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The Digital Supply Chain: How Are Supply Chain Managers Responding?

How do you define the digital supply chain? Do you isolate it to processes involving the internet, or do you take a more progressive approach and combine cloud-based technologies, integration and unmatched customer service into one, data-based solution?
Most supply chains have been involved in digital processes for years. Even computerized picking systems rely on the digital supply chain, but the digital supply chain relies on the actions of supply chain managers for continued growth. Managers must understand the digital evolution in the supply chain and respond in kind, explains Forbes magazine, with integrated planning and execution systems, automated systems, smart warehousing and procurement practices and much more.

Managers Automate Processes to Respond to the Digital Supply Chain.

The digital supply chain has been called, “the Fourth Industrial Revolution,” and it is one of the greatest improvements to standard supply chain processes in centuries. According to Dale Benton of Supply Chain Digital, one of the most important ways managers and executives are responding is through the greater use of automation in their companies. This will help push the digital supply chain forward and ensure continued growth.

A Renewed Focus on Training and Skill-Development Will Support the Digital Supply Chain.

Another aspect of response to the digital supply is training. Supply chain managers have renewed their focus on enhancing the skills of laborers. This means more training and direction to use newer, more advanced systems, and many systems now offer around-the-clock support to ensure maximum operability. As a result, the overall training costs may increase slightly, but they should taper off as technology becomes more commonplace.

Companies Align Business Strategies With Public Trends.

Think about the digital world. Using technology and living in a virtual world have become public trends, so supply chains must also align business strategies with these trends. In other words, companies must be willing to create seamless, omnichannel experiences for consumers while still meeting public expectations, like reducing impact on the environment and focusing on local-sourced goods and materials. In a sense, this is comparable to the relationship between push technologies and external pull drivers in warehouse management, identified by Stefan Scrauf and Philipp Berttram.

For example, companies need to know how long delivery will take. If it takes more than three days, up to 70 percent of customers will return the product. So, faster delivery times, possible through faster analyses and application of data, may lead to better profitability, fewer returns and ongoing flow of products out to consumers.

By bringing information from internal and external sources together, supply chain managers can cut problems created when data is kept isolated. Moreover, this helps overall supply chain flow and prevents the creation of bottlenecks or delays in order fulfillment. Furthermore, this promotes a circular supply chain, so supply chain managers are reshaping standard supply chain design in response to the digital supply chain itself.

What Does It Mean?

The digital supply chain is growing at a remarkable pace. How companies respond will determine its success in the coming years, and companies that do not successfully navigate these new waters in supply chain management technology will face the possibility of oblivion and competition problems. As a supply chain manager, warehouse director or other leader in this industry, you need to understand why these common responses are essential to the success of your business.