How Is Digital Transformation Revolutionizing The Supply Chain Industry?

Digital transformation is harbingering in a new era of supply chain management where customers & suppliers are bonding in unique ways, hazing the lines between the digital & physical world obliterating the organizational boundaries.

Digital transformation is an inevitable revolution, shaped by various technological disruptions, including Big Data, 3D printing, AI, AR, and interaction between machine and human. By digitizing the supply chain, the $1 Trillion deficiencies in sales can be prevented. 

Organizations need to focus on risk mitigation and enhanced resiliency following the pandemic’s disruptive impact on global supply chains. Companies that use digital technology and improve real-time visibility can identify & eliminate problems before they occur or respond more quickly to disruptions when they happen.

Digitization of the supply chain is not about risk migration; it’s a source of competitive edge that every successful company must take. 

Let’s look at six ways in which the digital transformation is repealing the old supply chain: 

1. The Linked Supply Chain 

Implementing smart logistics, like warehouse automation, tracking of cargo, and remote fleet management, can revolutionize organizations. Using supply chain technology, companies can see their assets’ location and status in real-time. Cloud-based GPS tracking and Bluetooth Low Energy (BLE) asset tracking can give you a real-time view of your cargo’s location. Tracking in real-time can help you figure out inefficient delivery routes. 

Adaptability and supply chain optimization depend on automation and business intelligence. Sensors on the Internet can spot supply chain problems and adjust production flow on the fly with minimum human input. Effective supply chain management increases visibility, responsiveness, and resilience.

2. Improving Supply Chain Management by Focusing on Demand

Managing the supply chain to meet demand isn’t anything new. Data is getting bigger, and we’re getting better at drawing insights from it. Demand forecasts typically use historical data points, but those may not reflect the current environment. 

Monitoring, collecting, and reporting data collection from the environment can be done through embedded sensor technologies. Data analysis can make forecasting and replenishment much more accurate. While predictive analytics and machine learning aren’t perfect, they can identify patterns, identify changes, and predict demand.

3. Creating the Digital Thread

Creating a continuous feedback loop is the purpose of the digital thread – sharing information to all consumers. The digital thread goes beyond connecting data and systems; it involves integrating workflows and people. 

The whole production chain will be more responsive thanks to improved data communication, which allows changes in design, manufacturing, volume, and reworking, as well as through-life service. In the end, connecting suppliers, your organization, and your customers transforms supply networks into integrated value chains, in which customers and suppliers work together to lower costs and increase efficiencies. 

Digital threads help you get enhanced business intelligence and a better understanding of the performance of the supplier & customer behavior.

4. Establishing Shared Value

In an integrated value chain, information sharing and transparency are of paramount importance, including constant, bidirectional communications and intercompany visibility into everything from inventory levels, supply statuses, and shipping timelines to future trends predicting shifts in demand. 

To improve efficiencies and enhance interoperability, best practices are shared with internal and external stakeholders. Visibility through the supply chain is mainly about accessing data across business networks, also called a “network of networks.” The synthesis of data from different supply chains is more valuable than data input from just one. 

A win-win-win relationship is created, with business partners generating savings and taking advantage of opportunities.

5. Evolving Customer Expectations

As consumer shopping habits change, a lot of companies are reevaluating their distribution models. The modern customer can’t afford to deal with wrong, or delayed, orders, so logistics and distribution have to happen at lightning speed, from warehousing to order fulfillment to deliver it to the customer’s doorstep. 

Some organizations are therefore moving away from direct store distribution to centralized distribution, allowing real-time inventory management and less reliance on warehouse inventory levels. 

The COVID-19 pandemic has shifted most customer transactions online, so companies have either developed their eCommerce capabilities or looking for companies to provide them eCommerce business solutions. Some companies sell direct-to-consumers (DTC) and use retailers’ strategies to improve their digital customer service. 

A smart way is to create digital order forms and online storefronts so you can talk to customers remotely. Virtual & augmented reality can even be used to show off new products and showcase facility tours.

6. The Threat of Cyberattacks

By removing the traditional barriers to innovation and collaboration, the digital transformation also increases the threat of hackers breaking in and rising supply chain cyber risks.

Attackers often exploit third-party flaws to get access to their ultimate targets. A hole in an organization’s supplier network can be an entry point for hackers. 

The other downside is reputation damage and lost business, especially if the company is deemed cyber-negligent. A supplier evaluation process should identify cyber risks. 

Once the exposures are identified, clear minimum standards should be set up in the contract. We should take measures that are appropriate to the risk and value of the relationship.


Digitizing your supply chain can give your business an edge today while also being more flexible down the road. The digital experts at Cooperative Computing will be happy to assist you with digital transformation.

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