Supply Chain Digitization, Part IV: A Checklist for Success

Achieving supply chain digitization involves a series of steps an organization can take to leverage technology and data to solve supply chain issues and optimize their operations. There are key areas that should be addressed and the following checklist should serve as a starting point to guide the process. 

“In the next three to five years, we will see an increase in the adoption of digital supply chain technologies, as well as technologies that improve human decision-making.” 

The major supply chain issues that have occurred over the last half decade have certainly increased the need for digital supply chain technologies. More specifically, technologies that improve decision-making, reduce human error and decrease supply chain costs. If you’re one of the many organizations who are looking to embark on a supply chain optimization journey, there are some guidelines you should take into account to achieve not just a quick fix–but sustained success for years to come.

In Part III of our “Digital Supply Chain” series, we examined the top supply chain issues and integration barriers preventing you from achieving total supply chain digital transformation, how to get over those hurdles, and how the right platform can be key. For Part IV, we’ll take a look at the steps you can take as an organization to achieve a digital supply chain, a checklist to serve as your starting point, and how the right supply chain technology can help you support your goals for years to come.

Define your goals & areas of improvement

• What do you hope to achieve by optimizing your digital supply chain? 
• What areas do you want to improve upon? 
• Who will benefit in time and money from real-time supply chain visibility? 
• Who do I need buy-in/approval from and who has the budget? 

It’s important to answer these questions before embarking on the process. This is an area we briefly touched upon in Part III: “If you can’t pinpoint what your actual goals are from supply chain digitization, how do you expect it to be a success?” 

The focus of this step should derive from your organization’s strategic direction–as current strategy, pain points, and existing supply chain challenges should all be taken into account. Remember, this first item on the checklist is an iterative one. It’s going to require input and buy-in from people across the organization and continuous refinement in order to uncover the supply chain data you need to move forward. Here are some of the common areas that are often the focus of attention during the digitization process:

• Supply chain visibility
• Inventory management
• Demand forecasting
• Logistics
• Supplier collaboration
• Real-time supply chain analytics & insights

Assess current processes

Once your organization is aligned when it comes to what you hope to achieve, the next step is to take a survey of your existing supply chain processes, systems, and data flows. This will help you identify areas of your network that are inefficient or lack visibility. Through this evaluation you can learn strengths, weaknesses, current gaps, and what your processes are costing you.

To accomplish this, document your current supply chain process steps and assess their efficiency (e.g. orders, shipments). Record the length of time spent to find information, resolve issues, process changes, and identify potential bottlenecks or delays–this will enable you to determine how much your processes are really costing you. For example, how much are you paying in fines due to late or missing documents? How many FTEs are supporting manual intervention or error resolution? If you have two employees responsible for manually searching for EDI documents and data and they cost $250K annually combined, then you’d immediately save that amount per year by digitizing (with the option of re-purposing these resources to focus on higher value IT/business functions). While you’re documenting processes, review your current technology infrastructure and assess its compatibility and scalability for each process. The findings you garner from this step will be invaluable to your organization.

Lastly, identify and ask for buy-in from key stakeholders throughout the organization who are responsible for these processes within your supply chain. Validate your findings and the ROI that implementing a supply chain visibility solution will yield. Gaining information and insights from them is critical for you going forward.

Choose applicable technologies

Now that you’ve identified your goals and know where you will save time and money on optimization, it’s time to select the best-fit digital supply chain visibility software or appropriate technology–and that means doing your homework. You should begin by researching technology and vendors that align with your business objectives and taking steps to ensure the most suitable choice.

To help put things in perspective, supply chain digitization will help your organization achieve a myriad of benefits, including improved supply chain execution, reduced costs, and optimized inventory management. In fact, the average annual cost of not digitizing is over $1M and over $600K to manually enter invoices from suppliers. 

Be sure your technology vendor clearly outlines ROI and how much you can save by digitizing.

