Typically our commentary on various postings across the digital media landscape are pretty much limited to things that affect payments, in one way, shape or form. In this referenced piece at MoreThanDigital, the author, an academic in the field of service and logistics management, provides a summary argument around the efficacy of using latest gen tech in supply chain management for use by smaller companies.
Since supply chains are interrelated with financial operations in terms of creating, ordering, paying, receiving, and financing good and services across the globe, there is a direct impact on things we cover including IoT, AI, blockchain, and so on, with the common denominator being digitalization, without which none of this stuff actually works well.
So the 4th industrial revolution is underway and by definition requires some level of digital transformation.
‘In principle, most companies have a positive attitude toward digital transformation. In a 2018 study, Kersten et al. already came to the conclusion that 74.2% of the stakeholders surveyed saw high to very high opportunities in this, but only 35.4% saw high to very high risks. However, the opportunities also result in digitization pressure. In a survey by candidus, the mostly medium-sized respondents answered that the pressure of digitization will increase in their company in the next five years (agreement of 5.9 on a scale of 1 (very low) to 7 (very high))…. What does Digital Supply Chain mean? It is undisputed that there can be no Industry 4.0 without a digital supply chain (“SCM 4.0”). SCM 4.0 is about networking digital technologies along the value chain (ideally from the raw material supplier to the end customer) with the goals of real-time capability and self-control in order to increase customer orientation, effectiveness and efficiency. The basic prerequisite is the provision of high-quality data in real time, because only in this way can agile action succeed in close coordination with customer and supplier networks….The digital supply chain thus goes beyond traditional systems with materials management functions and is instead mostly Internet-based. A possible classification of SCM 4.0 can be based on the classic SCM model with “SC Design”, “SC Planning” and “SC Execution”.’
The author goes on to discuss how this applies in the SME space and provides some examples. We review the interconnectivity of all these factors in various pieces posted at this channel as well as member research.
For those interested in the modernization of supply chains in general, a good piece to review, requiring only a few minutes, and may spur some other digging, since a few links to other studies are embedded as well.
We review the interconnectivity of all these factors in various places posted at this channel as well as member research. First of all, it should be noted that although various studies distinguish between large companies and SMEs, in reality the supply chains are often interrelated, with corporations accessing medium-sized suppliers, for example. If we look at the automotive supply chain, for example, we see that automotive manufacturers (OEMs) are often faced with large suppliers (tier ones), while the downstream upstream suppliers (tier twos) are often medium-sized. Bosch, for example, already formulated in 2019 that it sees great potential in small and medium-sized suppliers as part of the digitization of its supply chain.’
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group