Your Digital Strategy May Make the Supply Chain Weaker

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The deployment of digital supply chain strategies and their effectiveness in improving outcomes. According to the research, less than 7% of companies deploying a digital supply chain strategy saw improvement. The current level of inflation and volatility is high, making it difficult for traditional techniques to predict demand using historic order patterns. The article suggests that the answer lies in redefining work to design the supply chain to sense and adapt in the face of variability, rather than relying on black and white answers generated by a digital brain. That many digital supply chain strategies are an extension of the goal of tight integration to enterprise data, which will not improve business outcomes and may even make them worse.

The author is arguing that traditional supply chain planning approaches, even with the incorporation of digital technologies like machine learning and artificial intelligence, are insufficient in today’s highly volatile and unpredictable environment. They emphasize the importance of sensing and adapting to variability, which is a capability that is not currently present in most supply chains.

The author believes that supply chains need to be redesigned to incorporate sensing and feedback loops, similar to how the human brain works. Simply relying on historical data and attempting to be very precise on imprecise data through tight integration to enterprise data is not enough to improve business outcomes. In fact, the author warns that blindly deploying digital supply chain strategies without considering these issues may actually make business outcomes worse.