The events of the past year propelled organisations’ digital transformation vertically. This giant leap forward is founded on the use of technology and innovation, especially in procurement departments which are facing the demands of a volatile, threatening, changing and highly discerning market.
While many supply chain professionals do have extensive knowledge of the tools available to them, there is still a large percentage unfamiliar with the new technologies being used and the critical elements for designing a Supply Chain 4.0.
The sharing of experience by relevant stakeholders or those who have been successful in this challenge is essential to the development of the industry as a whole. It is projected that the potential impact of Supply Chain 4.0 in the next two or three years will be huge: up to 30% lower operational costs and a 75% reduction in lost sales.
Achilles took part in the Supply Chain 4.0 Forum both to contribute its experience and as a strategic partner for leading organisations in this transformation. This was an online event for specialists and leading professionals to discuss the impact of technology and digital transformation on the supply chain. On the day, Katie Tamblin, Chief Product Officer at Achilles, analysed the advantages of the technology used to reduce risks in the sector: for instance minimising risks, increasing resilience and accelerating recovery.
What is needed to build a supply chain that reflects the times and meets the demands of the market?
Critical elements for a Supply Chain 4.0
As Supply Chain 4.0 involves the implementation of new technologies to boost the efficiency of the supply chain in its entirety, digitalisation and the correct use of data is obviously central to this transformation. But what are the critical elements for it to be implemented correctly?
Below are some of the key recommendations discussed during the event:
Increase innovation in digitalisation in logistics companies. This requires a better understanding of digital solutions appropriate to the needs of the sector: Blockchain, Internet of Things, big data analysis, robotics and automation, etc.
Map the latest technological solutions used in the sector and their application.
Estimate the magnitude for the economic impact of each of these technological solutions and identify the organisation’s capacity for their implementation.
In any case, digital transformation requires extraordinary technical, financial and human capital capability. Because whichever tool is to be implemented, the information collected needs to be accessed and analysed in order to optimise strategic decision-making, among other things.
Data is central to supply chain operations
The implementation of a Supply Chain 4.0 helps reduce risks, but does not avoid them. There needs to be access to data-based knowledge to improve strategic decision-making and therefore manage risk.
“Unknown players in the supply chain represent a significant risk. Visibility and the use of predictive data improve the resilience of organisations,” emphasised Katie Tamblin in her presentation during the event.
A good example of the negative impact of a lack of visibility is British Airways. The airline was fined €26 million by the ICO (Information Commissioner’s Office) after its customers’ personal and financial details were stolen. One of the biggest fines for this type of breach. The cyber theft was made possible by weaknesses in the security systems of one of its suppliers, Swissport. As well as the fine, the ICO issued recommendations for the implementation of processes to reduce risks in the supply chain.
The cost of doing nothing continues to grow as we have seen previously. These days, for supply chain professionals, tools such as supplier scoring, performance feedback and insights, among other things, based on reliable and timely information, are essential.
At Achilles, we help you assess the risk of your suppliers by capturing and analysing data, which involves areas such as sustainability and cyber security. We have supported leading organisations in a variety of sectors in this task using technology and business intelligence.
Contact us to find out more about our experience in the market and the solutions we have available for your organisation.