If you’re embarking on this digitization journey, odds are you have a traditional supply chain and are likely utilizing a standalone system. However, when you digitize you’re upgrading to multiple technology systems that work together (your new technology + existing system) to eliminate silos, improve collaboration, and create an integrated supply chain. Here are the steps you can take to begin the technology selection process and find your best-fit supply chain solution:

1. Conduct your own market research–understand strengths, gaps, and customer reviews
2. Evaluate supply chain software companies based on industry experience, implementation track record, customer support, integration, and scalability
3. Assess total cost of ownership and ROI
4. Review their partnerships and ecosystem
5. Evaluate user-friendliness and ease of adoption

It can help to leverage external experts or consultants with expertise in supply chain solutions to support your evaluation and selection process.

Ensure data security 

It’s important to evaluate your security protocols and address any supply chain data governance or privacy concerns in preparation for integration with your new technology. Assess where you’re currently at when it comes to encryption, access controls, and system audits. You should also conduct your own audit to determine the quality, availability, and integrity of existing data. According to IBM, the average cost of a data breach in the United States is $9.44M. That’s why it’s crucial to get buy-in from your internal teams as well. Consider educating and training employees on data security best practices to foster a culture of data protection–it’s well worth the investment. 

You should also work to develop comprehensive data governance policies and procedures that outline how data will be handled, stored, accessed, and protected throughout your supply chain. Ensure roles, responsibilities, and accountability for data security are defined throughout your organization and ensure compliance with relevant regulations and industry standards such as GDPR, HIPAA, or ISO 27001.

Monitor & optimize

Once you’re up and running with your new technology, that doesn’t mean the process ends. In fact it’s just beginning. It’s important to continue reviewing the progress of your digitization efforts against the goals you identified earlier in the process. You should continuously assess KPIs, collect feedback from stakeholders across the organization, and make necessary adjustments to your goals and strategies if applicable. A key part of the monitoring and optimization process is leveraging the real-time data from your new technology. Build supply chain dashboards that enable you to gain visibility into key metrics so you can track internal and vendor performance and identify areas for improvement. You should also monitor data related to process efficiency, inventory levels, order fulfillment, customer satisfaction, and other relevant areas.

Remember, this is a general checklist to help you get started on your supply chain digitization journey. Requirements and steps can change based on your supply chain issues, industry, and long-term strategy. Achieving a digital supply chain is an ongoing process. It requires a holistic approach, top down commitment from your organization, and a willingness to adapt and evolve as technology advances.

82% of CEOs in supply-chain-intensive industries plan to increase investments in digital capabilities across their enterprise.

Syncrofy & your supply chain digitization journey

When it comes to achieving supply chain digitization, CoEnterprise and Syncrofy can provide the guidance and visibility to help get you there. What is Syncrofy? It’s a multi-enterprise data platform that enables transparency, intelligence, and automation across your existing supply chain networks. Syncrofy customers have quickly achieved a positive ROI in the following areas: 

• 50% reduction in avoidable fines & fees
• 55% less time spent searching for documents
• 30% reduction in revenue leakage

It stands out from other solutions in the marketplace because it provides you with full supply chain visibility and valuable insights right out of the box by leveraging your existing EDI/ERP applications. There’s nothing to configure, no mapping, or specialized data warehouse required. From the get go, you can see what’s going on across your network, what’s working, and where potential problems may occur. This allows you to be proactive, respond to disruption, and stay on the same page with suppliers.

It’s also designed for everyone in your organization. Syncrofy was created specifically with the non-technical user in mind so there’s no need for data scientists or database administrators. You’re able to see your supply chain as it’s happening in a human-readable, easy to understand format. You’ll also get pre-configured tools to make fast, well-informed decisions on your supply chain that you can’t get with any other platform.

Want to learn more?

To learn how Syncrofy can help you digitize and take back control over your supply chain, click here to watch a recorded demo and to start your FREE trial today!