Leveraging Digital Technologies To Reinvent And Accelerate Supply Chain Automation – LogiSYM October/November 2020

Leveraging Digital Technologies To Reinvent And Accelerate Supply Chain Automation – LogiSYM October/November 2020

Beyond the traditional business models

With the proliferation of technology, digital transformation has taken many industries by storm. The logistics sector is also not immune to these changes. The world of logistics and distribution is volatile, uncertain and more competitive than ever before. With the digitization trend, a major shift is imminent in the Industry. Automation and digitization of core business processes have become the norm, not only for business development but also for long-term sustainability of business operations.

The dynamic conditions of this sector, enterprises are under increasing pressure to provide flexibility and quality in their product offerings. To optimize operating costs and provide a smooth customer experience, companies are forced to re-examine and re-shape their traditional business models.

To improve the end consumer experience and thrive in innovation-driven environment, businesses must have a more proactive approach, targeting digital strategies in their core business plans. There is more to digital transformation than creating an online packaging around the existing product offerings. It begins at the most fundamental level and requires companies to re-think their strategies, from product innovation and marketing to customer acquisition and retention.

Prevailing challenges in the industry

The fundamental challenge that companies face today is that the majority of their resources are focused on aggressive marketing and sales efforts. They aim at a market push for their products, with little attention to the ‘how, when, where and who’ in the entire logistics and supply chain. Simply creating a product or service and handing it over to sales with revenue KPIs is not enough. The hyper-competitive and digitized market necessitates end-to-end solutions. Moreover, companies have multiple products in the market, at different life cycles and it is imperative to keep track of all products at all times. But the traditional linear approach makes it challenging for the companies to monitor on-ground sales and activities of agents in the distribution network.

A lack of visibility on the product movement in the market, can skew the perception of demand and supply. This  can lead to higher costs and loss of revenue. The need for more visibility and control in logistics, is needed to closely monitor the activities related to their inventory, sales, and transactions. Therefore, the focus of many companies has shifted from execution and ‘closing the loop’ to the more effective management of the end-to-end supply chain, which requires collaboration and orchestration.

To gain a competitive advantage, speed and timing are the two most important success factors. Businesses are striving to be more customer-centric and adaptive to the hyper-connected environment. The aim is to attain optimizations in distribution networks, with improved speed and responsiveness. Supply chain automation solutions in today’s fast-paced market, need to be more agile to significantly reduce time to market. The underlying principles for this solution must be based on data-driven models. This would ultimately allow companies to extract actionable insights.

Digitization and data-driven strategies

Digitization and innovative technology have become indispensable tools for improving the efficiency, quality and capacity of supply chain management. It is crucial for companies to harness the power of smart technology to create a comprehensive solution or a platform to boost revenue and achieve targeted growth. Innovation in technology and digital transformation are avenues that can effectively ‘lead the horse to the water’, but primarily it is up to companies to leverage on these digital tools.

Supply chain automation can help mitigate risks and optimize costs for businesses. However, it requires cross-functional collaboration and data-driven digital strategies. Managing digitalized distribution network, requires technical capabilities entailing business intelligence, strong alignment between business and supply chain strategy, and application of advanced analytics.

Innovation solution for logistics and distribution sector

With increasing demands of end customers and transaction volumes, it is important for companies operating in the logistics and distribution sector to have fast, reliable and flexible business operations. They have to be able to create new and innovative delivery solutions to ensure the sales readiness of their retails network.

The process of digital transformation in logistics and supply chain is more than just installing a new system or software. It is a collaborative endeavor that requires strategic repositioning of the company. The implementation of digital technology unfolds in three main areas; warehouse management, manufacturing processes and distribution chain management.

The end-to-end process of product delivery and distribution has multiple levels and steps involved. This makes it essential to rely on digital solutions that can simplify delivery flows and make it easy for them to manage complex hierarchies. It should facilitate companies to untangle clusters of logistics processes, enabling high level of flexibility, so as deploy at any stage of development. Capturing data for the distribution network and processing it with speed and accuracy is crucial. In addition, digital solutions should incorporate advanced reporting capabilities and data analytics.

A one-stop solution for logistical players

A platform for supply chain automation should serve as a one one-stop solution. The solution must be capable of handling the complete process of inventory planning, ordering, and real-time performance management through a user-friendly interface.

Depending on the requirements, companies should have the flexibility to plug in unique modules from the solution into their supply chain eco-system. The implementation process of a digital strategy does not have to be an ‘all or nothing’ approach. Companies should be able to pace the deployment of this solution to reap the full benefits. The modularity of intelligent tools must facilitate the gradual digital transformation process, with the capability to replace parts of the system and support the different deliver models required.   

