Guest Post

The Age of Digitalization and Its Positive Impact When Improving Supply Chains

Today’s global supply chain has seen no shortage of challenges in recent years. Whether it be pandemic-driven backlogs, supply shortages, natural disasters, or geopolitical uncertainty, the list of potential disruptions seems to grow by the day. And yet, despite all these challenges, the supply chain has become more globalized, interconnected, and streamlined than ever before.

The supply chain has been able to weather these storms due to the ongoing digital transformation that has been taking place across the board. By digitizing various aspects of the supply chain, from order management and tracking to transportation and logistics, businesses have made their operations more agile and responsive to change.

Supply Chain Digitalization – What’s It All About?

Supply chain digitalization is using digital technologies to improve the efficiency and effectiveness of supply chain management. Digitalization can do this in several ways, but some common examples include the following:

Automating manual processes: Businesses can reduce errors and boost efficiency by digitizing manual processes like order entry and invoicing. The ability to track orders and shipments in real time also helps improve coordination between different supply chain partners while reducing the need for paper-based documentation.

Providing better visibility and traceability: Thanks to digital tracking technologies, businesses can now get a much more detailed view of their supply chain. This allows them to identify potential bottlenecks and issues before they cause significant disruptions. It also makes it easier to trace the source of problems if and when they occur.

Enhancing coordination and collaboration: Using digital tools like enterprise resource planning (ERP) systems and supplier relationship management (SRM) platforms can help improve coordination between different supply chain partners. This, in turn, can help to reduce the risk of disruptions and improve overall efficiency.

Improving forecasting and planning: By collecting and analyzing data from across the supply chain, businesses can better understand trends and patterns. Historical trends can then use this information to improve forecasting accuracy and make more informed decisions about planning and inventory management.

As supply chains become increasingly complex, the need for digitalization will only grow. By using the latest technologies, businesses can improve their operations and create a more resilient supply chain better equipped to withstand the challenges of the modern world.

What Types of Supply Chain Technologies Are Driving Real Change?

As businesses look for better, more improved ways of doing things, several different technologies have emerged as key drivers of change within the supply chain.

IoT Sensors and Tracking

The internet of things, or IoT, is a system of interconnected devices that share data and information. The benefits of the IoT are far-reaching and profound, with applications in nearly every industry imaginable. One area where the IoT is particularly valuable is supply chain management. By equipping devices with sensors and tracking capabilities, businesses can gain greater visibility into their supply chains and make more informed decisions that improve efficiency and optimize resources.

One significant benefit of IoT sensors and tracking in supply chains is inventory monitoring. Traditional inventory management systems require manual input from employees to update records, which can lead to inaccuracies and errors. With IoT-enabled tracking, businesses can automatically capture inventory levels and location data, ensuring that records are always accurate and up-to-date. This data can inform decisions on reordering stock, reducing the chances of stockouts, and maximizing efficiency.

Blockchain Technology

At its core, blockchain is a distributed database that allows for secure, transparent, and tamper-proof record-keeping. This makes it an ideal tool for tracking goods and materials as they move through a supply chain. By integrating blockchain into their operations, businesses can enjoy significant advantages in terms of transparency, traceability, and efficiency.

One of the most significant advantages of using blockchain is that it can help to streamline supply chain processes. Because all transactions are recorded on a distributed ledger, there is no need for paper records or manual data entry. This not only saves time but also reduces the chances of errors. In addition, because all participants have access to the same data, there is no need for duplicate records or manual reconciliation. 

Artificial Intelligence (AI)

Artificial intelligence (AI) is another technology starting to impact supply chain management significantly. AI-powered applications can automate several tasks, from route planning and warehouse management to demand forecasts. When combined with other technologies, such as the IoT and blockchain, AI can help businesses take their supply chains to the next level.

Predictive analytics is one of AI’s most exciting applications in supply chains. By analyzing data from across the supply chain, businesses can identify patterns and trends that can be used to forecast future demand. This information can then be used to improve forecasting accuracy and make more informed decisions about planning and inventory management.

The Future of Supply Chain and Digitalization

As supply chains become increasingly complex, the need for digitalization will only grow. By using the latest technologies, businesses can improve their operations and create a more resilient supply chain better equipped to withstand the challenges of the modern world.


Author Bio:

David L. Buss

David is CEO of DB Schenker USA, a 150 year old leading global freight forwarder and 3PL provider. David Buss is responsible for all P&L aspects in the United States, which is made up of over 7,000 employees located throughout 39 forwarding locations and 55 logistics centers.

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