Company leaders continually face disruptions affecting supply chain operations leading to customer dissatisfaction, revenue loss, and cost increases. The inability to anticipate when actual performance will deviate from the plan, and take proactive action to intervene, put companies in a vulnerable reactive position with customers.
To overcome these challenges, companies must harness enterprise and external data using modern technology such as IoT, Machine Learning and AI. Although aware that digital transformation is needed to build supply chain resiliency within constrained budgets, many companies struggle to create business cases for utilizing supply chain intelligence platforms. A recent survey of business and IT leadership in the pharmaceutical industry revealed the following:
Respondents described additional details concerning the challenges identified in the survey results. These details include:
- Digital transformation without a prioritized business case. Respondents stressed the need to map the scope and priority of transformation capabilities along an implementation journey based on business case analysis.
- Big bang versus incremental transformation. Supply chain innovation through digital transformation is a continuous process implemented through a program of multiple business releases over time. This incremental approach, coupled with individual business cases for each release, is the only method to ensure the necessary organizational, process and individual behavior changes required for success. Additionally, the incremental approach allows the predictions and interventions to continually improve as the data and math continually learn.
- No digital supply chain intelligence platform. Survey participants stressed the need for a platform to continually understand past, present, and future end-to-end supply chain behavior. Transformation built around inaccurate and stale data, along with siloed technology solutions, limits continual end-to-end supply chain innovation and holds enterprises back from realizing business case ROI.
- Lack of internal and ecosystem collaboration. The lack of collaboration internally and across trading partners limits opportunities to reduce human-caused supply chain variability and increases entire network inefficiency, resulting in increased cost, lower customer service levels and lost revenue.
Tackling the Challenges
Companies must establish value-based business cases for each capability release. Business cases that focus on value for your company, customers, and ecosystem of partners. An incremental crawl-walk-run approach to implementation manages costs and risk. As supply chain digital transformation functions are rolled out, more value gets turned on. Each release should have a documented ROI that “pays for” the next release.
An incremental rollout based on business value requires a modern solution platform approach to data, software, integration, analytics, and data science while leveraging IoT, OT, data aggregators, and legacy systems in a vendor-agnostic fashion. The platform must be scalable and flexible while allowing rapid innovation to implement solutions to solve new digital use cases that continually emerge. This flexibility must be affordable and supportable so that customer-specific use cases do not lead to one-off customization that must be supported and maintained outside the solution baseline.
As an example, working with TransVoyant, a top five pharmaceutical manufacturing customer prioritized a list of transformational digital supply chain use cases by focusing on both patient outcomes and financial ROI. The platform capability released and implemented saved millions of patient doses while avoiding more than $60M of product discards in one year. The initial outcomes more than funded the next several releases along the TransVoyant platform-enabled digital supply chain journey.
A digital supply chain platform providing live end-to-end supply chain transparency and continual understanding of past, present, and future behavior is a pillar of enterprise capability for TransVoyant’s forward-leaning customers. Even with the platform, these customers establish value-based business cases for each capability release. The TransVoyant platform and their business case-driven incremental capability implementation discipline have turned their supply chains into competitive weapons.