From fragmented thinking, to out of date infrastructures and poor processes, there is a long list of reasons why supply chains can become unsustainable. But, according to a luxury packaging provider, digitalized data is set to transform the industry in a big way.
With over 30 years’ experience in the supply chain and distribution industry, Stuart Gannon, commercial director of Delta Global, a packaging distributor in the luxury retail sector, was keen to point out the impact these digital changes might have on the industry.
“The more mindful the consumer the more analytical we have to be in our approach to truly tackling environmental and ecological issues,” he said.
“Data gives us the ability to quickly spot and react to shifts in buying behaviors and stay ahead of the game when it comes to the sourcing of raw and sustainable materials, right through to tracking and improving the last mile journey of the goods.”
Stuart went on to highlight the main benefits that digitization will have on the industry as well as new challenges it will pose.
What are the benefits of data driven supply chains?
Data can enhance the delivery and distribution of goods, ensuring faster, more economic and more sustainable delivery, as well as reduce time consuming inventory taking.
“When you are data enabled, you will increase value throughout your entire supply chain. The production line becomes more customer focused and data helps us to address what’s happened in the past and flag up risks for the future.
“Better forecasting and stock control will inevitably help us reduce waste, improve traceability of goods in the manufacturing and delivery process and release any tied up working capital.
“Data can also optimize and maximize valuable assets such as waste throughout the supply chain, churning left-over materials into product such as paper handles and other accessories.”
What are the challenges?
While these revolutionary advances have clearly had a positive effect on supply chains, not everything will be quite so plain sailing.
There are fears that the automation of data could introduce new risks with no human input into the elements of the supply chain.
“Old-fashioned tracking systems and global supply chains can mean many businesses are failing to harness data in the right way.
“There are many elements to a supply chain, but without building strong and communicative relationships among all partners involved, brands will be restricted by their capabilities which will influence the service and product delivered to the end customer.
“Brands need to be aware of the risks false claims can have, while it is true that your end-product may be completely eco-friendly in its materials, if it was not made, sourced or delivered in an eco-friendly or socially acceptable way your risk any reputation your product once upheld.
“There are also challenges in which the flow of information can affect accuracy and speed. When dealing with global supply chains we must be alert of time-zones and how this can affect real-time data feeds if there are delays due to working hours overseas.
“We advise investing time in getting information displayed and shared in the right way which speaks to people across borders. It guarantees alignment in all functions end goal and what we are required to do in order to advance. Data should act as the fuel for bringing supply chain partners together.”
It can be hard to keep up with all of the latest developments in the world of digitalization. Particularly when buzzwords such as AI, blockchain and real-time data are dominating the technological sector.
So, what do these words really mean?
“Artificial Intelligence (AI) learns what the data means and assists how it’s used. Machine learning enables more data to be processed in one go, enabling efficiency and speed. Blockchain is the way to secure and transfer data, whilst real-time data is the ‘now’ and is much quicker to react to.
“Heralded as the next big thing is Robotic Process Automation (RPA), this could dramatically change the way supply chains work, introducing software which can communicate with other digital systems to capture and interpret data in order to process, manipulate and trigger a reaction.
“Then there is ‘big data’. This describes a large volume of data that is used to reveal patterns and trends depicted from human behavior and interactions.
“An example of where this is being used is in the retail industry. Here data is giving brands a greater understanding of consumer shopping habits and will make several improvements to their infrastructure and processes.
“Digitalizing the supply chain is a key area where retailers can ensure they continue to attract both new and existing customers.”
How important are relationships within the supply chain?
“Strong relationships and constant communication is paramount to ensuring all partners are invested in the same end goal.
“Businesses should take a holistic approach when managing costs, improving the quality of goods and tackling the volumes of secondary packaging waste that is generated.
“We look at ourselves as consultants as well as partners, analysing the methods, materials and designs suggested by the client and then advising on how we can better the sustainability aspect.
“Whilst some brands can source a beautifully packaged product made entirely out of sustainable materials, often corners are cut during production. This includes shipping around the world during different stages of the process.
“This results in a completely unsustainable end-product with heightened carbon emissions and more waste at multiple facilities – each costing you a pretty penny.
“Data can be difficult to read and huge volumes of transactional data in the wrong format is near useless.
“The information is only as good as the data entry and only as good as the people who are looking at that data. Therefore, good communication is vital and human intervention is still required to prioritize actions off the back of what the data is telling us.”
How else do you use data?
“We interpret our data visually, not just in terms of supply chain development, but also with the brands we create packaging for. We conduct in-depth research of the marketplace, studying the audiences we are attempting to reach, building an idea of personal profiles that analyses the end-consumer – their values and what defines good service and returnability for them.
“This integration between supplier and end-consumer influences the design process and deliverability of each project and is a much more people-led approach, making our clients stand-out among their competition.
“Data helps manufacturers to stay ahead when it comes to tracking where are product is in production stages and stay on target to make delivery or even beat it where possible
“Whilst business must onboard costs, in the long-run these will be reduced with less waste to get rid of and more profit from newly committed customers due to smoother services and selling or utilizing waste back into the supply chain.
“By introducing data-driven supply chains, we not only focus on the sale for today, but the sale for tomorrow.”