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Modernizing the Supply Chain & Its Implications for Technology

According to IDC Manufacturing Insight’s report for the worldwide manufacturing supply chain industry, this year the supply chain technology investment will involve a radical modernization to existing systems and also the incorporation of new approaches. All of this is expected to increase over the coming years, and by the end of 2018 achieve the predicted goal that puts supply chains on top of the list of leading revenue along industries.

As predicted by IDC and with a promising future ahead in 2014, supply chains will focus on modernizing their existing systems without the CFO getting off the budget. Instead, organizations will adopt and modernize according to the company's needs and always with an eye to maximizing return on investment (ROI). The areas chosen for investment will determine great results in improving capabilities. The investment will usually take the form of third platform technologies, such as mobile computing, social networking, cloud services, and big-data analytics technologies.

Modernization and its implications for technology
Modernization has always been a never-ending process in every industry along the history of humanity, and supply chains are not the exception. Taking into account operational resiliency as an important, ongoing theme for global supply chains, there are some implications for technology. IDC Manufacturing Insight has put together the following list:

  • Faster and more integrated planning, in terms of both better linkages to demand signals and deeper scenario planning
  • A broader adoption of cloud-based tools, for edge applications like transportation management, but also in key orchestrating capabilities like sales and operations planning (S&OP)
  • Supply chain risk and resilience investments, particularly in supply chain monitoring and visibility
  • Renewed interest in the data management organization (DMO), with key participation from IT
  • Investments in execution excellence, notably around more integrated supply chain execution and the delivery of “product-wrapped services”

More IT professionals, more tech savvy
Industries constantly evolve and change. Looking for ways to modernize the supply chain is in order. With the implications for technology mentioned above, one can only think that this modernization is also going to put new and evolving demands on IT departments. Long gone are the days when only one IT savvy person in the company was enough to solve all the difficulties and bring state-of-the-art technology to the day-to-day enterprise routine. Today, with emerging technologies blooming like wild daisies in spring it is necessary to counter with an IT team big enough and capable enough to deal with new things emerging and changing on a daily basis. Continuous modernization will always be the most beneficial choice.

9 comments on “Modernizing the Supply Chain & Its Implications for Technology

  1. prabhakar_deosthali
    February 27, 2014

    While continuous modernization has to be the key for the Supply chain systems, one has to make sure that the systems that are chosen are AGILE, so that they can easily adapt to the perputual change that is the order of the day in the current technology scenario. 

    If the time taken to modernise is long then by the time the enw systems are implemented , the world may have already moved over to something better.

  2. Susan Fourtané
    February 27, 2014

    Prabhakar, 

    That's a great truth and the reality of every industry and the world, not only the reality of supply chains. This is why the best is to be early adopters of the new technologies so when it's time to modernize again you already had time to take advantage of the previous one.

    It's also less costly when you have to moernize one thing at a time instead of all your technologies. This is where the IT department and the CIO play an important role in being active keeping everything updated. 

    -Susan

  3. jbond
    February 27, 2014

    I know a few companies that are having trouble with modernizing because they aren't coordinating with IT or an IT company and it is causing problems and slowing them down. One company in particular had about a year of very low production and sales because of this. I think it would be great if they could all modernize together or work together to find solutions.

  4. Susan Fourtané
    February 27, 2014

    jbond, 

    Unfortunately some companies fail to understand how not modernizing affects their business. They don't wan to spend money but they lose even more as sales soon decrease. Their customers move to a supplier that has invested in new equipment and new technology. 

    Who do you think they could modernize together?

    -Susan

  5. jbond
    February 27, 2014

    I don't have a suggestion on how they could modernize together. It was a thought.

  6. Himanshugupta
    February 28, 2014

    I will not have money to purchase the article as it costs $4500 but can i get some more inforamation about the source and data used in the article. Or best get the article from someone?

  7. ITempire
    February 28, 2014

    Prabharkar, this challenge of agility is to be taken seriously by traditional leaders in MIS such as SAP and Oracle. Saas is something that many supply chain professionals may seriously consider over these traditional MISs.

  8. ITempire
    February 28, 2014

    Jbond, there is often one who initiates. It is either the business or it is IT. If IT initiates, unfortunately the results are often not great. However, IT must capitalize whenever they get the opportunity.

  9. ITempire
    February 28, 2014

    Susan, central decision making by IT Department will often result in aligned systems across the enterprise. This results in streamlined data, monitoring of security and quick identification of problems and their resolution.

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