Supply chain incapabilities cost retailers $1 Trillion loss each year. Digitization in sales, marketing, and customer service is common, but with the supply chain, there is a lag. McKinsey reports that an average digital transformation shift of the supply chain is 43%.
The COVID-19 has disrupted the retail industry making businesses realize the importance of the supply chain in running successful retail or an eCommerce store. The globalization and complexity of supply chains can’t be maintained with disconnected and outdated manual processes. The McKinsey report shared above indicates that companies that sharply digitize their supply chain experience annual growth of 2.3%.
The grandest risk in the supply chain is caused due to delay in delivery, communication gap, and supplier ineffectiveness that can affect customer experience. From sourcing the raw material to transit, delivery, and accepting the finished goods into the brand warehouse. Implementing a digital SRM solution is one way to get started quickly.
What Is Supplier Relationship Management (SRM) And Why Do You Need it??
A supplier relationship management system provides tools for managing and optimizing your supplier relationships; in the same way, a customer relationship management system enhances your relationships with customers.
Globally, business leaders are increasingly focusing on SRM. A Deloitte 2020 survey found that supplier collaboration and improving supplier relationships are among the top five priorities for the next 12 months.
By combining real-time data with automation, collaboration, and planning capabilities, SRM software allows you to determine the impact of each component on the overall supply chain.
You can save time, money, and resources by digitizing your processes with SRM; providing you with the following benefits:
1. Enhanced Collaboration
A digital supply chain allows the internal & external teams to work seamlessly together. If your supply chain is in emails, spreadsheets, and documents, it’s challenging to collaborate. When stakeholders, team members, and top management can access data in real-time, well-informed decisions can efficiently be executed without any bottlenecks.
2. Full Visibility
Using SRM, you can monitor the entire production process, flag any potential challenges, set up a real-time feedback loop, and check-in with suppliers in real-time. Businesses focus their efforts on improving the efficiency of the last mile, delivering products to customers’ doorsteps, but the first mile is just as crucial. You can align your teams and prevent problems before they arise with complete visibility into production.
3. Predictable Automation
The goal of supply chain management is to ease the life of your employees.
Automating repetitive tasks and eliminating inefficiencies improves team performance, reduces costs, and increases employee satisfaction. You can centralize supply chain data and give everyone access to it instead of letting one or two people be responsible for the different spreadsheets. Your team will have more time to focus on higher-value activities to provide excellent customer service. By doing so, results will become more predictable, there will be a single source of truth, and results will be more predictable.
4. Making Processes Scalable
SRM can help your team create a clear, repeatable set of processes that they can follow and adjust as your organization grows. Your supplier relationships are visible in a unified view, giving you insight into what works well and where you need to optimize.
In the coming years, digitizing your supply chain can offer competitive advantages to your company while allowing your business to be more flexible.
Security Risks for Supply Chain
Research by Ponemon Institute indicates that 56% of the organizations reported a breach in their supply chain from third-party vendors. As businesses are moving towards digitization of the supply chain there are imminent dangers of cyberattacks that must be addressed. The supply chain is the backbone of any business, and one broken link can have a ripple effect on all the other involved suppliers, potentially endangering the entire operation.
As part of reducing threats and minimizing risks, organizations should verify the security practices and procedures of third-party suppliers, vendors, and partners.
Future-proofing your supply chain is the only way for sustainable growth for the future. Cooperative Computing can help you digitize your processes.