SUPPLY CHAIN DIGITISATION

Summary
  • Digitalisation is changing the demands on supply chain management enormously
  • Existing ERP software is not always equipped to meet these exacting requirements
  • Digital supply chain processes are even more strongly geared towards networking the value stream and the value creation partners

An increasingly strong division of labour and networking of value creation partners inevitably leads to a stronger consideration of the supply chain. The classic requirements of a supply chain have changed. Inventory management has been expanded to include supplier connectivity and logistics partner connectivity. This represents an enormous challenge for many companies. In parallel, old ERP systems and ERP software are not always able to map and support the requirements of the digitalisation of the supply chain.

Mastering the processes of a digital supply chain will become one of the decisive factors for survival and revenue in a company.

The Supply Chain in the Digital Network

Inputs, materials and necessary services are increasingly sourced from suppliers across multiple tiers. Speed of delivery can be a key competitive advantage. The exchange of information between the participants must function smoothly and the flows of goods and information must be reunited and harmonised at a defined point in time. A prerequisite for this is also a high quality of the existing master data.

 

Process Quality and Process Transparency in a Digital Supply Chain

If primary products are procured via different stages of the value chain, there is a high probability that material is physically present at several points or warehouses. Inventory management and stock levels cost money and, in an innovative competitive environment, have the disadvantage that they may no longer be sold. New products or product improvements have drastically devalued stock.

Therefore, it can be important for all parties to participate in the exchange of all data as part of process and information transparency.

 

Data Transparency Along the Value Chain Requires Trust Among Stakeholders

Customer demands and competitive pressures can lead to a situation where those involved in a supply chain network have to exchange information via different touch points or logistics nodes. These can be: 

  • Production nodes,
  • Assembly nodes
  • Warehouse nodes

Each of these individual touch points or nodes has different characteristics that must be taken into account when optimising the digitalisation of the supply chain. As an example, a regional warehouse may serve B2B customers as B2C customers. While end customers' requirements for service are gladly higher than those of B2B for a regional warehouse, it becomes clear that this regional warehouse serves 2 customer classes.

These and many other requirements have to be considered in a digital supply chain as requirements in logistics software or ERP systems. ERP specifications for ERP software requirements are suitable platforms for defining these processes.

Approaches to answer such questions with I.T. solutions and to support the processes with ERP software are tasks that should be discussed within the framework of a digital supply chain initiative.

This also concerns the cooperation with suppliers and customers.

  • Should a platform for exchange be defined?
  • Should a hybrid solution be sought or designed?
  • Where should data and transactions be stored?
  • Data security and data access - who has what rights and obligations?

These and many more questions are part of a consultation for a future-proof digital supply chain that helps to reduce costs and realise competitive advantages.

Experienced experts for your team will help you realise savings potentials in the 2-digit percentage range.

 

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