The Leading Role Supply Chain Plays in Business Transformation

It is not news that digital technology and the “age” of information will change dramatically how we do business in the world. In other words, business as usual will change, and the companies that don´t follow this new path will probably fail in a medium-long term perspective. Therefore, supply chains play a key and critical role in business transformation and adaptability.

The global supply chain can positively benefit by applying digital technology disruptions like Blockchain, the Internet of Things (IoT), Electrification, autonomous vehicles Artificial Intelligence (AI), and Machine learning. All of these are technologies that will reach a high level of maturity and economic feasibility in a few years. All these tools combined will make it possible to improve speed and accuracy in supply chain decisions, hence making businesses more profitable to shareholders, employees, suppliers, and main stakeholders.

Current Role: There is no doubt that the supply chain plays a critical role to keep the business healthy, and helping to drive and make decisions according to the market and operational balance. The focus till now was it being a sole function and very technical discipline. This vision of the supply chain, expanding beyond its current role, is supported by people with deep technical knowledge.

The Role of the Future Supply Chain: It is fair enough to believe that the supply chain will assume an important role in this environment. 

This probably will be one of the areas that will help to lead the business disruption and transformational process. Assuming that role, the leadership capabilities of supply chain experts will be important. Engaging and influencing interfaces among the value chain will be the key to success and a more integrated, reduced, and horizontal decision-making organizational structure.

Cross-functional & Matrixial Capabilities: Looking ahead to the future seems that supply chain leaders should be involved in much more than sales and operational planning (S&OP) and/or logistics and industrial capacity critical analysis. New integrated concepts should be developed and created on top of usual ones like safety inventory. The physical presence on the field and understanding of customer needs is another task to be done by the supply chain team. Working collaboratively with sales and marketing will make a huge difference in operational approach, industrial setup, and suppliers’ optimization.

"Engaging and influencing interfaces among value chains will be the key to success and the more integrated, reduced, and horizontal decisionmaking organizational structure"

Real-time Information as a Game Changer for Supply Chain: In this new world, real-time information and quick and deep analysis will be more accurate and visible, making it possible to choose different scenarios and approaches from a supply chain perspective. This tool will support adjustment by the chain to deliver exactly what the customer and consumers want. Another benefit will be the reduction of inventory levels and lead time. More than feeling and analyzing market trends, the new environment of the industry will prescribe what exactly is required. Lower inventory and integrated chains from customer to suppliers will reduce cost, leverage results, and still provide better delivery lead time than ever.

Search for Lifelong Learning and Develop Capabilities: At the end of the day, what we could easily assume is that the role of the supply chain will change. Therefore, the supply team should develop new capabilities and search for new knowledge to help and drive the business transformation process.

Adopting resilience, self-knowledge, and a business[1]oriented attitude will enable the supply chain team to change the game for the possible future for supply chain enthusiasts.