The world today is a different place. There are officially more mobile devices than people. And with increasing frequency, we use these devices to manage our lives, to shop, to pay for things, to find restaurants and hail cabs, and to network with our friends and family. Many of these same technologies are now making their way into the enterprise – transforming the way we work. Business networks, for instance, are changing the way we discover, connect and collaborate with our trading partners. The supply chain is, in essence, becoming more digital.
And this is not only driving greater agility, efficiency and innovation, but creating business advantage for companies that are on board with the trend. In fact, research shows that companies who have embraced the digital world and execute digital strategies are seeing real shareholder and stakeholder value. Value creation is significant, with +9 percent revenue creation, +26 percent impact to profitability, and +12 percent market valuation.
In this slideshow, Ariba, a SAP Company, has identified five tips to help you enable a digital supply chain and create value for your business.
The Digitized Supply Chain
Click through for five tips organizations can use to build their own digital supply chain and create value for their business, as identified by Ariba, a SAP company.
Understand What Digitization Can – and Can’t – Do
Digitization is the first step most companies take to improve the efficiency and effectiveness of their supply chain operations. And while it’s a good start, automating processes such as procurement, orders, invoicing and payment doesn’t in and of itself create value. In fact, it can often lead to doing bad things, only faster.
Take invoicing. Despite advances in technology designed to simplify and enhance the process, it remains flawed. Accounts payable teams still spend inordinate amounts of time and effort processing paper invoices. And current studies show that one in five of these invoices still contains an overcharge or other exception. Why? Because many companies are attempting to tackle the problem through digitization alone. When it comes to invoicing, creating electronic documents isn’t enough. In order to improve accuracy, eliminate errors and rework and ensure that only valid and approved invoices reach AP, companies need to combine automation with rules-based processes to ensure that e-invoices, just like their paper counterparts, are validated when suppliers submit them. Good solutions do this automatically.
Revolutionize the Process
Where the real value of digitization lies is in enabling new processes that drive more collaborative, intelligent and transparent ways of operating. Supply chain management isn’t a set of discrete tasks performed in silos, but a connected one carried out across many functions and geographies. And the key to executing it well is in connecting multiple parties and systems using a common platform that supports the entire source-to-settle process and provides a gateway for collaboration both within and beyond the enterprise on a global scale.
Every day, billions of consumers around the world use social networks to manage their personal connections – to shop, share and consume. Why? Because they make things easy. The same is true of business networks, which provide a single platform from which companies can manage their customers, partners, people and money – and collaborate around key business processes, from finance and procurement to sales, marketing and IT.
With a few clicks, you can shop for the goods and services you need to run your business, order and have them shipped. When it comes to payments, you can kill the paper checks and transfer the funds electronically. Or you can review your receivables and decide whether you want to offer a discount in return for early payment.
You can view and manage your spend across all major categories and find opportunities for savings. You can manage your entire workforce – temporary and full-time employees alike – and empower them to do their jobs anywhere, anytime, from any device. And you can engage your customers across multiple channels and create personalized experiences along every step of their journey that delight and keep them loyal.
Companies today operate on more flexible models that require them to rapidly assemble resources on a project basis to address the biggest challenges of the moment and disassemble them just as quickly to be more agile and profitable. They are increasingly looking externally for innovations – whether it’s tapping call centers and third-party logistics providers to enable new models for customer engagement; or outside design partners and knowledge workers for product and service innovations; or contract manufacturers for assembling products in new and more efficient ways. These new business models demand higher levels of agility and knowledge frameworks. And the way to enable this is through dynamic digital communities like business networks that can connect you with the applications, intelligence and partners you need to discover, connect and collaborate in the simplest possible way.
Like their social counterparts, business networks house incredible amounts of insights and data that can be used to learn in context and act in smarter ways. You can, for instance, access performance ratings on potential trading partners along with recommendations from the community to determine who to do business with or detect risk in your supply chain. You can combine in-the-moment purchasing data with historic trends to predict stock outs before they happen and direct replenishment. Or gain real-time insights into invoice approval status to more efficiently manage your cash. Engage in these communities and unleash the power of this information to optimize your supply chain decisions and accelerate innovation and growth.
The digital economy is real, and it’s here to stay. Digital supply chains are the onramp to innovation and success in this economy and if you want to be among the winners, you need to get on the highway and go fast. Start today by reimagining your supply chain. Develop digital strategies that allow you to proactively evolve ahead of the competition. Employ comprehensive solutions that support the entire source-to-settle process and create value for all parties involved in it. Don’t just think about the future, see it and shape it to your advantage. In doing so, you’ll deliver your organization to new worlds of excellence.