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Supply Chain

Supply Chain Digitalisation

Management Challenge

BY RICHARD MARKOFF AND RALF SEIFERT

As part of the broader Industry 4.0 requirements using a SaaS cloud platform about the viability of the potential
trend, the digitalisation of supply provided by a niche vendor. It seemed to vendor, the IT team declined to assist
chains is happening quickly. Much be a perfect solution to the vexing chal- in prospecting other vendors. They
of the attention is centred on inno- lenge of coordinating the vast amounts also advocated strongly for using a
vations like cloud computing, of planning data for thousands of items similar but less performant function-
software-as-a-service (SaaS) and with a large, diverse vendor base. ality offered by the company’s large
advanced analytics. But there There were understandable ques- enterprise system provider that was less
is another aspect to this rapidly tions about potential improvements in tested and more costly.
changing landscape: companies staff productivity, inventory and reac- In the end these differences were
must rethink their IT management tivity that fed into the business case. But overcome, the project was implemented
approaches, from their purchasing one challenge was not anticipated, and successfully with the original vendor
strategy to the interaction between it nearly scuttled the entire initiative – and all were proud to have contributed
IT and business processes. the company’s internal IT department. to an early instance of supply chain
The IT team was reluctant to move digitalisation. But the initiative revealed
Exciting New Solutions, forward and raised some valid ques- an important dynamic that warrants
Unexpected Obstacles tions. The cloud was new to them, and PRUH UHÁHFWLRQ 7KH ,7 URDGPDS IRU
A few years ago one of the authors, a they raised data security concerns; they sourcing and procuring solutions to
supply chain director at a large multi- also feared that the small, privately held cover business processes has to adapt
national company, found himself YHQGRU PLJKW QRW EH ÀQDQFLDOO\ YLDEOH to the advent of supply chain digitalisa-
championing an innovative digital supply DQG LQVLVWHG RQ DFFHVV WR LWV ÀQDQ- tion. IT management strategies that seek
chain IT solution for vendor collab- cial position. In fact, their posture to limit the number of vendors, or do
oration. The goal was to better share became less constructive as the project not foster virtuous iterations between
projected forward material production progressed. Despite raising questions evolving business needs and potential

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