Lytica’s chairman and chief strategy officer, Ken Bradley, introduces the concept of digital transformation and details five benefits offered to supply chain managers.
Globalization, increased competition, shifting consumer preferences, labor shortages, component shortages,
plus the need to be streamlined, efficient and cost-conscious, all increase the complexity of supply chain management. As a result, digital transformation is critical.
While all businesses struggle with supply chain management issues, consumer electronics is perhaps one of the most complex supply chains
to manage, thanks to rapid growth within this broad market. Consumer electronics market revenue is projected to reach $602.50 billion by the end of 2023, followed by expected annual growth of 12.07 per cent over the next four years.
For example, consider EV manufacturing volume and all the electronic components (like high voltage applications) needed to create these vehicles. Beyond creating new parts, these components must also meet industry standards as the call for increased regulatory restrictions booms. Then, there is the additional wrinkle of reintroducing mature parts to meet new requirements.
With so many layers of complexity at play, those in consumer electronics require more efficiency and transparency from their supply chain management systems to remain competitive. This is where embracing digital transformation comes in.
Digital transformation is the process of adopting new digital technologies to create or improve products or services and to make operational workflows more efficient and effective. Digital transformation tools let organizations collect and analyze large quantities of data from multiple sources. Users get the best, most up-to-date view of their supply chain, customers and market.
The following five examples illustrate tangible benefits to supply chain teams embracing digital transformation.
1) Digital transformation offers organizations the simplification of focus through the power of data and analytics. By using digital tools to gain access to data, like component pricing or consumer trends, organizations can identify areas for improvement, restructuring or resource allocation.
2) Automation of repetitive tasks. Supply chain management issues can become unnecessarily tedious or error-prone, due to a manual approach. By adopting digital tools, organizations can automate routine tasks like data entry, order management and inventory management. This reduces the chances for inconsistencies/errors and saves time and resources better spent on larger business objectives.
3) Modern digital tools are invaluable for monitoring market changes and tracking real-time price and availability trends. This type of data ensures decision-making processes on pricing or product offerings are always based on data, not instinct, and helps circumvent product shortage issues.
4) Effectively managing supplier relationships. Digital supplier relationship management platforms can provide data on supplier performance, reliability and responsiveness, all critical information when selecting and managing suppliers.
5) Ability to successfully and rapidly redesign and reuse new components. With the right digital transformation tools, users can more easily create prototypes, develop new products and introduce or retrofit components to meet new environmental regulations.
Digital transformation is vital for improving business operations- specific strategies including time-to-market, time-to-cost and quality enhancement. With digital transformation, organizations can harness the power of data and analytics to enhance product quality and pricing while slashing waste. Digital transformation helps improve resource allocation and operations, ensuring organizations operate as competitively as possible.
To navigate supply chain management successfully, digital transformation is vital to improving efficiency and efficacy. Embracing the power of digital tools, data and analytics helps organizations streamline supply chain management and workflows, respond nimbly to shifting market and customer trends, and operate at maximal efficiency in the crowded global marketplace.
For companies ready to embrace digital transformation there are
three key elements to focus on: tools, vendors and partners for supply. However, companies must refrain from attempting to shoulder the entire burden themselves. Instead, they should actively seek capable partners in their digital transformation journey.
Most electronic products share standard core components from reference designs set
out by the manufacturers. Many electronic products share common supply, manufacturing and logistics business models. As a result, they often face similar challenges and effective digital transformation solutions have likely already been successfully deployed in similar contexts.
The best digital transformation tools provide data collection, analysis and interpretation that delivers supply chain transparency
to help organizations avoid product shortages, work with the best vendors/suppliers and perform at their peak.