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Digital supply networks

Turn your supply chain into an “always-on” strategic differentiator

Organizations are achieving operational performance breakthroughs as digital supply networks enable supply network visibility—and unprecedented insights, as shown in this report developed by Deloitte US.

Watch the video | Digital Supply Networks: the digital transformation of supply chains

About our digital supply networks services

The Deloitte Digital Supply Networks offering helps senior executives, including CEOs, CIOs, and supply chain leaders, identify and realize new supply network opportunities while managing their inherent complexities. Together with ecosystem partners, such as Singularity University, GE Digital, and Kinaxis, we immerse clients in the most forward-thinking perspectives on the future of supply chain, including artificial intelligence, advanced robotics, additive manufacturing, and the Internet of Things.

Our practice offers deep industry knowledge in all functional areas of supply chain, coupled with robust end-to-end, cross-functional supply chain experience.

We help organizations transform their supply chains by addressing two key areas:

  1. Strategy. We help companies create supply network strategies and engage with ecosystem partners that allow the realization of their business vision and aspirations These strategies may differ by business unit, product, and trade channel. We also help clients explore the “art of the possible” through digital supply network immersion sessions.
  2. Execution. Once the strategy is in place and/or an accretive digital solution is prioritized and chosen, we build, pilot, and deploy the solution(s) using an agile approach. Digitizing the supply network may involve building digital threads that run through each of the existing supply chain nodes, blurring the lines between traditional functions, products, and divisions. We develop and execute on roadmaps that consist of a series of rightsized, rapid “sprints” to quickly deliver incremental value while we continuously iterate and improve.

What are digital supply networks?

Dramatic advances in computing memory and processing are spurring entrepreneurs to develop innovative new digital technologies and capabilities—and ushering in Industry 4.0, the fourth industrial revolution. Disruptive technologies, including new sensors and artificial intelligence (also called machine learning and cognitive computing), create the foundation for analytics and a conversion between the physical and digital worlds, transforming traditional, linear supply chains into connected, intelligent, scalable, customizable, and nimble digital supply networks. Digital supply chain management now includes gathering insights from distributed data, sensors, and connected assets to drive actionable improvements via advanced analytical and digital solutions. The Deloitte Digital Supply Networks offering helps companies and business leaders capitalize on this opportunity, create competitive advantage, and compete to win.

Digital Supply Networks: Traditional, linear supply chain nodes are collapsing into a set of dynamic networks, allowing dramatically increased differentiation:

How do digital supply networks work?

​Digital supply networks establish a “digital thread” through physical and digital channels, connecting information, goods, and services in powerful ways:

  • Physical to digital: Capture signals and data from the physical world to create a digital record
  • Digital to digital: Exchange and enrich information using advanced analytics, artificial intelligence, and machine learning to drive meaningful insights
  • Digital to physical: Deliver information in automated and more effective ways to generate actions and changes in the physical world

​Unlike a traditional supply chain model, digital supply networks are dynamic, integrated, and characterized by a high-velocity, continuous flow of information and analytics.

How can digital supply networks benefit my business?

The Deloitte Digital Supply Networks offering can help your team turn your supply chain into a competitive differentiator with the potential to achieve results such as:

Increased revenue:

  • Reorders and refills. Smart packaging, applications and data can be combined, either automatically or with minimal intervention, to push reorders and refills.
  • Marketing effectiveness. Targeted marketing, combined with data from inventory and competitive pricing, can facilitate dynamic discounting.
  • Direct connection to customers. Increased access to customers can drive sales at the precise point of consumption, for example ordering groceries directly from the refrigerator.
  • Value of data. Gathering, packaging and selling data from existing customer bases can open up new channels of revenue.
  • Speed to market. Effective use of product lifecycle management accelerates every step from product development to delivery and enables innovative products to reach customers more quickly.

Improved margins:

  • Cost of R&D. Rapid prototyping can lower the cost of R&D.
  • Cost of raw materials. Digital advances can help identify substitute materials, or can connect buyers to alternate lower-cost sources.
  • Cost of quality. Increased visibility and monitoring can decrease cost of quality. For example sensors can identify root errors and drive process improvements that dramatically increase first pass yields.
  • Cost of service. Digitally gathering data from products and/or users and sending it to remotely located, skilled technicians decreases the cost of service and the cost of transportation of service technicians.
  • Cost of transportation. Automated warehousing robots and driverless trucks utilize analytics and dynamic routing to improve efficiency and reduce accidents and errors.

Greater asset efficiency:

  • Idle assets. The sharing economy can be leveraged for high cost and under capacity assets. For example, a company that only operates two shifts per day could sell its third shift to another company.
  • Supply chain downtime. Predictive maintenance can maximize performance and reliability of manufacturing devices.
  • Idle workforce. Sensor-enabled labor monitoring can optimize workforce assignments and scheduling.
  • “Click-to-ship” time. Automated inventory management can dramatically increase supply chain efficiency.
  • Error propagation. Augmented Reality can assist in maintenance and reduce error propagation and rework costs.

Meeting shareholder expectations:

  • Geographic responsiveness. Increased connectivity enables rapid responses to unexpected issues, such as natural disasters or supplier shutdowns.
  • Brand responsiveness. Increased insight to customer concerns or issues enables fast responses to events like food contamination outbreaks.
  • Proactive risk mitigation. Increased transparency demands proactive assessment of risks and fast response to customer demands.

Industry 4.0 and the digital transformation of supply chains

Industry 4.0, the fourth industrial revolution, is characterized by new technologies that blur the lines between physical and digital worlds—driving real-time access to new and existing data sources. This digital revolution is likely changing the way products are designed, created, and delivered to customers—and it has tremendous implications for the supply chain.

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