Design to Operate: Connecting the Supply Chain Digitally

digital supply chain

(3 minute read)

No matter whether you are a manufacturer, retailer or wholesaler, having an optimized supply chain is critical to being a successful and growing company. It can also be a competitive weapon in the digital economy, but not if you continue to use the traditional elements of supply chain planning and execution.

In order to meet the demands of the digital economy, manufacturers must redefine their supply chains in a way that digitally extends to product innovation, planning, manufacturing, execution and service.

This is where the concept of Design to Operate comes in. It’s an approach that seamlessly connects business processes across the entire product lifecycle to break down silos and provide visibility across design, planning, logistics and operations.

By connecting every aspect of the supply chain digitally, manufacturers can perfect their operations and reap benefits in several areas.

  • Capture customer requirements early. Having early visibility to monitor trends and innovate in the direction that customers want can be exceptionally powerful in the product requirements phase. In order to do this, manufacturers have begun to build smarter, Industry 4.0-enabled products and assets with embedded sensors to capture real-time data once the product is running in a live environment.
  • Plan with visibility across silos. This involves synchronizing planning processes and tools to break down data silos quickly, while running simulations for better decision-making, faster planning cycles and real-time response to change.
  • Manufacture with flexibility, speed and efficiency. Sophisticated digital supply chain capabilities and greater connectedness can help manufacturers increase shop-floor visibility, identify process bottlenecks and manage operations with greater agility. This approach also facilitates smart factory capabilities that connect business data to manufacturing processes. The end result is that rigid production lines are transformed into flexible manufacturing cells – making it possible to shift from mass production to mass individualization.
  • Deliver on time. Industry 4.0 capabilities can help manufacturers to streamline logistics and help ensure better delivery experiences. For example, connected vehicles can optimize delivery routes based on real-time weather and traffic conditions as well as support real-time tracking and monitoring of the shipment. Next-generation warehouse technology that leverages robotics and augmented reality to assist staff can be used to increase productivity and ensure faster delivery of goods to customers.
  • Operate with new business models. By creating digitally connected products that plug directly into the supply chain, manufacturers have the ability to change their business models to a services orientation. The manufacturer takes ownership of the product throughout its entire lifecycle and charges the customer for usage, uptime or some other metric. To support this, products must be smarter, with sophisticated monitoring capabilities designed to anticipate potential failures.

By making sure data and work flows easily across functional silos, manufacturers gain greater flexibility and consistency across processes, and this leads to reduced financial and operational risk and higher rates of customer satisfaction.

To learn more, download our white paper, How Industrial Manufacturing and Components Companies Can Compete in the Digital Age.

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Reference: Leveraging an Intelligent Digital Supply Chain, IDC white paper sponsored by SAP, March 2019

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