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Digital Supply Chain – Explained

A digital supply chain’s foundation is built on web-enabled proficiencies. A lot of IT companies use a combination of paper-based and IT-enabled processes. However, a genuine digital supply chain is more than just this mixed model for the capitalization of connectivity. It is an integrated system that has the capability to produce smart components.

The main aim of the digital supply chain is to allow insights for better efficiencies and facilitate better profits. In addition to the sustainability of waste. Companies that work through a digital supply chain have better resources, assets, and people. Moreover, their inventory is better because they can cater to needs at any time. It also reduces the overall expenses because they respond to manufacturing and transportation risks proactively. Furthermore, when a company is hundred percent digital, they can save in every area, for example, resources, time, expenses, and environmental footprint.

The process of a digital supply chain is such that it monitors the inventory levels, interaction of customers, carrier locations, and equipment in real-time. Furthermore, they use this information to plan and execute a high-level performance. 

The following play a vital role in the digital supply chain

  1. GPS tracking
  2. Radiofrequency identification
  3. Wireless sensor networks
  4. Location-based data

The integration of cloud technologies with Web services unifies the information and processes. It creates more efficient collaboration and trading partner capabilities.

Building a digital supply chain isn’t easy. It requires properly planned strategies and organizational skills. Not putting in enough effort can lead to data duplication and inefficiencies.

Traditional Supply Chain vs Digital Supply Chain

Traditional supply chains work on the strategy of planning and reacting, whereas digital supply chains predict and prescribe actions.

Traditional supply chains work on rules that are historical, which makes them tremendously static. However, the digital supply chain functions in real time; it can adapt to changing circumstances. The difference between the two is vast. The former is linear, and the latter is based on networking.

Supply chain digitization relies on information technology and operational technology. Moreover, the system is also integrated, balancing profits and service levels. The traditional supply chain depends entirely on standalone systems.

Supply chains can encounter problems and unwanted effects, which can be a lot of work if traditional. The majority of companies need to perform regular resilience assessments and list the solutions manually. But, for the digital supply chain, the quality control data is shared. It can allow the companies to resolve the issues right away without the requirement of preplanning.


It is very beneficial for companies to incorporate digital supply chain management into their business. The technology will open doors to tremendous opportunities, evolving the world of digital supply chains.

However, a lot of the companies are still working on traditional aspects and switching to digital can take some time. But it isn’t wishful thinking for companies to become technologically pro in the future. Moreover, these digital technologies will be around for some time, so companies can evolve based on their convenience.

In addition, it is important to understand that the skill set needed for Digital Supply Chain is different in contrast to the traditional methods.

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