Effects of the Digital Transformation on Businesses - Helpful Use Cases

Today digital transformation is a well-known concept. The growing connectivity of people, machines and even businesses has changed the demands of the markets. In order to keep up and stay competitive, business have to adjust to these demands by digitizing their processes and business models. But the digital transformation also holds a lot of new opportunities to grow or even establish new branches of business. Therefore companies should embrace innovation, ensure effective customer engagement, bring in fresh ways of thinking, and empower a company to make well informed decisions as a collective whole.

Many businesses have already begun to transition themselves towards digital transformation as they realize that it is not something to be left for tomorrow. With this series we want to illustrate, on industry specific use cases, how businesses can re-imagine their business models, processes, products, and services, for the purpose of achieving the benefits of the digital transformation. In order to do this organizations are increasingly looking at technology enablers like Big Data, Mobility, Collaboration, Analytics, and Cloud Computing to adopt.

Use Case Business Intentions

Let us begin with the first digitization use case within the consumer product industry: Real-Time Supply Chain Visibility

In order for a business to achieve real-time supply chain visibility, it needs to move from manual to a system-based production planning and scheduling, automate sales order management, and enable traceability and visibility of the operations and shipments within and outside the organization. By leveraging Big Data and analytics capabilities, the company can analyze the demand for production, delivery and process times, and can create event based notifications for better monitoring of the supply chain. So in this case Big Data and analytics are the technology enabler, which will help enterprises to realize the digital transformation goals.

FMCG customer example

To make this use case more relatable, we will illustrate it on an anonymized fast moving customer goods (FMCG) customer with their before-and-after situation.

This company is an example of digital transformation done right with Big Data and analytics as technology enablers. The idea was to track and analyze real-time data to re-imagine the process of work so that it helps in cost reduction and effective process flow.

Before Digital Transformation

The purchase data across various auctioning platforms was captured manually with buying prices varying significantly. The lack of real-time purchases visibility hindered the mid-market price interventions. There also was a manual production planning process with large planning cycle times. And time stamps for various processes were captured in disparate systems, which did not facilitate backward calculation of customer 'need by' date. The company needed a large amount of time to demonstrate traceability to customer. As they were not able to track and monitor warehouse utilization in real-time, they had a manual monitoring for decision making, which is not the most efficient way to go, of course.

In a digitizing environment, these circumstances posed a threat to its position in the market aor even to the company's existence overall. Hence, they saw the need to immediately transform themselves digitally. The need for change is obvious when we consider not being able to work in real-time or working with a great analytics tool to make the best decisions based on accurate information. Overall the time-consuming, error-prone processes of sourcing data for planning in this company needed to be reimagined.

After Digital Transformation

They started off with live tracking and reporting to facilitate quick response to changing situation for cost benefits, reduced decision time and improved opportunity capture. Next was a better monitoring of the supply chain by event based notifications in case of any schedule non-conformance for the purpose of taking corrective measures. Also they facilitated traceability within and outside the organization through a single lot traceability report.

Immediate Results

When undergoing a digital transformation the results are instantaneous. In this example there is a big list of things that brought business benefits:

• Ÿ INR 120+ Million saved by optimized sourcing
• Ÿ Reduced the time lag of price visibility from 1 day to 20 minutes
• Ÿ Improved bale to box time
• Ÿ 5% improvement in on-time delivery performance (OTIF levels)
• Ÿ Speed improvement by over 100x for root cause analysis: traceability reports will now be ready in <30min (earlier it took 18 hrs)
• Ÿ Optimized the warehouse utilization and reduced supply chain costs by INR 4.2 million

This is only one example of many more to come that don't leave a doubt that the digital transformation is the next step for businesses to stay competitive and take the right path towards the future. Stay tuned for even more digitization use cases with hands-on business examples.

So stay tuned for more examples and follow me via @SDenecken