Digital Displacement?


Digitalization is providing the collaboration, integration and visibility we in supply chain always dreamed of. But it won’t be easy getting there. There will be significant and disruptive changes in technology, business models and personnel in order to thrive–and survive–in a connected world.


From time to time, disruptions to the status quo occur causing societies, industries, organizations, and individuals to confront real change. We are at one of these times now. Web everything, digitization of products, new advances in automation and communication, mobile, social, Omni-channel and the Internet of Things are all converging to catalyze a new generation of manufacturing business models. Customers come through any channel across the globe, new supply sources emerge, and new competitors are rewriting the rule books.

The challenge is that in a connected world, there is an assumption of an immediate — and accurate — response. In fact, this is not just an assumption as the presence of the world’s new, smaller microprocessors expands across the markets with connectivity (WiFi and RFID) and processing for data analytics and logic. They will be embedded in locations — the factory floor, smart shelves in warehouses; and in motion — transportation equipment and assets; in the products and packaging we manufacture — from industrial equipment to diapers. This connected world is smart, real-time, and it is calling your supply chain.

This is no small challenge for manufacturers. For decades many of them have built in buffers in time and inventory to avoid dealing with real-time.

Manufacturers have built silos between their physical fixed assets (plants, warehouses) and the information and processes in motion. Clumsy interfaces between customers, carriers, the manufacturers and their suppliers do not have the full, rich data needed to understand market events and respond to them.

There are many stories in the media hyping big data, IoT, digital manufacturing, and so on. But scant attention has been paid to the impact they will have on manufacturers’ supply chain management.

We are publishing this two-part series to bring clarity to digital supply chains for manufacturers. Here, Part One of this series,

Part Two of this series will explore the effect that digital everything is having on the Manufacturer’s Supply Chain.

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To view other articles from this issue of the brief, click here.

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