20 Effects of Digital Transformation on Logistics and Supply Chain

In this age of disruption, businesses live by their ability to adapt. Businesses must learn to adapt well to the changing world, threading the path that leads to a defined and promising destination. Niccolo Machiavelli said, “Whosoever desires constant success must change his conduct with the times.”

Digital transformation has become a new normal for business operations all over the world and it goes beyond just a new app or simple transfer of paperwork from overstuffed filing cabinets to the cloud. Digital Transformation is the adoption of digital technology to transform services or businesses, through replacing non-digital or manual processes with digital processes or replacing older digital technology with newer digital technology.

Logistics and supply chain industry is no exception to the adoption of recent digital transformation offerings.

It seems only natural that the Internet of Things IoT, Artificial Intelligence and Blockchain are considered as the key drivers of Digital Transformation in logistics and supply chain management, with supply chain being a goldmine of structured and unstructured data.

Businesses can achieve greater supply chain transparency and dramatically reduce operating expenses with the adoption of digital logistics solutions such as an optimal software while matching derived data against Machine Learning models implemented in the cloud or on other suitable computing environment.

Let’s take a quick look at 20 effects of adopting digital transformation solutions in a Logistics and Supply Chain business:

Effects of Digital Transformation on Logistics and Supply Chain

1.   Speed and Time

Digital transformation avails Logistics and Supply Chain industries with faster speed to market and greater agility. Speed and time are two of the most crucial factors for any industry – Digital transformation initiatives with Robotic Process Automation as a component to automate time-consuming processes.

2.   Optimizes Inventory

 As part of the supply chain, inventory management includes different aspects such as controlling and overseeing purchases from suppliers and customers, maintaining the storage of stock, controlling the amount of product for sale and order fulfillment. Digitizing these processes will optimize inventory levels to ensure more full-price sales.

3.   Eliminate Manual Processes

Digitization eliminate manual processes and spreadsheets with enterprise digital systems that unite stakeholders around the world, radically improving communication, collaboration and ensuring a free flow of real-time information to everyone involved in the product supply chain.

4.   Optimizes Capital Usage

The faster the supply chain moves, the less capital is tied up in the supply chain. This is a crucial benefit of digitizing your supply chain management processes.

5.   High Level Connectivity Among Devices

Internet of Things (IoT) allows this type of digital transformation, by helping companies densely connect devices using sensors that send crucial and decisive information over a common network.

6.   Business Intelligence

Digital transformations allowed by AI and Cognitive Computing empower the logistics and supply chain industry overcome various business challenges, including process optimization, supply chain management, end-to-end communication, cost control, and improvement of customer experience.

7.   Data Visualization Across Key Factors

Logistics and supply chain deals with quite a huge data goldmine that requires powerful digital transformation strategy for maximum visibility across factors that can affect decision-making. Data visualization and modern dashboards with self-service capability offer user-level digital transformation by representing a large amount of data in a concise, meaningful, and pleasant form.

8.   Maintenance of Machines and Equipment

Digital transformation triggered by technologies such as data analytics, the cloud, and the Internet of Things (IoT) in combination with Machine Learning algorithms helps to make sure items arrive at the right location at the right time and in the best possible condition.

9.   Automated Production Process

Digital transformation has enable factories automate their production processes which in turn improve speed and turnover.

10.  Automated Transportation of Goods

Digital transformation is also paving the way for further automation, through, for instance, drones and automated vehicles.

11.  Predict Customer Demand

Advanced digital platforms can fill the supply pipeline before customers even place orders, based on predicted demand.

12.  Track Status Deliveries

A customer can now monitor and track the status of deliveries. Amazon, for example, is well-known as a pioneer in warehouse automation and delivery tracking.

13.  Reroute Orders

Digital transformation gives customer the ability to reroute orders that are already en route.

14.  Improve Customer Experience

Micro segmentation, mass customization, and other personalization techniques have greatly improve the customer experience.

15.  Agile Omnichannel Distribution

This is enabled by real-time asset tracking, to lower freight costs and improve on-time deliveries.

16.  Automated Distribution

Automated centers and factories for distribution driven by robotics and 3D printing to lower production costs and improve yield.

17.  Improves Employee Training

It is much easier to learn something that was recently introduced and still fairly new than it is to learn something that is massive, complex, and matured.

18.  Evolving as Technology Does

Integrating digital technology to supply chain operations can reduce the need to constantly update tools or find fixes for random occurrences.

19.  Safer Transportation System

The industry is going to experience an influx of self-driving trucks in the nearest future such that eventually, truck drivers will be replaced by self-driving technologies.

20.  Saves Money

Through the digital transformation process, the industry’s leaders will be able to save money by hiring fewer people that are needed to manage and operate the technology.

In conclusion, communicating with an expert before integrating any new software or management solution is very important. Further seeking the advice of an experienced specialist in digital logistics and supply chain management solutions makes a lot of sense as well.