Digitalisation, dashboards, data, and skills are key to improving the resilience of your supply chain in the current environment.
Author: Rowan Austin, Head of Trade Origination & Advisory, NatWest Group
“Leveraging new technologies to map supply chains and draw on data-driven insight can lead to lower risk, reduced costs, stronger supplier relationships, making trade more efficient”
Knowing and understanding your supply chain comes with a wealth of opportunities to remain competitive. Leveraging new technologies to map supply chains and draw on data-driven insight can lead to lower risk, reduced costs, stronger supplier relationships, making trade more efficient.
The benefits of trade digitalisation
Better supply chain mapping requires investment, and embracing the right IT infrastructure and software is essential.
There’s more to it than just new technologies, of course. Businesses also need the right mix of skills – people laser-focused not just on developing and executing procurement strategies, but on tracking and responding to disruption, identifying threats and inefficiencies before they emerge, and proactively engaging with suppliers, regulators, and other stakeholders.
But the combination of new skills and technologies has never been more important given the scale of disruption businesses have faced over the best part of the past decade. Get that combination right and the potential benefits are vast. Firms will be better placed to:
- Pinpoint weaknesses and vulnerabilities, such as the need for a new supplier, or reallocate of resources within part of the chain to improve cost or time efficiencies.
- Develop a better understanding of risk, process, and practices, staying on top of regulations or potential challenges. This can also reinforce legal, regulatory and contractual responsibilities to protect against cyber security risks.
- Spot disruption, such as a supplier likely to be affected by economic fluctuations like high interest rates or financial pressure, or geopolitical risks leading to rising energy costs or restricting access to raw materials.
- Track customer engagement – translating customer demand and supply more accurately and quickly between suppliers, buyers and third parties, particularly in demand-led sectors.
Leveraging date for improved decision-making
Digital dashboards can create oversight across a web of suppliers, providing information by priority of importance. Shifting supply considerations and bottlenecks can be accessed and assessed in real-time or near real-time, allowing more informed decision-making. This frees up time previously taken up by the routine tasks of manual data input and management.
Embracing AI for supply chain planning
Emerging technologies and platforms that leverage artificial intelligence (AI) are able to sort and streamline incoming data from various sources, devices, and applications to aid supply chain planning. This could extend from processing operational insight from LIDAR and RFID tags to GPS and machinery sensors, all lending towards more accurate planning – from source management to end-product delivery.
New tools can help businesses to spot disruption and make timely decisions when faced with a variety of challenges, including geopolitical turmoil, severe weather changes, warehouse and inventory management and failing machinery.
By integrating new sources of data or platforms with real-time visibility, it can analyse trends and make more accurate forecasts, optimising production and inventory, and suggesting logistics solutions.
Upskilling staff in line with digitalisation
Digital technologies alone won’t help unleash supply chain resilience. It’s important to focus on acquiring and developing the skills fit for managing tomorrow’s supply chain today.
Businesses today need to get in front of digital transformation by embedding up-skilling strategies and nurturing digital supply chain talent. The companies that do this most effectively introduce skills-building programmes that focus on building foundational, end-to-end digital supply chain knowledge and capabilities that incorporate their business’s unique requirements and objectives.
Towards a more digital future
The risks businesses face today makes the need to digitalise supply chains all the more urgent. Yet, end-to-end supply chain visibility is about more than just risk management. It can have a dramatic influence on the bottom line by creating new efficiencies, fostering higher quality engagement with suppliers, and enabling your business to redistribute funds to more profitable projects.
Visit natwest.com/business/insights.htm to find out more about how to get ahead of the latest trends in trade and supply chain management.
