Digital decision making changing face of supply chain
Working conditions and customs have changed more in the past two years than in the previous 20 put together, with hybrid and remote working becoming a permanent feature across most sectors.
But it’s not only where people are working that has changed, but also how. Zoom calls instead of face-to-face meetings is an obvious example, but more fundamental than this is an ongoing change to how decisions are made.
Digitised decision-making technology is often part of digital transformation programmes, but what does this mean for the supply chain workforces of the future? What problems does it solve? Why is it needed, even?
One man well-equipped to answer these and other questions around digital workforces is Fred Fontes, Head of Growth with Aera Technology, a cloud-based solution that facilitates better business decision making.
Asked if digital decision making can make hybrid supply chain workforces more efficient, Fontes points out that, even before the pandemic, many teams “relied on phone calls, emails, and spreadsheets to make day-to-day decisions”.
Hybrid working brings more complexity
From Fontes perspective, hybrid work brings more layers of communication – such as chat apps, video conferencing, collaboration tools. These, he says, add both complexity and delay, and as such, organisations are struggling to keep up with the number of decisions they must make daily.
“Yet, when a company digitises decision making, the context for a decision is captured, as well as its outcome,” he says. “Transactional systems are updated automatically, and each decision becomes part of the data model used for future recommendations.”
“So by removing manual steps and recording the context of decisions, digitisation helps teams work more efficiently, regardless of whether they’re in-office or remote.”
When it comes to putting digitised decision-making solutions in place, Fontes reveals that companies’ approaches vary. Many supply chain teams will “start by evaluating the challenges they face and identifying where processes and actions can be streamlined or automated”; others “start by addressing one area of complexity in their business where decision making is requiring a lot of time”, such as with processes, data models, and spreadsheets – all areas that lend themselves to automation.
He says a good guideline is to “prioritise specific areas with high strategic impact and less complexity, and then build a roadmap to address the other challenges”.
Digitising decisions ‘doesn’t mean replacing existing technology'
Fontes continues: “It’s important to note that digitising decisions for a specific supply chain process does not always require replacing existing technology, or choosing an alternative business intelligence or planning system.” He points out that data quality, data access and other integration issues “won’t delay decision intelligence projects”.
Fontes stresses that decision intelligence platforms are designed to complement existing enterprise resource planning and other core systems, without impact to data.
“Deployment,” he says “can focus on one challenging area, after which companies can gauge the results, then evaluate the next priority on their digital decision roadmap”.
“Digitising and automating decision making can have a broad, transformative impact. My best advice is simply get started. Don’t get left behind as these innovative technologies continue to evolve and deliver impactful results for supply chains.”
One of the big problems for any business these days – especially one looking to digitally transform itself – is the Great Resignation, closely linked to the newly-discussed phenomenon of ‘quiet quitting’, both of which have seen people leave jobs and switch careers at an unprecedented level.
Are digital tools able to help prevent the knowledge loss that comes with such churn?
Great Resignation faces firms with staffing headache
“The impact of the Great Resignation and the growing gig economy have put new pressures on supply chain teams,” says Fontes, a former Associate Partner at McKinsey & Company. “The demand for fast, accurate decisions is beyond the ability of the smaller pool of experienced decision makers at most companies, and that was the case even before those disruptions. This is creating an urgent need for supply chains to find alternative solutions to manage their business.”
He says that, as workers retire or move on to new roles, their knowledge and decision-making experience is lost.
“However, it’s possible to digitise that knowledge so that the decisions those lost team members have made continue to inform the organisation in the future,” says Fontes. “With digitised decision making, supply chains can manage change by capturing the knowledge and historical decisions made by their experienced workforce throughout their enterprise.”
Fontes says that decision-intelligence platforms can collect data, apply decision logic, and either execute automatically or present recommendations to a human operator.
“As those team members interact with the recommendations their knowledge of the business is captured, so that it can be used for future decisions, creating a cycle of continuous improvement,” he explains.
“With digitisation, decision making is no longer constrained by people. By automating the decision-making process, you can make 10,000 decisions a day if you need to. Team members can be in the loop for the high-value, strategic decisions – which typically account for roughly 20% of those that need to be made.”
Lost knowledge is big problem for businesses
Protecting against knowledge loss in the face of departing staff is one challenge of the Great Resignation and ‘quiet quitting’. Another is persuading people to stay, and Fontes believes digital tools can help with employee empowerment and retention. “Technologies that digitise decision making not only retain knowledge from retirees or other decision makers who’ve departed, they also deliver employee empowerment and retention in a competitive labour market.”
He adds: “By optimising, orchestrating, and accelerating decision making, companies can enable more decisions made by fewer people. Employees also gain an increased sense of doing their jobs successfully as they spend less time on repetitive and transactional activities that are better suited to machines. Instead, they’re able to focus on thinking creatively, beyond the data. They can build better strategies and stronger business relationships.”
Fontes believes, too, that the evolution of digital decision making has the power to change talent recruitment and acquisition. “As decision intelligence becomes the norm, people will want to work for companies that are adopting these technologies.”
And it is technology he says can be applied with equal effectiveness to every function across any type of supply chain, including consumer packaged goods, food and beverage, healthcare and life sciences, technology and manufacturing.