming in living color. The conversation has progressed to the usefulness of multimedia centers where all sorts of devices and capabilities intertwined.
A similar transition is happening in the supply chain right now, said Lora Cecere
founder and CEO of Supply Chain Insights during the recent webinar, Making the Digital Pivot. Everyone is talking about the digital supply chain, but many aspects of the supply chain have already become digitized. The supply chain is already a digital supply chain, but, like the color television, the conversations and vision around it need to expand.
To move through this transition and create more advantages, companies should begin imagining what the digital supply chain can be (or grow up to be), and consider how new technologies, advanced analytics, robotics and visualization could help usher in supply chain advancements, Cecere said.
A challenge many companies face today is figuring out how to get supply chain to stand for more than distribution, sourcing, manufacturing and customer service and how to evolve the digital supply chain into an engine for growth, innovation and market expansion globally and into emerging economies.
Cecere pointed out several ways companies can pivot in this direction.
One way is to think about how to close the gap between the commercial and operations teams. The digital supply chain creates an opportunity is to address "the long tail of the supply chain," she said.
It's common today that while new products are coming to market, demand is uncertain and timing for consumer adoption is unknown. Also, the software from the 1990s that is still widely used was based on a plan, check, do and act closed-loop process. Moving towards digital processes and digital businesses is more about sensing things, Cecere said. The digital supply chain will involve more of a sense, plan, test and learn, shape and orchestrate, and act footprint. Investing in this shift will help companies better address supply chain's long tail, leverage channel data to learn more about what customers want and how to get products to market, build bigger network value, and increase product customization and personalization.
There is also a confluence of disruptive technologies that could significantly impact supply chain effectiveness, she added.
Advanced analytics, for example, will be one of the key areas companies invest in through 2020, and one of the ways to get supply chain to learn and to sense what's happening as opposed to just responding to what's happening, according to a Supply Chain Insights poll.
"Most organizations are very early in their adoption of analytics. They are still investing in descriptive analytics...things that allow us to see but don't necessarily allow higher intelligence for decision support. Then we have the predictive analytics, which is the optimization that we have supply chain planning," Cecere said. "As we move to prescriptive and cognitive analytics, where I no longer have only an outcome, but an outcome that's better and based on current data.
By 2025, Cecere said that spending that while analytics drops, the Internet of things (IoT), 3D printing and robotics will get more attention and continue to pivot the supply chain deeper into the digital realm. Along those lines, for example, combining analytics with streaming data from IoT devices and portals will help define new and different data models and structures. Likewise, 3D printing and robotics will enable a host of opportunities that will compel supply chain to change even further.