5 Steps to Begin Your Digital Supply Chain Transformation

September 20, 2019
The logistics industry is changing rapidly. Increased expectations from customers — both in the B2C and B2B space — demand fast and flawless service at cheaper rates.
 
To execute, shippers know they need to leverage both technology and human expertise throughout their supply chain operations.
 
As we revealed in our original research study, Technology + Humanity: Striking the Balance in Your Business, shippers and carriers of all sizes agreed the optimal balance between technology and human expertise across supply chain tasks is 60% handled by technology and 40% handled by human expertise. 
 
Understanding your ideal balance is one thing — achieving it is another. Regardless of what your optimal ratio is or where you are on your journey, you need a plan to get to the next phase of your evolution. 
 
 
To help inform your strategy, we pulled insights from our research to create concrete next steps for shippers just starting to modernize their supply chain.
 
 
Not sure whether your business favors technology or human expertise in supply chain operations? Take our 2-minute assessment to find out

 

Step 1: Start the conversation.

The first step is the most straightforward. Work with your logistics and supply chain leadership to critically evaluate your strengths and weaknesses.
 
What are you doing well and where can you replicate best practices? Where do you need the most help? Is it due to a lack of tech tools, human expertise, or both? What needs to be prioritized in the short-term if you’re going to continue to grow as a business in the long-term? 
 
Considering your biggest challenges (and how well-equipped you are to deal with them) is a good place to start. Here are what 200 other supply chain leaders identified as their biggest challenges:
 
 
The supply chain function does not operate in a silo — it is connected to every part of a business. Once you assess where you are today and have a rough idea of where you want to go, identify and engage relevant stakeholders across the business to help guide you.
 
Start a steering committee and sync your priorities with executive leadership. Secure IT’s input on your technology strategy. Talk to human resources about the skill sets you need to refine or recruit.  
 
 
With a thorough evaluation of your supply chain through a technology and humanity lens and an open line of communication with key business stakeholders, you’ll be in a good place to start evaluating potential technology solutions.
 
There are hundreds of logistics technologies — keep your biggest challenges and priorities in mind and research tools that meet those needs. Use your steering committee as a sounding board.  
 

 

Step 2: Begin with the basics.

No two supply chains are alike — every technology and humanity solution will vary. Though you’ll need to investigate what’s right for your business, there were a few tasks where shippers favored technology, people, or a combination of both.
 
Look at these areas in your own business first and consider whether you need to invest in more digital solutions, more human expertise, or leverage a greater combination of the two. 
 
 
Keep in mind that out of 13 supply chain tasks, shippers did not think a single one should be 100% human or 100% technology — "both" was consistently the most frequent choice. Even these predominantly human or technology tasks should have some blend of both. 
 
For instance, 55% of shippers preferred human interaction when communicating with a customer. Based on that figure, shippers clearly believe it’s important to have trained people ready to handle relationship management tasks.
 
Though people should take the lead in relationship management, there is still plenty of room to integrate chatbots, self-service platforms, API connectivity, and AI solutions for routine tasks, empowering people to lead more strategic communication.     
 

"Technology is the backbone on which industries are made. It plays a big role in organizing, maintaining, and executing plans. Humans still run things though, and it's imperative that we don't fully rely on technology, as we need to continue to grow, develop, and be responsible for our actions."

-VP/Chief Executive of an $800M+ organization from our survey

Our study also surveyed shippers about their key technology platforms. If you aren’t utilizing most or all of these core tools, consider making the investment. 
 

 

Step 3: Call in the experts.

Not every shipper is going to excel at everything — and that’s OK. Consider some of the weaker areas from your critical assessment and determine whether you want to commit resources to building up competency internally or looking outside for help. 
 
Outsourcing can be a fast, effective way to gain efficiency while freeing up your people to focus on your core business objectives. Here are some key areas where shippers are turning to outside help according to our survey. 
 
 
Regardless of size, shippers leverage third party suppliers to improve efficiency. That said, as businesses scale up, they tend to outsource a greater portion of their supply chain tasks. 
 
 
See how Pregis, a leading manufacturer of packaging products, used an outsourced solution with Coyote to modernize its supply chain.   
 
 
 

Step 4: Combine technology and human expertise to forecast. 

In our study, we asked shippers to provide their top expectations when selecting a new platform. 45% expect their technology investment will help create more accurate budget forecasts; this was the number one expectation. 

We also asked shippers what technology solutions they want, but do not currently have. 51% said better freight market forecasting tools; this was the second overall choice behind advanced AI solutions.  

These two competing statistics tell us that though shippers expect technology investments to give them better insight, there is still room for improvement. 

"We use technology to improve efficiency in some processes, but when building a long-term strategy, human capital is still unbeatable."

- Director/Manager of Procurement, $800M+ shipper with a 45:55 tech-to-human ratio

Though it's a technical, data-based task, creating a supply chain forecast can be as much of an art as it is a science. To build the most accurate forecasts possible, shippers combine human expertise — informed by a solid understanding of market conditions — with technology tools.

 

Step 5: Keep up with new solutions.

Supply chain technology is evolving every day. New solutions — and challenges — are constantly coming to market. 31% of shippers in our study mentioned keeping up with the latest technology solutions as a top challenge, ranking fourth overall.
 
To create and execute your technology and humanity strategy, you need to stay informed on industry trends and new technology. 
 
Savvy supply chain leaders use a variety of sources to get different perspectives. Here are the top sources that shippers utilize to stay current:
 
 

In Summary

The digital transformation is happening throughout the logistics industry. Shippers of all sizes, in every vertical, must evolve. That means new technology, but it also means more — and more skilled — people.
 
In summary, here are five takeaways from our original research that you can use to guide your strategy as you start balancing technology and human expertise in your supply chain. 
 
1. Start the conversation.
2. Begin with the basics.
3. Call in the experts.
4. Combine technology and human expertise to forecast. 
5. Keep up with new solutions. 
 

Want to learn more about balancing technology and humanity in your supply chain?

Read and download the research report to see the full results.

READ RESEARCH REPORT

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