Implementing Layered Technologies In Supply Chain Digital Transformation
• How does technology help in supply chain?
Real time and actionable data – In order to provide great service to customers, real-time inventory data at your fingertips that is accurate and actionable is needed, no matter where the part is located worldwide. Radio Frequency Identification (RFID) chips, barcodes and scanners are vital pieces of equipment that can provide infinity benefits to your business. For example, RFID chips or barcodes can be placed on every product, which gives your company a way to easily track inventory. With computerized product management, RFID chips and a barcode system provide increased visibility that can substantially improve your supply chain efficiency by detecting any order anomalies as they occur then enabling employees to immediately correct mistakes and reduce errors. Such technology also allows for easier, more consistent tracking throughout your supply chain, giving you maximum control and visibility over parts, whether those are motherboards or processors. Knowing what you have and where it’s located leads to supply chain efficiencies and lower operating costs.
Visibility across your supply chain – Cloud-based computerized shipping and tracking further simplifies the supply process when paired with RFID technology, and can dramatically reduce shipping errors. Software like FlashTrac and its mobile version Flash Lite enables savvy business owners to consolidate all aspects of their supply chain in one place. The apps enable you to digitally organize inventory data, monitor and manage shipping and tracking information, and create electronic invoices with ease. Such supply chain management technologies make it easy to greatly reduce the time spent shipping, receiving, tracking, and compiling order data. This saves your company both time and money. Last but not least, enhanced data availability makes it easier to produce customized reports and auto-generated reports that help your customers and you better understand where opportunities for improvement.
Simplify your supply chain – It is common sense that the more links there are in your supply chain, the more convoluted and complex that chain becomes and the more prone to errors and delays. Investing in supply chain technology helps your company simplify its supply chain, eliminate unnecessary links, improve efficiency and reduce expenditures. Risks associated with shipping and receiving is lowered when the number of links in your supply chain is optimized. For instance, you may find you can decrease the number of vendors for a particular part to two or three companies rather than five or six, and still meet your company’s service obligations and mitigate your risk around unpredictable events, such as natural disasters or a potential trade war. Customers turn away from businesses that routinely have shipping delays, shipping errors, and products that are out of stock. Enhancing your supply chain technology can minimize risk and improve your company’s reputation within the industry.
Enhance customer communication – Business communicates faster and more efficiently with customers by creating predictability, consistency and visibility within your service supply chain. Ideally, your supply chain technology will give you immediate access to all the real-time, actionable information you need, such as:
- Parts order tracking
- FSL location map
- Location of specific parts availability globally
- Location of parts nearest the customer
- Tracking field tech support personnel
For an example of how this might work, let’s say a server is down and your customer needs a processing chip to fix it. You can enter in the part number, the location where the part is needed, and the system will tell you where to ship it from. If your company hasn’t already jumped on the social media platform, this is another communication tool to add to your supply chain. You can use social media accounts to interact with customers, respond to questions, report accidents or weather conditions that may impede delivery or service schedules, and create automated updates about your inventory. Social media can also increase the visibility of your company and improve demand for your products and services. To stay ahead of your competition, it’s essential you continually adapt to emerging tools. Supply chain technology can greatly enhance your productivity as a company by helping you cut costs and improve customer satisfaction.
• How does implementation of layered technology help in transformation of supply chain?
- The digital supply chain transformation is on its way. The digital supply chain transformation is coming and digital leaders are driving up customer expectation, which is leading to higher standards. The intelligent leveraging of new technologies within layered modularized systems will decide which companies are successful in the future.
- Technology focus – Analytics and automation – The two key aspects are analytics and automation. Detailed information Sensors is allowed by sensors to be gathered at the machine and product levels, which is subsumed under the term ‘internet of things‘(IOT). Without us noticing data is gathered. Similarly to a car signaling a driver when its oil is low, entire production systems send data to a centralized computer, which analyzes the datasets and creates valuable information out of it by predicting when the machine will break down. When breakdowns can be reliably predicted, a technician can be sent to the machine in advance, avoiding unexpected machine downtimes. This is called predictive maintenance. If the machine orders the technician by itself, we are talking about automation. Automation is already in place in many flow productions for standardized product lines all over the world. The pharma industry, for example, makes its products without any human participation in the execution process. The next big thing is to bring down this high level of automation to lot-size-one production. Machines have to be highly flexible to make it operation able, changeover times must tend toward zero and the planning process must be automated to allow system orchestration. ADIDAS for example has already implemented this visionary approach in its Speed Factory. It combines the design and development of sports products with a flexible, automated manufacturing process. This flexibility allows ADIDAS to be much closer to the market and meet customer demands faster than its competitors to be gathered at the machine and product levels, which is subsumed under the term ‘internet of things‘.
