What's holding back Australia Supply Chain Operators digital transformation?

Keen to use new technologies to streamline processes and lower costs, many Australian supply chain operators are finding that a lack of strong leadership and vague methodologies are hampering much-needed digital transformation projects.

According to a recent survey, commissioned by FTS Group and Software AG, one third (32%) of Australian organisations are not reaping the advantages of digital technologies to transform their business processes and workflows. This is reflected in the many disjointed supply chains in Australia. While companies like Australia Post and Toll have progressed on their Digital Transformation, allowing customers to track packages from door to door, there are still huge gaps in visibility across many other supply chains.

The survey also revealed the key business challenges currently faced by Australian organisations that they are aiming to overcome through digital transformation projects. Topping the list is business agility, nominated by 52% of respondents, followed by cost efficiency (45%) and data capture and analysis (37%). With the advent of lower cost options for vehicle tracking, RFID and IoT, the building blocks should be available in the supply chain to provides more agility, cost efficiency and enhanced analytics.

However, many organisations have only started down their particular transformation path after experiencing digital disruption themselves. This may have come in the form of an existing competitor who is gaining market share through a new initiative, or a new entrant who is completely changing the rules of the game. Think Amazon Prime and their impact on the local market.

Once supply chain operators realise changes have to be made, a business then needs to decide whether those changes relate only to IT systems or must be put in place more widely across the organisation as a whole. In most cases, the latter will be true.

For transformation projects to be successful, business goals need to be clearly mapped with IT investments to ensure the required changes support all teams. An organisation may have a stated goal of doubling its revenue in the next three years, but this cannot be achieved unless there is significant co-operation between the business and IT.

Digital transformation is a process that is never finished, but it shouldn’t feel like IT is constantly running on a hamster wheel. As the number of technology projects continue to proliferate into every corner of a supply chain business, organisations can’t simply continue to work the way they always have.

Instead organisations need to rethink how they’re tackling these projects. The organisations that will truly succeed in the digital age are the ones that are finding a way to reuse assets, leverage emerging technologies, consider the human impact of those technologies, and enable lines of business to self-serve so IT doesn’t have to bare the full brunt of digital transformation.