12 Digital Levers Used for Digitalization of Supply Chain

12 Digital Levers Used for Digitalization of Supply Chain

Krishna Kumar
Head of Production, Aditya Birla Fashion and Retail Limited
Email: krishnakumarmft@gmail.com

Introduction:

1. Supply chain management is the process of planning, organizing, and controlling the flow of goods and services from suppliers to customers.
2. Digitalization is the use of digital technologies to improve efficiency, agility, and sustainability.
3. This presentation will discuss the digital levers that can be used for digitalization of supply chain.

What is digitalization?

• Digitalization is the use of digital technologies to improve efficiency, agility, and sustainability.
• These technologies include artificial intelligence (AI), blockchain, big data analytics, cloud computing, cybersecurity, data visualization, the internet of things (IoT), machine learning, robotics, radio-frequency identification (RFID), supply chain management (SCM) software, and 3D printing.
• Digitalization can be used to improve all aspects of the supply chain, from planning and forecasting to production and transportation.

Digital Levers for Digitalization of Supply Chain:
12 digital levers that can be used for digitalization of supply chain:

1. Artificial intelligence (AI)
2. Blockchain
3. Big data analytics
4. Cloud computing
5. Cybersecurity
6. Data visualization
7. Internet of things (IoT)
8. Machine learning
9. Robotics
10. Radio-frequency identification (RFID)
11. Supply chain management (SCM) software
12. 3D printing

Each of these levers has its own unique benefits and applications.

Brief description of the 12 digital levers:

1. Artificial intelligence (AI): AI is the ability of machines to learn and perform tasks that normally require human intelligence. AI can be used in supply chain management to automate tasks, improve decision-making, and optimize processes.

2. Blockchain: Blockchain is a distributed ledger technology that allows for secure and transparent transactions. Blockchain can be used in supply chain management to track the movement of goods and materials, improve traceability, and prevent counterfeiting.

3. Big data analytics: Big data analytics is the process of collecting, storing, and analyzing large amounts of data to gain insights. Big data analytics can be used in supply chain management to identify trends, optimize inventory levels, and improve customer service.

4. Cloud computing: Cloud computing is the delivery of computing services— including servers, storage, databases, networking, software, analytics, and intelligence—over the Internet (“the cloud”). Cloud computing can be used in supply chain management to reduce costs, improve scalability, and increase agility.

5. Cybersecurity: Cybersecurity is the protection of information systems from unauthorized access, use, disclosure, disruption, modification, or destruction. Cybersecurity is essential in supply chain management to protect sensitive data, such as customer information and intellectual property.

6. Data visualization: Data visualization is the presentation of data in a way that is easy to understand and interpret. Data visualization can be used in supply chain management to communicate information to stakeholders, identify trends, and make decisions.

7. Internet of things (IoT): The IoT refers to the network of physical devices that are connected to the internet. These devices can collect and transmit data about their environment. The IoT can be used in supply chain management to track the movement of goods and materials, improve visibility, and optimize processes.

8. Machine learning: Machine learning is a type of AI that allows computers to learn without being explicitly programmed. Machine learning can be used in supply chain management to improve forecasting, optimize routing, and prevent fraud.

9. Robotics: Robotics is the use of robots to perform tasks that are typically done by humans. Robots can be used in supply chain management to automate tasks, improve efficiency, and reduce costs.

10. Radio-frequency identification (RFID): RFID is a technology that uses radio waves to identify objects. RFID can be used in supply chain management to track the movement of goods and materials, improve traceability, and prevent theft.

11. Supply chain management (SCM) software: SCM software is a suite of software applications that helps organizations manage their supply chains. SCM software can be used to plan, execute, and control the flow of goods and materials from suppliers to customers.

12. 3D printing: 3D printing is a process of creating three-dimensional objects from a digital file. 3D printing can be used in supply chain management to create customized parts, reduce waste, and improve efficiency.