The supply chain automation platform must be a dynamic, enterprise-level solution, with  cross-industry applicability, delivering a range of products, from physical to digital and intangible. The platform’s capabilities should allow companies to achieve better competitive positioning, irrespective of their industry.

A solution for tracking inventory and visibility of sales products in transit, should provide full control to companies with distributed supply chain networks.

Companies work within a network of partners and logistical players, full visibility, control, and a holistic understanding of the market, is a basic requirement. The solution should not only offer omnichannel support and intelligent reporting but also geo-tracking and geo-mapping capabilities. It needs to provide complete visibility of distribution flows, market demand and supply insights, and post-sales insights. Real-time stock visibility along with low stock alerts enables end-to-end inventory lifecycle management.

This provides a glass-effect view of the entire supply chain and puts companies in a position to have full circle visibility of every serial of a given product from procurement to sales and distribution.

Artificial intelligence and data analytics embedded into the solution, helps companies advance their digital agendas. A supply chain automation platform should enable companies to shift from a traditional transactional-based system to a data-driven, intelligent systems. It must help automate processes, transform large amounts of captured data into a business strategy by putting context around it and draw recommendations accordingly.

This allows companies to learn from their data and understand the consumption patterns of the end consumers. Additionally, demand forecasting is a key element in the digitized supply chain platform that facilitates optimization of inventory management. This platform, would give an enhanced access to user-friendly dashboards that provide real-time and updated analysis, with optimization of the entire distribution network.

The platform not only optimizes trip management but also offers inventory predictions, with the help of low stock alerts and demand forecasting, enabled by artificial intelligence and machine learning.

Business intelligence with powerful analytics, allows companies to transform their transaction data into valuable information. Companies can slice and dice the data, learn the behaviors of their end customers and make better decisions than before.

Business intelligence makes this solution capable of automatically tracking the performance of on-going activities. Managers can predict possible declines and take corrective measures in time. With this useful information at their disposal, companies would make informed decisions and also enhance their sales by incentivizing resellers or agents in their distribution chain.

Consumer behavior patterns, market trends and sales trends insights, are all crucial data to drive quantitative & qualitative sales targets, sales incentives and overall business performance. Advanced supply chain solutions should also be equipped withuser-friendly and easy to follow platform for incentivization and promotion. The embodiment of typical gaming elements, like point-scoring and leaderboards, in the platform, significantly improves the learning curve and performance of complex tasks for sales.   Essentially, it is an interactive way of enhancing the performance of sales agents as they can gain points by the completion of certain tasks, and then redeem those points for rewards. While supply chain management solutions manage the end-to-end product flow from inventory to last-mile delivery, they are capable of realization of the actual “sale” amount associated with the movements. This means that organizations are more agile, with faster account reconciliations for product moves from one stage within the supply chain to the next.

The next step is include a data-driven approach to cash collections. This is most effective for economies where transactions are either mostly cash-based or their monetary value is low. Using a data-driven approach, means organizations can minimize/optimize agent trips to ensure cash collection is done based on certain thresholds.

With this tool at their disposal, companies would have a vantage point solution to provide a one-stop operational window, from product delivery to cash payment and reconciliation. It would enable efficient management of capital and transparency as well as provide ease and flexibility to the POS and agents.

Strategic repositioning and digitization of distribution network

A complete automated and optimized solution would enable companies to manage the workflow of each product.  Successfully deployed digitized sales and distribution network across the logistics industry would have the ability to optimize demand and supply, manage and track inventory till the last mile, and monitor all entities which are involved in field distribution and order fulfillment. Through the automation of the re-order cycle, adequate inventory availability and optimization of warehousing, will ensure inventory is replenished and stocked based on demand. It also ensures that cash is not tied up in excess inventory.

The next-gen solution in supply chain management is much faster and easier to use. With reduced turnaround times with reliance on a data-driven and actionable insights model to cater to volatile market demand.

Sandipan Mukherjee

Chief Operating Officer
Seamless Distribution Systems (SDS)

Sandipan Mukherjee has 20+ years of progressive leadership experience in implementing, managing and leading diverse software and systems engineering teams all over the world. His strong forte is providing key leadership and strength for the delivery of business-critical functions within the organization and externally towards partners and customers.

Seamless Distribution Systems (SDS) is a Swedish multinational with 30+ years of experience in providing digitization solutions for sales and distribution processes. A global leader in technology, SDS delivers end-to-end platforms for digital value distribution and supply chain management to 500+ million users indirectly. They facilitate some of the world’s largest sales networks, enabling customers to drive revenue growth and optimize operations. Sales Force Optimization (SFO) is part of the product offering of SDS, which is a complete multi-product supply chain management solution. It is a comprehensive solution to track the flow of stock, optimize the order fulfillment process through the products’ lifecycle, and manage all entities for a business.

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LogiSYM Magazine October/November 2020
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