There are many interpretations of digitization of supply chain. In our view, digitization implies systems having the capability to collect data, understand the implications of data and each event, and finally find the best possible solution in a timely manner. The results can then be shared with the end users in many forms including cell phones, natural languages or simply personalized reports and alerts.
For a supply chain planning system to be able to do this, it must have certain capabilities described below. In the absence of such attributes, the end users will have to finish the job manually which may cause a lot of inefficiencies of trying to execute a plan that is really not a good plan: either not accurate, too late to be produced or too high level! Almost all S&OP solutions fall in this category. That is why in today’s S&OP systems, so much what-if modeling is needed and a lot of user interjection is required to make the plan executable! And even then, it is not an optimized plan! It is merely a doable plan that is short of the best service level and lowest cost of operations.
At Adexa, we have designed a Digital Blueprint© for the entire foot print of Supply Chain Planning both horizontally and vertically. A digital Blueprint allows incremental addition of technology in a unified data model as more data becomes available and more accurate models are made until the highest level of supply chain maturity (according to Gartner) is achieved. To this end, our clients are enjoying results such as 30% less shortages and up to 20% increase in delivery performance almost immediately after the system has gone live. These are the kind of benefits that one would obtain due to much higher accuracy of plans, leading to almost 100% service level and much lower inventory and cost of operations in some of the most complex supply chains.
Here are some of the reasons why:
As you can see digitization is a lot more than getting your reports on a cell phone or a tablet. What we have outlined above describes some of the basic ingredients of accomplishing what Gartner refers to as Level 5 maturity in the supply chain or algorithmic supply chain. It enables not only accuracy & optimization of plans and automation but also goes beyond to self-improvement of your supply chain on an on-going basis, an intelligent system, digitized.