Integrative Improvement Blog

The integrative improvement blog discusses and provides commentary on the latest topics in the business performance improvement sector.

5 reasons why your supply chain should go digital now

5 reasons why your supply chain should go digital now

In today’s global and connected economy, digital supply chains are the on-ramp to innovation and success. And in case you thought the term was just another buzzword created by pseudo intellectuals or the media, you’re wrong. It’s real, and if you want to be among the winners, you need to get on the highway and pick up speed. Start developing digital strategies today that allow you to proactively evolve ahead of the competition.

Achieving global growth objectives is a major challenge for chief supply chain officers (CSCOs) as they need to:

  • Continue to understand markets, customers and consumers
  • Align value chain capabilities to customer segments to support growth
  • Maintain focus on costs, asset utilisation and reliability

Responses must be adapted continually to meet changing buying behaviours and expectations and at the same time, optimal profitability must be maintained. Supply chain leaders need to understand both the organisation’s customers, as well as their customers all the way through to consumption point (end user or consumer), to truly drive adaptive and flexible supply chains.

Gaining such customer and consumer insights means answering these perpetual questions:

  • What do customers buy, and what do they buy together?
  • Where do customers shop and at what frequency?
  • Do customers shop through multiple channels and, if so, what are the similarities and differences by channel?

The digital supply chain is a radical transformative step which is influenced by the migration to:

  • Smarter products
  • Automatic identification
  • Location-based data streaming
  • Location-aware devices on people and assets
  • Sensor-based networks connecting people and things in the supply chain

In addition, cloud technologies integrated with web services are unifying information and processes to enable trading partner visibility and collaboration.

Five benefits you will realise immediately if you start transforming a more traditional supply chain into a digital supply chain are:

1. A more forward-looking approach

A surprising number of supply chain entities still maintain a largely backward-looking approach. Using a digital supply network, however, will make your supply chain more forward-looking, adaptive and effective owing to greater transparency.

2. Connecting and sharing data resources

The Internet of Things (IoT) has become a vital aspect of a successful, modern supply chain. It is responsible for several improvements in processes, preventive maintenance, and the identification of better ways to move product. However, the IoT relies heavily on the sharing of data, and the digital supply chain can eliminate the current limitations of the IoT exponentially. For example, connected devices in the IoT can create significant business value by delivering data across multiple sites, processes and even organisations.

3. Data-driven plans generated through visualisation

As data becomes readily available, it will be applied to advanced analytics opportunities. Additionally, the use of data visualisation capabilities will make applying data simpler. For example, providing a manager with data from yesterday’s transactions is great, but giving a manager a graph showing what time performance wavered, will go much further in allowing the manager to change today’s operations to prevent the failures of yesterday.

4. Improved collaboration

Since data visualisation tools help make changes in both the digital and physical aspects of the supply chain, internal and external collaboration will be enhanced across all digital platforms.

5. Trust earned from reliability

The relationship aspect of supplier relations should not be underestimated. In the past few years, the number of delinquent invoices (90 days and over) has risen by more than 10%, which often leads to broken relationships and increased supplier turnover. Digitising payments makes it much easier to pay on time, every time – resulting in stronger, more trusting relationships, reduced supplier turnover and few resources wasted on procurement.

The digital transformation of your business can have a significant impact on your organisation – particularly as it applies to your supply chain operations. For instance, a digital supply chain can lower procurement costs by 20%, reduce supply chain process costs by 50%, and increase revenue by 10%, according to a recent research report by the Center for Global Enterprise (CGE).

Read the full CGE report, Digital Supply Chains: A Frontside Flip – Building Competitive Advantage to Optimize Performance and Customer Demand, to gain even more insight into what business leaders have to say about digitising the supply chain.

As technology continues to permeate our personal and professional lives, it’s the companies that make the move to digital sooner rather than later that will stay in the lead. But technology will only deliver the intended positive results if it is implemented with strategy and operations that adhere to best practice in supply chain management. Get the basics right first, because not even the smartest technology can compensate for less-than-best practices.

Read the article, People: The power behind supply chain success, to help you get some of the basics in place.


The TRACC framework helps organisations build standardised and integrated good practice and performance capacity across their Plan, Source, Make and Deliver functions. Simultaneously it accelerates their collaboration and alignment capacity to build world class end-to-end value chains, enabling the organisation itself to become the ultimate source of sustainable competitive advantage.
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