- Source connection – Involves layering technology that can connect to any data source – even raw data from the machines on your shop floor – and standardize the data so that it can be aggregated, analyzed and visualized across the enterprise in real-time. Users don’t have to access multiple point solutions or machines to get the information they need.
- AI – Artificial Intelligence (AI) also plays a huge role in this type of decision making as. If all data used for supply chain decision support exists in one place, planning becomes significantly faster and more effective. AI technology is becoming more prevalent as businesses become increasingly more automated and has already demonstrated that it will be useful removing complexities, predicting orders and reducing costs along the chain. Data is now flourishing across all sectors and businesses can use AI to analyze all known data to create ultra-accurate demand forecasts that combines with machine-learning to sift through what is relevant and what isn’t. To have pure visibility the right data must flow smoothly across all partners, from suppliers to retailers and everyone in between, to be transformed into actions.
• How does digitalization as an emerging technology impact supply chain?
- As the adoption of a new form of industry continues to sweep through industries around the world, including the supply chain sector, it brings with it innovative technologies that have never been witnessed before which can completely transform the operations of a supply chain network, company or procurement process. Two of the biggest benefits that supply chains can take from digitizing their processes are speed and cost. Taking your operations to the next technological level can significantly cut the time it takes to make strategic decisions, whilst also boosting operational efficiency. By improving pricing and operating costs, manufacturers also believe they will see increased sales from more digital processes. End-to-end transparency is the ultimate goal for a number of supply chain operators, being the crucial component to achieving significant efficiency gains. In a system with end-to-end transparency, every member of every step along the supply chain network will have access to all data. Digitizing processes can enable improved visibility and provide real-time insights into the supply chain, giving people along the chain full control. During the COVID-19 pandemic, countless supply chains have been crippled around the world due to their outdated systems. Traceability can fall apart when certain aspects of the network have to close due to unforeseen reasons. Many processes that revolve around deliveries still run with a face-to-face, paper-based signature. Whilst social distancing measures are in place, this can be difficult – if not impossible – to carry out, causing further disruptions to supply chains. Using a digital approach to these typical systems can eliminate the need for face-to-face interactions, improving business both during and after the COVID-19 pandemic.
• What is digital supply management and ways in which technology is remolding digital supply chain
Digital supply chain management is really just supply chain management with an added layer of digital technologies. These technologies include: Predictive analytics to optimize inventory allocation and forecast demand. Automated replenishment solutions and robotics to speed up assembly or picking.
Ways in which technology is remolding digital supply chain are:
- Transparency and footing for long-term decisions – Deployment of a unified business platform involving all departments and offering a user-friendly interface plus a connected, interactive environment. The process is simplified further to create a transparent data pool available to all the departments, comprising centrally held company data which contributes to better decision-making accelerating the manufacturing processes. Such integrated platforms are ideal for advancing the digital adoption of supply chain management. In addition to a central data pool, it offers applications for computer-aided support in decision-making processes. Accelerating the process of a company to assess its supply chain from different angles and optimize it accordingly. The emphasis to date has been mostly on deciding between optimization costs and service to the customer. If service is a priority, for example, minimizing costs will tend to be the second priority. To sustain the reduction of costs, it is observed that quality services usually have to compromise.
- Make to stock or make to order – How products are manufactured today will change increasingly. To date, there are two classic concepts in the supply chain: make-to-stock (MTS) and make-to-order (MTO). Depending on how a company manufactures its products, the so-called order penetration point varies in the supply chain. MTO places a heavier demand on processes in a supply chain compared to MTs relying on order penetration on the general demand. And this is where the digitalization of the supply chain plays a substantial role. In planning the supply chain, many enterprises today must decide on a trade-off between costs and services. In the MTS domain, the costs are usually reduced maximally during the production process. Turning to MTO, individualization, and service to the customer is a priority over cost.
