Discover how digital supply chains use AI and connected devices to modernize end-to-end processes for greater efficiency, resiliency, and incisive decision-making.
Supply chains span the globe, encompassing all the steps that go into sourcing the raw materials, manufacturing goods, and getting the final product to the end customer—who is often located thousands of miles away from the factory
Lay on other complexities—customizations, customer service, and compliance—and supply chains are more challenging to manage than ever, especially with different rules at play throughout different countries and jurisdictions. And the need to go toe-to-toe against the rapid-fire logistics of Amazon only raises the stakes.
To win and keep customers today, every step of the supply chain must function flawlessly—from before the product is produced to long after the customer has it dropped off at their doorstep.
That’s where digital supply chains come in. A digital supply chain leverages big data, artificial intelligence (AI), and the Internet of Things (IoT) to transform supply chain management (SCM) for maximum agility, adaptability, and scalability.
Today, technology captures big data throughout every inch of the process and then uses real-time, automated analysis tools to share company insights and actionable solutions.
In this article, you’ll learn more about digital supply chains and how they differ from traditional ones. You’ll also see examples of digital supply chains in action, the benefits and risks of adoption, and what the future may hold in store.
A digital supply chain is like a traditional one but digitalized using AI and IoT technologies.
A traditional supply chain involves the linear process of moving goods from suppliers to manufacturers to stores to customers, relying heavily on manual processes. It may conjure up images of a warehouse supervisor walking the floor with a pen tucked behind their ear and clipboard, as they manually count freight loads or ask other staff to "Get Santa Fe on the phone" to find out why there's a shipping delay.
In a digital version, there's nothing to walk around, count, and jot down on a clipboard. And there's no need to "call Santa Fe" to figure out where the iron is. With handheld scanning devices and connected real-time data, warehouse leadership already knows the answers. Instead of manually digging for data, they can concentrate on higher-level planning and strategy.
Many supply chains have one foot stuck in both camps. These companies may use computers and electronic devices to manage many work processes, but not all systems are interconnected. This delays communication where different business units have access to different data, and activities must be coordinated through a mix of phone calls, emails, faxes, meetings, and paper-based documentation.
Many businesses, if not most, rely on a mix of manual and updated digital processes.
Upgrading to a fully digital supply chain can be a resounding win. Rather than limiting AI, IoT, and big analytics to isolated parts of your supply chain, integrating them across the entire system empowers your entire workforce. The whole organization can benefit from faster, smoother collaboration and decision-making. It’s a big win for the customer, too.
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Adopting a digital supply chain offers many benefits that traditional supply chains can't match.
Digital supply chains streamline operations by automating routine tasks such as inventory management, order processing, and shipment tracking to reduce manual errors and speed up processes.
AI-powered analytics identify bottlenecks, such as delayed order fulfillment or stock discrepancies, and optimize workflows for faster and more efficient supply chain operations.
Additionally, digital supply chains enhance performance by providing real-time data insights and predictive maintenance to prevent equipment failures and minimize downtime.
IoT devices provide real-time tracking of assets, from raw materials to finished products. This visibility ensures better inventory management and reduces the risk of stockouts or overstocking, thus enabling companies to maintain optimal stock levels.
With AI and big data analytics, businesses can make informed decisions based on real-time data. Predictive analytics can forecast demand, optimize inventory levels, and plan for potential disruptions to enhance strategic planning and operational agility.
AI is a transformative force for the digital supply chain of today and tomorrow. It enhances many aspects of SCM, from demand forecasting to predictive maintenance.
AI algorithms analyze historical data and market trends to predict future demand. Supply chain managers use these AI algorithms to forecast demand and plan inventory levels, reducing carrying costs, overproduction, and stockouts.
AI-powered predictive maintenance can keep machinery and equipment running at peak conditions. It allows for proactive maintenance schedules instead of waiting for equipment failure. This minimizes downtime, extends the lifespan of machines, and can ensure more continuous production.
AI elevates route optimization for deliveries. Beyond the free GPS apps that most people are familiar with, AI-powered route optimization can analyze infinitely more data points to plot the best route including vehicle capacity, fuel consumption, and delivery time windows. It can also dynamically adjust routes in real time to respond to road closures or demand surges.
This approach is also much greener, as these enhanced logistics can reduce idle time and extra carbon emissions, resulting in increased sustainability and cost reductions.
IoT devices are central to the digital supply chain, offering a continual flow of real-time data to enhance operational efficiency.
IoT sensors track the location and condition of assets throughout the supply chain. This real-time visibility reduces loss, improves asset utilization, and provides accurate delivery times to customers. Additionally, real-time data from IoT devices is shared with all supply chain stakeholders for improved collaboration.
IoT devices can also monitor environmental conditions to ensure that products are stored and transported under optimal conditions. This includes temperature, humidity levels, light exposure, vibration, air quality, and carbon dioxide levels.
This is especially critical for industries like food, beverage, medical, and pharmaceuticals.
IoT-enabled smart warehouses use automated systems to manage inventory to streamline the picking and packing process for faster order fulfillment and reduced human error.
An integrated digital supply chain leverages both AI and IoT for a seamless and efficient network. Integrated supply chains optimize performance and customer goodwill through the easy flow of information, including real-time notifications and order data.
See how Boers & Co, a precision solutions company, has embraced Epicor Kinetic and IoT innovation to better support their workers with robots, cobots, and autonomous bots. Learn more.
Industrial distributor, Transply, Inc., uses AI-powered Epicor Prophet 21, ERP software for wholesale distributors, to replace inefficient, manual processes to improve customer service and margins. Find out more about Transply's profit-boosting success.
Implementing a digital supply chain requires a strategic approach, which is rolled out over several phases to minimize disruption. This phased approach ensures seamless integration and allows time for staff to adapt to new technologies.
While the benefits of a digital supply chain are clear, businesses may face challenges during implementation.
Advancements in AI and IoT are transforming the digital supply chain, leading to greater speed, efficiency, and adaptability.
A digital supply chain solution that uses the power of AI and IoT can offer significant benefits for businesses, such as speed, automation, and better collaboration and decision-making. By integrating these technologies, you can create a more resilient and agile strategy, one that’s better equipped to handle the challenging conditions of the modern supply chain landscape.
Whether you need a solution for better inventory management, improved predictive maintenance, or more streamlined operations among different work sites, a digital supply chain can supply the tools and technology for your organization to flourish.
Ready to learn more about transforming your supply chain operations?
Chat with an expert today for free to learn more about Epicor’s innovative digital supply chain solutions. Contact us now and take the first step towards a smarter, more efficient future.
