What is supply chain modernization?

Supply chain modernization refers to the improvement of innovation capabilities, fairness, safety, reliability, and sustainability in the new era in response to the increased instability and uncertainty of the international environment and the requirements of a new round of technological change. and digitalization to make the industrial chain and supply chain more adaptable to the requirements of China's new development stage.

Specifically, the industrial chain is a chain form formed between various industries based on certain economic and technological connections and spatial layout relationships. The main goal is to optimize the degree of economic and technological coupling, improve industrial development efficiency and development momentum. ; Supply chain is a chain form formed by enterprises around business development, product manufacturing or service provision, connecting the supply side, demand side or upstream, mid-stream and downstream enterprises. The main goal is to scientifically control operating costs, improve supply efficiency and ensure a smooth economic cycle. .

The idea may conjure up images of 3D printed products and drone deliveries, but real-world modernization is actually more fundamental. It involves integrating supply chains with data-driven technology to enable companies to make smarter logistics decisions.

The process of modernizing your supply chain

1. Dynamic inventory: Dynamic inventory ensures you maintain appropriate product availability across your retail and distribution centers, especially in supply-constrained situations Down. This approach helps you meet consumer demand thanks to granular distribution management and inventory tracking. It also reduces the operational burden on retail and fulfillment teams.

2. Profitability Insights: As consumer demands and shipping capabilities evolve, profitability insights are critical to balancing customer expectations with business efficiency. Consider profitability metrics at every step of the order fulfillment process to ensure resources are used efficiently and apply profitability insights to execution and delivery plans.

3. Real-time reporting and intelligent planning platform: Generate responsive data insights with real-time reporting and planning platform. This can flag operational bottlenecks and other logistics roadblocks through dynamic reporting capabilities and provide data insights in a way that is relevant and applicable to your procurement logistics team. However, McKinsey research shows that about 80% of companies still follow traditional sales and operations planning (S&OP) processes, with limited real-time decision-making or automation. It shows that there is still a lot of room for optimization in this aspect.

4. Service-based partnerships: Transform your supply chain by creating partnerships that are focused on strategy and service, not just cost efficiency. Prioritizing service in carrier and logistics partnerships will ensure more accurate sharing of data, greater stakeholder alignment and more reliable service in a context of uncertainty.

5. Sustainability Key Performance Indicators: Sustainable sourcing programs typically focus on cost and operational efficiency, but sustainable alternatives can significantly improve supply chain resiliency. Set sustainability KPIs in key logistics areas such as product design, material sourcing and freight networks. These metrics will help you keep up with consumer sustainability preferences and provide granular data insights that can be applied across your business operations.