Why Supply Chain Is The Next Digital Transformation
Supply chain inefficiencies cost retailers more than $1 trillion in lost sales each year. While digital transformation has been rapidly adopted across marketing, sales and customer experience, supply chain is one discipline that continues to lag. The average supply chain had a digitization level of 43 percent, according to a 2017 McKinsey report. The disruptions product companies experienced during the Covid-19 pandemic remind us how critical supply chain is to operating a business effectively. Disconnected and outdated manual processes can’t keep up with supply chains that are increasingly global and complex. The McKinsey report above notes that, “companies that aggressively digitize their supply chains can expect to boost annual growth of earnings before interest and taxes by 3.2 percent–the largest increase from digitizing any business area–and annual revenue growth by 2.3 percent.” For small and medium-sized businesses (SMB), digitization numbers are far less. According to Deloitte, SMBs account for approximately 45 percent of all U.S. GDP, yet only 23 percent use software to connect sales with supply chain operations. To maximize operational efficiency and consistently deliver on time, on quality and on cost, businesses must take steps toward modernization. Read more at Inc.
