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How virtualizing supply chains is addressing 2020’s top 5 challenges for executives, and adding millions to bottom line

2020 has seen the expedited harmonization of the physical supply chain with digital identities. There was a lot said and written about the importance of this mission. Now that companies have jumped into implementation mode, we polled a group of Directors, VPs, and C-level supply chain executives–did you make the right decision, and what are the early signs of impact?

The results are in.

Here are our 5 most important takeaways from the results of the poll answered in 1st person

1.     Moving teams to digital workflows was easier than I imagined, and time to value was quicker than I expected.

This answer was vastly different, depending on the choice of software. Where non-ERP digital solutions with faster time to implement were chosen, the responses were more resoundingly positive.

2.    We have witnessed quick productivity gains across varied job functions by moving daily tasks onto digitized and automated software features.

 3.     We see improvement in margins as a function of virtualizing and optimizing bid management, and supplier assignments; improvements due to real-time visibility connecting upstream and downstream/supply and demand streams of supply chains; margin improvements due to integrating existing systems with sales data to our new digital supply chain systems; reduction in costs due to digitizing creation of assets like purchase orders, BOMs, spec sheets and other assets; margin improvements with better forecasting and less $$s in inventory.

We summarized five areas in answer to this question: margin improvements were seen as a result of investing in digital systems. Each executive listed margin improvements seen in 1 to 4 areas. No single executed listed improvements in all 5.

 4.     We see improvement in our speed to market and a lagging but a measurable boost to revenue attributable to our faster supply chain times.

 5.     We see a perceivable, positive cultural impact in improvement in communication and collaboration across different skillsets and our teams across the world.

This was a question with a yes/no answer. 100% of survey respondents that invested in digital supply chain systems answered yes to this question.

On the negative, despite all the optimistic voices encouraging the need to digitize, we still got the following responses from 14% of respondents

1)    Our spending is completely frozen. Not the right time for us to discuss new systems internally.

2)    We had made big investments into a set of heavy systems in previous years. We need to focus on those ongoing implementations, no time for any more.

In summary, reasons to celebrate innovation and some status quo despair.

Based on our research and data collected from our own customer use cases, with even a 2.5% improvement in gross margins, 5% improvement in lead time, and with 15% of manual tasks digitized, companies can create up to $2.5M in additional value for every $10M in revenue, as a combination of savings in cost, and new sales. 

The results back the movement. The time to digitize supply chains is now.

Listen to Suuchi’s supply chain insights for businesses across the globe.

Written by Suuchi Ramesh

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