The results uncovered by this research call for companies to make rapid changes in their supply chains. They require companies to change the data they collect to make decisions, change the technology used to collect and analyze that data, and finally change, the focal point for decision-making. Companies that do this will significantly outdistance their competition, and companies that don’t will lose ground. Modifying the four core DSC factors of Demand, People, Technology and Risk is not easy. However, the rewards are great.
Companies have begun creating Digital Supply Chains that make a difference, but progress is slow. They know the data they have, and are collecting from an array of sensors, which could be helpful. They understand that the Internet of Things (IoT) is in operation with everything from electric toothbrushes to automobiles to credit cards contributing data to it. Moreover, they are aware of the tremendous power of social media and its profound influence on society and business. However, the truth is that they are unable to craft a process to capture this data, clean it, analyze it and use it to drive supply chain decisions.
The good news is that there is a clear path forward. It involves heavy use of Artificial Intelligence (AI) and Machine Learning (ML) driven by specific algorithms. Fundamentally, the effective use of AI/ML and the enormous amount of data available will unlock the potential for your company to evolve from reactive to predictive. Companies will be able to anticipate future demand and predict the likelihood of future risks. However, effective use of AI/ML will require a cross-functional team of people to manage it. People to ask the right questions, define the right problems and perhaps, most important, use their judgement. We call this team the “Algorithm Council.” Companies that have this Council will create the algorithms that get smarter every day, and those that use AI/ML to manage the massive amounts of data will have winning supply chains.
In the following sections you will discover how the Digital Supply Chain manages demand, not just supply, a description of the research methodology, and a collection of the top insights that were derived from the work. Taken together, you will have a foundation upon which to inform the management decisions you have to make and the actions you have to take to create success with a leading-edge Digital Supply Chain.