Boost supply chain resilience with digitalisation today

How does digitalisation affect supply chain resilience?

According to this McKinsey study, companies that have implemented digital dashboards were twice as likely as others to avoid supply chain problems caused by the disruptions of early 2022.

It is a critical challenge for modern businesses and one that gives digital transformation a key role for supply chain resilience. By using multiple digital data-driven avenues, a balance can be achieved by enabling responsive supply chain practices to track progress and continue to deliver excellent service to customers.

How can digital resilience be achieved?

Here are a few ways to consider achieving supply chain resilience via digital tools:

• Decision-making and data: Access to real-time data has proven to be valuable to optimising operations in the supply chain. Digital tools like sensors and advanced analytics are equipped to provide real-time visibility into the supply chain. This means organisations can respond quickly, minimising risk and optimising for supply chain resilience. Data tools also provide analysis of trends that can anticipate potential disruptions and take proactive measures, such as adjusting inventory levels and reducing the impact of reactive decisions.
• Optimised resource management: AI-driven tools can optimise asset allocation, ensuring that materials are used efficiently, and waste is minimised. Machine learning algorithms can optimise production schedules by using route optimisation software, transportation routes can be modified to boost supply chain resilience while maintaining delivery timelines. This is crucial for resilience when alternative routes may be needed.
• Supplier Collaboration and Risk Management: A McKinsey 2022 survey reports that “while companies have made radical changes in the way they use technology to manage their supply chains over the past two years, the development of their supply chain risk management capabilities has been much more incremental. Over the past 12 months, two-thirds of companies have implemented new supply chain risk management practices; among the most popular approaches are new processes to monitor supplier-related risks.” Digital technology has become popular in implementing risk management strategies such as using platforms for real-time collaboration with suppliers that can help in quickly addressing disruptions. These tools are also being used to coordinate the use of materials during a supply chain disruption and to assess and monitor the risks associated with suppliers. This allows businesses to select partners who contribute to supply chain resilience.
• Predictive intelligence: Automated and advanced technology systems are proving to be essential. Data prediction tools improve demand forecasting accuracy, reducing the need for excess inventory that might otherwise lead to waste. This helps maintain resilience by ensuring that only the necessary resources are produced and stored.

By leveraging these digital transformation strategies, building a future for supply chain resilience is not only possible but a necessity. The key is to integrate these technologies and practices into the overall supply chain strategy, ensuring that resilience is treated as a complementary goal and a continuous learning process. Keeping updated on new technology, implementing feedback loops and investing in expertise can go a long way in ensuring organisational goals are met.

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