Supply Chain Digitalization Is Top of Mind for Many Manufacturers – Are You One of Them?

The world is changing constantly and quickly. Digital technologies and their related information flows continue to disrupt industries – creating new opportunities for customer service, revenue streams, efficiencies, and competitive advantage. Those that once viewed Amazon’s wild success as primarily a retail concern have now reconsidered, and if they want to be successful, re-positioned.

Amazon has raised the bar with regard to customer service, and now many business-to-business (B2B) companies expect the same service levels as today’s consumers. How manufacturers are responding to this “Amazon effect” is a prevalent theme heard from the respondents of JDA’s 2018 Intelligent Manufacturing survey, which will be announced tomorrow. We offer a preview of the results today on our blog.

The survey findings suggest that manufacturers are embracing a new retail-like role, with many investing in the following supply chain technologies to keep up with changing customer demands: inventory optimization solutions (43 percent), integrating planning and execution technologies (41 percent), warehouse automation (39 percent), inventory allocation and reliable promising (37 percent), and customer segmentation (23 percent).

Preparing their supply chains to be more responsive and meet rapidly changing consumer behaviors was a key point for respondents. They are planning to achieve this by focusing on several strategies such as enabling internal and external collaboration (51 percent), improving forecasting with demand sensing (44 percent), and by leveraging data science for forecasting insights (33 percent). Additionally, nearly a third (31 percent) are integrating sales and operations planning (S&OP) with sales and operations execution (S&OE) through a single, connected technology accessed by users across the supply chain. This data is reinforcing what we are hearing from the market that companies need an accelerated “closed-loop” capability between planning and execution.

Even though 70 percent of the survey respondents say supply chain digitalization is currently a major initiative or will be one within 12 months, only 35 percent of respondents expect that their company will be running a fully integrated digital supply chain within the next 2-3 years. This discrepancy indicates that for many manufacturers, while they see the value and the opportunity, the path to digital supply chain maturity is still unclear. For companies that are seeking to innovate and compete, and need help developing a digital supply chain roadmap, JDA can help. A good first step is to understand where you are from a supply chain maturity perspective, and then plot a journey map that is aligned to your business objectives and greatest areas of opportunity.

JDA collected responses for the 2018 Intelligent Manufacturing survey from 271 U.S.-based professionals across manufacturing and wholesale/distribution industries in February 2018 via a third-party research partner. Stay tuned tomorrow for the full results.

There is much value to be gained from supply chain digitalization, and it’s time for manufacturers to invest in the future, or risk getting left behind. For additional information on how to make the pivot to digital transformation, download JDA’s white paper on how digital technologies will be key to manufacturers’ future success.

  2 Comments   Comment

  1. Digitization is more than a shift in technology – it’s a shift in mindset, encompassing end-to-end digitization and data integration of every aspect of the value chain. It is critical to virtually every company, particularly to manufacturers

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  2. I got some good stats from the article; thanks. But I don’t think supply chain digitalization is not only limited to inventory optimization solutions, integration of planning and execution technologies, warehouse automation, inventory allocation & reliable promising, and customer segmentation. Rather than this, many companies who have a clear plan of where to apply digital technologies are trying out various innovate ideas using edge computing, VR, AR, RPA, Immersive technologies, blockchain, IIoT etc. It’s great to see the industrialists’ efforts to solve many tedious processes using automation and associated technologies. Incorporation of latest technologies to the business could facilitate cost reduction, better decision making, save time, improves productivity, better customer experience, high quality products & services, and overall better business profit. It is expected that by 2022, up to 90% among the global supply chain will be fully digitalized. It’s a cool thing, right?

    A recent study reveals that almost 94% of supply chain leaders believe that digitalization will transform supply chain industry tremendously by the end of 2018 and among them only 44% have digitalization plans to be extended in 2019. It indicates that the rest don’t even have any plan! It’s definitely a great thing that JDA could help supply chains to design their digital supply chain roadmap. I appreciate that! Keep going JDA.

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