These days, executives recognize a huge gap between where they are digitally transforming their global supply chains and what they expect in just five years. This is one of the conclusions drawn from a global study entitled "The Current and Future State of Digital Supply Chain Transformation), conducted by Capgemini Consulting and GT Nexus, an Infor company, a provider of market-specific enterprise applications built for the cloud.
So far, most research conducted on the topic has examined digital transformation within organizations or between them and their customers. This new survey is the first to explore the current and future condition of digital transformation, mainly encompassing companies and their partners throughout the chain.
The study analyzed 337 executives from some of the largest global manufacturing and retail companies across Europe and North America. The main conclusions of the study include:
The digital transformation of the supply chain is important
· 75% of respondents consider supply chain digital transformation "important"
· 50% stated that digital transformation is "very important"
· 70% have already formally started the digital transformation from the supply chain
So far, progress has been slow
· More than 30% of respondents said they were "dissatisfied" with the progress so far
· Just 5% are "very satisfied"
Essential technology resources already exist, but are not yet widely used
Some platforms and tools have been identified by executives as enabling digital transformation, however many are still supported by outdated technologies:
· Chain Visibility Platforms/Tools (94%), Big Data Analytics (90%), Simulation Tools (81%) and Cloud (80%) are seen as the technological resources that facilitate the digital transformation of the chain.
· But, 48% of respondents admit that "traditional methods" such as telephone, fax and e-mail are still the main ways to interact with supply chain partners nowadays.
Dramatic changes are expected in just five years
· Today only 15% of respondents say that most extended chain data is accessible to your organization. In five years, this number increases to 54%.
· Furthermore, only 23% of respondents say that the most of the extended chain data is analyzed and used for decision making. In five years, this number will grow to 68%.
· Within five years, 95% of respondents expect that more processes with suppliers are automated and 94% expect to receive more real-time chain-wide status updates.
Some of the expected benefits include cost reductions for logistics, inventory and maintenance, improvements in customer service and greater equipment efficiency on a global scale. Even more importantly, the digital transformation of the supply chain is expected to dramatically increase enterprise agility. Speed is needed to respond to changing market conditions, new entrants that can threaten existing business models, or unexpected supply chain disruptions that have caused significant damage to the financial performance and reputation of countless organizations over the years.
Softening the impacts of these unforeseen events has become a priority and one of the main drivers of the need to carry out a digital transformation. However, according to the study, current levels of collaboration and visibility across the network are still low, which limits agility.
"75% of respondents say that the supply chain digital transformation is important, but there is a big gap between where companies are today and where they expect to be in just five years", said Mathieu Dougados, senior vice president of Capgemini Consulting. "Digital transformation initiatives within the four walls of organizations represent great challenges for themselves. But in today's globalized and outsourced world, digital transformation can only be successful if companies approach it with a holistic view of the entire chain, which can include hundreds of partners. Therefore, connectivity between partners, cross access to data and the use of analytics across the network become the main areas of focus”, pondered Dougados.
"The digital transformation of the supply chain is an important initiative that requires leadership, C-level vision and a holistic approach to change that promotes automation, connectivity, data sharing and collaboration across the chain," said Kurt Cavano, President of GT Nexus . "This survey showed that manufacturers and retailers have a clear idea of where they need to be and which digital technologies will help them get there over the next five years."
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