Is every supply chain really a digital supply chain?

Without hesitation I can say that most of the companies have already become DIGITAL. There is practically no more companies, which would not have their own processes supported by digital computer tools. But I can NOT say that all of the supply chains are already digital supply chains.

Most companies have successfully digitally supported their own processes by now, but at that point the digitalization of their business has usually come to an end. Rarely any company has connected their business tightly and digitally enough to the businesses of their suppliers and customers, so they could be successful in the environment of the 4th industrial revolution.

They still have the same old perspectives and processes, which are only modified and supported by digital tools. If anything, they exchange orders documents through Electronic Data Interface. Here the process usually ends. The actual work order is still being inputted in the system by an employee.

Supply chains are still managed by people and there is still MUCH room for improvement.

There is much room for innovation and optimization of supply chains opened in the area of interconnecting the information systems and in the area of automatic flexibility of the supply processes, based on the actual or predicted consumption of the final consumers. Supply chains can now be completely digitized!

The activities of highly optimized and interconnected supply chain can be envisioned in a way where the order is processed only when there is an actual customer requirement. Therefore if the shelf at the store is emptied by a customers, a minimal quantity of that product is ordered, just in time when that happens. Not before, since the stores don’t have space for extra inventory and not after, since the consumers hate when they can’t find the wanted product on the shelf. An order for new shipment of missing products must happen automatically and without the intervention of any employee.

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That kind of digitalization of the supply chain could not be carried out unless we reach the following goals:

  • Interconnected supply chain (exchange of all the data between all subjects, from beginning to the end)
  • Intelligent supply chain (collecting all data, predicting future events)
  • Scalable supply chain (ready for future growth)
  • Fast supply chain (without manual confirmations, without waiting)

Sounds easy but think again! Some say that ordering small quantities is not in the retailer’s and supplier’s best interest. This is only true if the logistics at the company is not being organized efficiently. Take a look at the Müller drug stores for an example of how they fill up their shelves. Sometimes they only get one piece of a product delivered to the store – just enough to fill up the shelf and reach the predicted number of products on that shelf. But they don’t only get delivered that one product at the time, all the missing products for the whole store are delivered at one daily shipment. Every single day.

What can Spica offer to your company in this field? We can make sure that your information system collects the right data about real time events through automatic identification of all the events in the supply chain; we arrange sending work instructions straight to the devices of all operators – in the warehouses, stores, distribution and manufacturing. The instructions can even be given through headphones.

One more thing: if we only support the current processes digitally, we didn’t do much. Processes in the modern and DIGITAL supply chain must be build up from scratch and efficiently take all the advantage of the digital world opportunities.

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Being part of Spica management team for more than 15 years, Andrej Planina is considered a leading regional expert in the field of business mobile solutions and technologies for automatic identification. He obtained extensive knowledge working as a project manager for major organizations in the region. Well aware of the business aspects in information processes, Andrej is the author of some of Spica’s successful products. An award-winner for the best innovation for the "Intelligent safety control system“, he is regularly invited to share his knowledge as the lecturer at the University of Ljubljana (Faculty of Engineering and Computer Science, Faculty of Economics). When not working for Špica, he is a passionate wine taster and blogger. Find out more at : http://vinskezgodbe.blogspot.com.