The Shape of Supply Chains in the Digital Economy

In 2020, we learned just how valuable—and fragile—supply chains can be. As the global economy becomes increasingly digital and strategic, supply chains are being reimagined: more onshoring, more sources of supply, more data, and more need for data-sharing, more demanding requirements from customers, and more complexity requiring modern, purpose-built solutions.

On top of all those new expectations of and requirements for modern supply chains, they’re also becoming interconnected with a dizzying array of new technologies. Check out this partial list from a recent supplychaingamechanger.com article:

• The Internet of Things (IoT)
• End-to-End Digital Connectivity
• Cloud Computing
• Blockchain
• Big Data
• Artificial Intelligence
• Predictive Analytics
• Machine Learning
• Virtual Reality
• Augmented Reality
• Voice-Activated Technology
• Wearable Devices
• Control Towers
• Robotics
• 3D Printing and On-Demand, Additive Manufacturing
• Cyber Security
• Autonomous Vehicles
• Drones
• Software as a Service (SaaS)
• And much more.

(Thanks again to supplychaingamechanger.com for that excellent list!)

Smart devices and the supply chain

Let’s push even further with this new view of what supply chains are all about. Many offices have copier/printer machines, and it seems that most of them typically have a button flashing saying “Service Required!” or “Low on Toner!” So instead of going on an excursion to find toner, or sending an alert to a technician who can log into a system and look up the part and go through the process of ordering it, why not have the brainy copier shoot off an order to the supplier?

And as ERP systems become more intelligent, they can understand when it’s helpful to send out digital alerts to relevant members of your team or digital workflow updates on what tasks have been achieved and what remains to be done. (ECI calls this new type of solution business activity monitoring.)

How about medications—will intelligent containers begin to insert themselves into the supply-chain dynamics? Indeed, that’s already happening.

Thank about that next-generation term of “internet of everything” that was the follow-up to IoT: it’s not at all as far-fetched as it sounds. And the accelerated evolution of intelligent processes and automation that’s touched every facet of our lives in the past 15 months will only accelerate the arrival of a new type of digital supply chain that’s unlike anything we’ve ever seen before.

Companies are becoming more interconnected internally

And the situation inside of companies is changing just as rapidly and just as dramatically. Linear and rigidly departmentalized operations give way to seamless processes that interconnect and often integrate what had been starkly separate organizations with little or no visibility into upstream or downstream operations.

In today’s always-on and highly customized world, designers meet with customers who talk to engineers who work with procurement specialists in constant touch with logistics teams who meet daily with marketing to analyze sales forecasts and pipeline projections with essential input from service, manufacturing, and warehousing. The single point of contact for the supply chains of the past is becoming, in today’s times, the single point of failure because end-to-end visibility and interconnectedness are critical to meet the needs of the high-volume and high-velocity digital economy.

Do you think your good ol’ inflexible and hard-headed ERP system of 20 years ago could handle that? Heck, of 10 years ago? Even three years ago?

Modern ERPs enable the digital supply chain

The modern world will be dependent on and run by modern, modular, flexible, and nimble ERP systems built for the cloud, engineered for speed, and capable of handling complex combinations that were unfathomable a decade ago.

• In the finance department, that means the books can be closed more quickly and with more confidence, allowing leaders to allocate resources more effectively and rapidly.
• In manufacturing, modern ERP systems are synchronizing the flow of material, optimally scheduling essential workers, and helping ensure greater levels of safety and compliance on the shop floor.
• In procurement, reconfigured supply chains managed by modern ERP systems are lowering risk, boosting efficiency, and often reducing costs.
• In shipping and fulfillment, these new end-to-end ERP systems delight customers by allowing them to set up highly detailed and customized shipping plans to match the escalating needs of their customers.

This is how business needs to be done in the digital economy. These new capabilities of modern ERP systems have become an indispensable solution in our fast-paced and data-driven world.