Digitisation is helping to deliver goods faster

“DIGITISATION WILL have the impact on supply chains that steam and electricity had on manufacturing,” declares Joe Terino of Bain. His claim seems hyperbolic, but it may yet prove prescient. Nearly 30 years after the internet first emerged as a tool for business, the management of supply chains at most MNCs, which do not operate in the rarefied air of Amazon and Alibaba, remains a surprisingly backward-looking, sluggish affair.

The good news is that companies in many industries are experimenting with a variety of new technologies and methods that promise to improve how they plan, source, make and deliver. These innovations are making supply chains smarter by increasing their predictability, transparency and speed of delivery.

First, to predictability. Firms have long used historical sales data to come up with demand forecasts, then manufactured and distributed according to the plan. This antiquated approach cannot keep pace with today’s on-demand economy. So firms are experimenting with AI to assess everything from social-media trends and shifts in demand to inventory turnover and vendor behaviour. Their goal is to fine-tune supply chains in real time.

An annual survey by KPMG, a consultancy, and JDA, a supply-chain software firm, released in May, asked executives which technologies had the highest potential...

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