- Customization – The biggest challenge and focus area for companies today and even more so in the future, is to enhance customers’ experience and sustain consumer engagement. Recently we have observed that the majority of consumers would purchase customized products with a fast delivery service, regardless of their location. That means the market offers a sizeable demand for companies and their supply chains. And this trend forecast illustrates why time is of the essence for companies to promptly address the digitalization of their supply chain.
• Conclusion – 3 ways in which supply chain is strengthened are:
- Increase efficiency in the supply chain and logistics operations
- Automation – Can be implemented in various parts of the supply chain to reduce repetitive and error-prone tasks the employees can focus on higher-level tasks. Robotic process automation(RPA) enabled with artificial intelligence (AI) can be integrated with the shipping management software and relieve logistics managers from repetitive tasks, which can cause inefficiencies. For example:
RPA can help automate shipping schedule monitoring and provide regular updates to all relevant parties with automated email communication.
RPA can also be integrated with freight billing systems to automate invoice processing, credit collection, and follow-up on payment completion from hundreds of third-party logistics companies.
- Improve procurement process – Implementing cloud-based procurement systems in your business can provide real-time costs tracking that can help in avoiding budget exceeds and improve overall cost efficiency. Online procurement software can make the purchasing process more accurate and transparent. For example, cloud-based order processing can efficiently perform tasks such as order management, order fulfillment, and billing. Companies can also improve supplier management through this technology by making better decisions on which supplier to invest in.
- Reduce management costs – Supply chain managers need to take a more holistic approach to achieve costs reductions and success and this is how digitalization can help us reduce costs.
- Improve resilience across the supply chain – The recent pandemic acted as a testfor supply chains and identified many weaknesses. Companies faced rapid fluctuation in demand and supply that resulted in many supply chains to collapse. Hence, supply chain managers need to strive for more flexibility and resilience. Digital transformation enables supply chain managers to increase resiliency in the supply chain to handle uncertain situations such as the pandemic.
- Improve demand forecasting – Supply chain managers can leverage predictive analytics powered by ML, AI, and IOT to help predict more accurate forecasts. Here are some real-world examples:
Luxottica, one of the world’s largest eyewear companies, uses ML in its demand forecasting. Through the smart forecasting engine, the company managed to increase its accuracy by 10%.
Costa coffee uses IOT devices in its coffee machines that send real-time sales data to the company to improve demand planning.
Samsung leverages AI to improve its demand forecasting accuracy
- Improve visibility and tracking – Business partners can be helped in managing potential risks and problems by introducing systems within your supply chain that provide real-time shipment information can. For instance, RFID (Radio-frequency identification) technology can be used to trace shipments to enhance end-to-end supply chain visibility accurately.
- Identify root causes – Process mining in logisticscan help optimize logistics operations by identifying the root cause of delays and improving resilience in the supply chain.
- Collaborate and share data – Cloud computing provides uninterrupted access to data that supply chain managers are dependent upon for making critical business decisions. Through cloud computing, all business partners in a supply chain can work collaboratively by sharing important data.
- Enhance sustainability in supply chain and logistics – Digital technology is the way towards more sustainable supply chain and logistics operations.
- Reduce fright transport emissions – Vehicle routing software based on AI can enable a significant reduction in logistics emissions. This software uses sophisticated algorithms with environmental parameters to provide optimal vehicle routes to improve your transport network. DHL uses its transport network optimizing system to significantly reduce greenhouse gas (GHG) emissions.
- Improve your fleet’s behavior – Modern telematics tools help in reducing the carbon footprint of a logistics fleet. This can be done by gathering and analyzing the data from drivers and using it to reduce vehicle idling. As a result, companies can significantly reduce their logistics carbon footprint. To facilitate this solution, logistics fleet managers must also provide proper training to their drivers on how to drive safely, efficiently, and sustainably.
- Block chain for more transparency –Block chain technology is used to store information accessible to all business partners within the supply chain. Block chain technology has implications in sustainable supply chain management’s social and environmental aspects. For example, since supply chains become truly transparent through a block chain system, the company can ensure ethical practices and better track carbon emissions disclosure from suppliers. Since this technology is relatively new, managers are advised to study and understand its implications in their own business before investing in it. Samsung provides solutions for enhanced business transparency based on block chain.