The quest to achieve end-to-end supply chain visibility continues to get more difficult as supply chains become increasingly globalized and fragmented. Fortunately, advancements in technology are helping companies to overcome these challenges and automate their processes. What hurdles still remain? Why is changing the status quo so important? How can technology help? What are the benefits of this digital transformation? Those are the key questions I discussed with Katie Paul, Director, Global Enterprise Solutions at Elemica, during a recent episode of Talking Logistics.
Hurdles to the Touchless Order
Given the progress the industry has made toward visibility and automation, I began our discussion by asking Katie what hurdles still remain. Katie pointed out that the goal posts are always moving when it comes to achieving a true touchless order. She cites the example of using OCR (Optical Character Recognition) technology to scan a purchase order. While this may be touchless, someone still has to review the scanned information for accuracy. “Have you actually validated if you have stock?” Katie asks. “Have you checked if the address is correct? Have you checked if the customer used the correct SKU? All of these things are still happening manually, so it’s not really a touchless order.”
“A true touchless order is one where you manage by exception, automatically handling stock allocations and customer delivery requirements,” Katie says. “The world is about working with consistent chaos. Technology can fix that gap. That frees people up to deal with the inconsistent chaos technology can’t handle. A true touchless transaction is end to end, fully processed, delivered on-time and in full. The reason I say transaction instead of order is that an order is more than a PO; it is also proof of delivery (POD), advanced shipping notification, and a package. With a touchless order, it’s making sure that you have everything you need in your virtual folder and that’s the journey many customers are working on.”
Changing the Status Quo
What has happened to supply chains over the past 18 months shows why changing the status quo is so important. I asked Katie what the negative effects are for those not automating and digitizing their supply chains.
Katie notes that supply chain is a change management business. Especially with the changes brought on by the pandemic, with changes in demand, people working from home and supply problems, it’s much harder to manage everything. Technology can help with this. “It allows you to achieve your goals as a business,” says Katie.
Katie remarks that companies sometimes worry about how technology will impact their customers. She says, “It shouldn’t. It should be business as usual. Everything should just flow through to their customers, who should only get better customer experiences.”
In terms of where to begin, Katie recommends starting with your largest volume customers because you know them best and you can anticipate their needs and use technology to readily address those needs. That frees up time you can spend with smaller customers to automate their needs and help them to grow.
The Benefits of Digitization
Katie mentions that one area where their customers often start this process is during a merger or acquisition where there is a lot to sort out. By digitizing the order-to-delivery process so that customers get their shipments on time, it frees people to focus on other challenges caused by a merger. She gives an example of a customer merging three divisions into one. They expected to need 18 additional people to handle this, but with digitization, they didn’t need any additional staff. By implementing a digital platform, this company was able to automate 80% of its order processing, including 100% of its top customers. And they could proactively work with customers who were not automated to help them migrate to digital processes.
Another example was a chocolate company who took four days on average to process an order due to many order variations. After implementing Elemica’s platform, that average dropped to four minutes. Katie also shared some examples of using the technology to aid green initiatives, especially with large customers.
The benefits of digitization are obviously there, but how should companies begin this journey? Katie shared some helpful insights on this, so I recommend that you watch the full episode for more details on everything we discussed. Then post a comment and share your perspective!