12 Digital Levers Usage and Application Areas:

1. Artificial intelligence (AI): AI can be used to automate tasks, improve decision-making, and optimize processes. For example, Optimize routing for transportation, Forecast demand, Prevent fraud, Recommend products to customers
2. Blockchain: Blockchain can be used to track the movement of goods and materials, improve traceability, and prevent counterfeiting. For example, blockchain can be used to: a) Track the provenance of food products b) Trace the ownership of luxury goods c) Prevent counterfeit pharmaceuticals
3. Big data analytics: Big data analytics can be used to identify trends, optimize inventory levels, and improve customer service. For example, big data analytics can be used to: a) Identify patterns in customer behavior, b) Predict demand and c) Optimize inventory levels
4. Cloud computing: Cloud computing can be used to reduce costs, improve scalability, and increase agility. For example, cloud computing can be used to: a) Store data, b) Run applications and c) Process transactions
5. Cybersecurity: Cybersecurity is essential in supply chain management to protect sensitive data, such as customer information and intellectual property. For example, cybersecurity can be used to: a) Protect data from unauthorized access, b) Detect and prevent cyberattacks and c) Mitigate the impact of cyberattacks
6. Data visualization: Data visualization can be used to communicate information to stakeholders, identify trends, and make decisions. For example, data visualization can be used to: a) Create dashboards that track key performance indicators, b) Present data in a way that is easy to understand and c) Identify trends in data
7. Internet of things (IoT): The IoT can be used to track the movement of goods and materials, improve visibility, and optimize processes. For example, the IoT can be used to: a) Track the location of goods in transit, b) Monitor the condition of equipment and c) Detect anomalies in the supply chain
8. Machine learning: Machine learning can be used to improve forecasting, optimize routing, and prevent fraud. For example, machine learning can be used to: a) Predict demand, b) Optimize routing and c) Identify fraudulent transactions
9. Robotics: Robotics can be used to automate tasks, improve efficiency, and reduce costs. For example, robotics can be used to: a) Pick and pack orders b) Inspect products and c) Load and unload trucks
10. Radio-frequency identification (RFID): RFID can be used to track the movement of goods and materials, improve traceability, and prevent theft. For example, RFID can be used to: a) Track the location of goods in transit, b) Identify counterfeit products and c) Prevent theft of goods
11. Supply chain management (SCM) software: SCM software can be used to plan, execute, and control the flow of goods and materials from suppliers to customers. For example, SCM software can be used to: a) Plan production b) Manage inventory and c) Optimize transportation
12. 3D printing: 3D printing can be used to create customized parts, reduce waste, and improve efficiency. For example, 3D printing can be used to: a) Create customized medical devices, b) Produce spare parts on demand and c) Reduce waste in manufacturing

How to Choose the Right Digital Levers?
When choosing the right digital levers for a supply chain, organizations should consider the following factors:

• The specific needs and goals of the organization
• The budget
• The level of technological maturity
• The availability of skilled personnel
• The willingness to change

Examples of How Digital Levers are Used in Different Application Areas:

1. Retail: AI can be used to recommend products to customers, blockchain can be used to track the provenance of products, and big data analytics can be used to optimize inventory levels.
2. Manufacturing: AI can be used to automate tasks, robotics can be used to handle hazardous materials, and 3D printing can be used to create customized parts.
3. Logistics: AI can be used to optimize routing, blockchain can be used to track shipments, and IoT can be used to collect data about the environment.

The Challenges of Digitalization:
The following are some of the challenges that organizations face when implementing digital levers in their supply chains:

• The cost of implementation
• The lack of skilled personnel
• The resistance to change
• The security risks

How to Overcome the Challenges of Digitalization:

1. The cost of implementation: The cost of implementing digital levers can be a challenge for some organizations. However, there are ways to mitigate this cost, such as using cloud-based solutions or open-source software.
2. The lack of skilled personnel: The lack of skilled personnel to implement and use digital levers can also be a challenge. Organizations can overcome this challenge by investing in training and development programs, or by partnering with third-party providers.
3. The resistance to change: The resistance to change is a common challenge when implementing new technologies. Organizations can overcome this challenge by communicating the benefits of digitalization to employees, and by providing them with the support they need to make the transition.
4. The security risks: The security risks associated with digitalization can be a challenge. Organizations can mitigate these risks by implementing security measures, such as encryption and access controls.

The Future of Digitalization in Supply Chain Management:
Some of the future trends in digitalization and how they are likely to impact supply chain management:

1. The rise of artificial intelligence
2. The increasing use of big data analytics
3. The growing importance of sustainability
4. The emergence of new technologies, such as quantum computing and augmented reality

Conclusion:

• Digitalization is an important trend that is transforming the supply chain.
• By adopting digital levers, organizations can improve their efficiency, agility, and sustainability.
• The future of supply chain management will be increasingly digital.

References:

[1] “Digital Supply Chain Management: A Guide to the Future of SCM.” Capgemini, 2022.
[2] “The Future of Supply Chain Management: How Digitalization Is Transforming the Industry.” Deloitte, 2022.
[3] “Digital Levers for Supply Chain Digitalization.” Gartner, 2022

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Mazharul Islam Kiron

Founder & Editor of Textile Learner. He is a Textile Consultant, Blogger & Entrepreneur. He is working as a textile consultant in several local and international companies. He is also a contributor of Wikipedia.

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