Three Key Factors for Supply Chain Transformation

Supply chain transformationIn our recent webinar, 3 Themes That Will Impact Supply Chain Leaders Now and in the Future, we discussed how optimizing the supply chain promises many benefits. These benefits include reduced costs, improved efficiency, and better relationships with internal and external stakeholders.

We also looked at how many enterprises are encountering significant roadblocks to supply chain transformation. Widespread talent shortages, confusion about technological advances and the best applications of new technology, and an outdated view of the supply ‘chain’ are all factors that work against optimization.


Three key areas of focus are vital to supply chain optimization: technology, people, and process.

1. Technology

Technological advances are a key component to overall competitiveness. Technology can be applied to streamline processes, improve transaction speed, automate repetitive tasks, and increase efficiencies throughout the supply chain. Key areas where technology can improve the supply chain are:

1. Mobility . With so many applications created for mobile access across a number of devices, a supply chain or asset management system can be monitored, managed, and controlled from any location, in real-time. This represents a significant advantage in a global marketplace with a geographically dispersed workforce.

2. Digitization . Using technologies like big data analytics, cloud, and deep learning, companies can improve process efficiency and improve customer interactions.

3. Automation . Automating repetitive processes throughout the supply chain allows a company to merge knowledge, skills, and process, freeing human resources for higher-level, strategic, or customer-facing responsibilities. Automation reduces errors, improves efficiency, and allows resources to be diverted to more complex tasks.

2. People

There is a major shortage of supply chain talent, with some estimates showing demand exceeding supply by a rate of 6 available positions for every one qualified candidate.

Strategies that can be employed to help bridge the talent gap include:

1. Include value propositions. It is vital that talent management programs have structurally sound employee value propositions, tying together compensation, incentive, and career path for supply chain employees.

2. Invest in development. A combination of formal, university-based training and informal, on-the-job learning can help to convert your employees from a ‘labor’ to a ‘talent’ pool. Ensuring that current and future needs are clearly defined is the first step to creating an effective employee development program.

3. Focus on retention. Find out what aspects of employment are most important to people in key roles, and ensure that those needs are being met. Some employees value a flexible work environment; others are more focused on an attainable, continuous career path. Leaders that invest in and accelerate the skills development of their workforce will ensure new capabilities, mindsets and practices exist to handle organizational change and simultaneously be providing a growth plan for the individual.

3. Process

An increasingly globalized marketplace, combined with improvements in communications and information flow have caused supply chains to evolve into intricate, complex networks. However, many businesses still think of their supply chain in simple, linear terms. This simplistic view is preventing companies from optimizing their supply chain processes.

The modern supply chain is an ecosystem, multilayered and continuously adapting. To manage a supply chain, and to optimize strategy and decision making for maximum efficiency and cost savings, a supply chain manager must have an end-to-end view of the entire system, and a deep understanding of the interrelated parts and players that make up the supply chain.

Adopting an ecosystem view will give the supply chain greater openness, flexibility, and adaptability to rapidly changing environments. Companies can expect to achieve a competitive strategic advantage in optimal services, product information, cash flow and optimal profit to the company and its shareholders. In the long run, an ecosystem understanding of the supply chain can lead to faster growth, higher market share, and increased profits to the enterprise.

For more information on supply chain transformation, please watch our webinar. You can also view additional resources here.