Digital Supply Chain Transformation: How to get started?

Digital Supply Chain Transformation: How to get started?

The transformation of the supply chain has now officially started. A significant milestone has been reached in designing the desired future state and preparing a thorough development roadmap. There are over 126 million web results for “Digital Supply Chain Transformation,” which represents a sizable amount of information to help organizations with their digital transitions. Despite having these tools, research indicates that up to 53% of attempts fail to accomplish their objectives.

Transformations of the digital supply chain go beyond IT projects.

No matter how enticing it may be to believe that technology will make all of our problems disappear, the software is only an enabler. The amusing thing about software implementation is how simple it is to become lost in the plethora of requirements for data, interfaces, skills and labour shortages, etc. Sometimes, amid the confusion, you lose sight of the main reason you started your transformation path.

Business cases are the first step in transformation.

Anything from enhanced consumer interaction to increased production could be the answer. The IT team must lead the initiative to implement technology, as one might anticipate. The leadership team should monitor the digital implementation, verifying suitable ties to the business case, nonetheless, continue.

The digital supply chain transformation team should never be afraid to pose the broader “so what” question. How can [insert important business goal here] being achieved by this enormous (and expensive) effort help us?

Make sure you can respond to queries like, “How is the organization reducing slow-moving SKU safety-stock levels as a result of the adoption of the inventory management software?” Will this enable us to better meet customer demand by stocking more of the quickly moving SKUs at higher levels using the freed capacity? The whole endeavor will remain on track if the connection between your implementation use cases and your specific business objectives is regularly traced. Keep track of and manage the expectations of your stakeholders.

Trying to accomplish every objective imaginable might not be the best action.

Every year, Inxiteout encounters hundreds of requests for proposals (RFPs). Upon closer examination, we discovered that just 25% of the requested functions are real differentiators traced back to particular business use cases. The rest are merely “nice to have” features. In essence, this is just another illustration of Pareto’s law.

The leadership team should thoroughly review each business use case involved in the initiative to transform the supply chain digitally. Sort these according to their urgency and the required level of organizational development. Which business use cases should be included in the transformation process will be organized with the aid of the Moscow Prioritization Matrix.

You can estimate the task’s quantity (and scope) with the aid of this categorization, and you can concentrate on the crucial standards.
The essential business use cases must also be connected to actual business KPIs. Through predetermined software data outputs, track these KPIs.

A greater consensus around overarching goals

Transformational projects span organizational silos. Since various departments frequently pursue distinct KPIs, it is crucial to make the core team—which, in an ideal world, would include all stakeholders—aware of the transformation project’s more significant goals. For instance, the finance department can insist on a decrease in working capital, which will inevitably result in lower inventory levels.

However, the planning solution will definitely suggest raising the inventory at specific buffer locations if a higher goal of the digital supply chain transformation project is to improve customer service to achieve that goal. Here, it is preferable that all parties involved agree on optimizing inventory levels rather than just raising or lowering them.

Most significantly, everyone involved must comprehend that, while robust debates are required before choices, a firm commitment is required once a decision has been made.

Crawl, walk, then run is how it’s done!

Take your time during this phase. Give your team enough time to comprehend the software ecosystem and its functional capabilities related to accepted business use cases. Invest as much time in the blueprinting stage as is required.

Choose your data sources carefully, then verify their reliability. Learn about the underlying technical difficulties. In the long run, a successful implementation that took a little longer than anticipated will be more beneficial than a hurriedly completed, on-time implementation.