Digital Logistics in Action: a New Age in Supply Chain Management
By Andrea Ricciarelli, Senior Director, Center of Excellence, SAP
Andrea Ricciarelli, Senior Director, Center of Excellence, SAP
Since the beginning, logistics has always posed challenges for supply chain managers, from monitoring stock levels to efficient customer delivery. We are living in a world where industry boundaries are blurring as companies look to reimaging and digitize their business. Today, companies of all kinds are moving into industry sectors previously shut off to them and competing for market share in new ways.
We see consumer products companies look to get closer to their end customers and moving from a wholesale model to a direct to consumer model. Nike, Adidas, Under Armour are selling now direct to consumer. The journey between manufacturer and end user is becoming more streamlined thanks to innovations in digital logistics. At the same time, on-line retailers are seeing the value of having complete control of the end to end supply chain and investing in logistics as customers are demanding same day delivery, and, in some markets, same hour delivery, like Amazon or Alibaba are doing in major cities around the world already.
Connecting Digitally to Perfect Reality
Innovative Technologies, such as Blockchain, Internet of Things, Big Data, AI and Machine Learning, Predictive Analytics are creating a customer-centric view that drives supply chain processes based on real-time customer demand. This enables supply chain managers to be responsive and flexible in their planning, increasing their visibility across the network of partners, manufacturing facilities, warehouses, distribution centres, across all the vehicles in transit with products and materials and aligning their stock levels with customer demand.
During SAP recent interactive learning seminar, increasing speed and efficiency in your Supply Chain through enhanced logistics and order fulfilment, we discussed the principles of these digital logistics in action with customers presenting their success story in the world of digital logistics.
First up to share their success story were the team from Caterpillar Distribution Services, in a talk led by their EAME Process Planning and Facility Engineering Lead Philippe Wingels. They talked us through the challenges of their warehousing, from storing a range of products with varying sizes and speeds to the diversity of their regional operations. What they needed was a focus on a global standard, helping to bring down development costs with a comprehensive IT solution. They enlisted the help of SAP, who implemented standardised processes across all of their regions of operation, real-time monitoring, and integrated information flows. The result was reduced costs and implementation thanks to a common strategy for warehouse implementation across America, Europe, and the Far East.
Caterpillar were not the only ones to benefit. Later, we heard from Schaeffler, global leading automotive supplier, who implemented SAP Yard Logistics at their European distribution centre to gain full visibility of all yard processes. This was the first live implementation of SAP’s Yard Logistics 2.0 and made use of IoT scenarios to speed up operations and save costs. With a core mission of managing and coordinating their yard traffic in an efficient manner, Schaeffler asked SAP to provide a global solution which could integrate different devices with up-to-date technology and offer a modern interface. A specific app, for both gate agents and security staff, has been used to give a real-time view of trucks in the yard and helping to streamline operations.
Transform your Business Model Today
Technology is here to revolutionise the supply chain, and not a moment too soon: thousands of supply chain managers are witnessing the true benefits of Blockchain, Internet of Things, AI and Machine Learning and more. Evolving the business, being flexible in capturing new opportunities, and being able to innovate (or disrupt) are all dependent on agile, responsive, connected supply chain management.