The Digital Supply Chains Missing Link: FOCUSIntroduction The digitization of the supply chain is one of the major value and growth opportunities for businesses today, with the potential to make a significant difference to their performance and future prospects. We surveyed supply chain executives at more than 1,000 organizations across consumer products, manufacturing, and retail. Our aim was to understand the digital initiatives they are adopting, the benefits they are deriving, and the ways in which they are transforming their supply chains. Business leaders recognize the importance of supply chain digitization. Digital supply chain and logistics automation is the top funding priority for businesses worldwide, with investments in transformation reaching $93 billion in 2018. 1The worldwide revenue of supply chain management software organizations crossed $12 billion in 2017, with growth running at 13.9% for 201617. 2 But, are organizations able to turn this significant opportunity into reality and deliver a return on this significant investment? We have found that, while organizations realize the importance of investing in supply chain digitization, they are lacking one crucial ingredient strategic focus. This absence of focus is preventing most organizations from scaling up their digital initiatives. Our research focuses on the following areas: 1. The strategic importance of supply chain digitization 2. How successful organizations focus only on strategic initiatives and deploy them at scale 3. A shortlist of key use cases that can help focus organizations efforts and investment 4. Key recommendations for a successful supply chain digitization. 2Digital supply chain initiatives use digital technologies to optimize operations across the entire supply chain by enabling connectivity, data management, insights, and smart automation. When we refer to digitization of supply chain, we refer to both: Taking a process or task that is performed manually or offline today and delivering it more efficiently with digital tools Using digital processes and data to make something more effective and consumer centric. The benefits of supply chain digitization can be wide- ranging: cost savings, improved customer satisfaction, or even the launch of an entirely new business model. For example, Amazon is looking to roll out its drone-based “prime air” program to deliver customer shipments within 30 minutes. This will reduce the operational costs of last-mile deliveries and improve customer satisfaction. Moreover, it will also open up opportunities for new business models for example, charging fees to customers for this sub-30-minute delivery or letting other retailers pay to use prime airs infrastructure. What are digital supply chain initiatives? Source: Capgemini Research Institute. Figure 1. Initiatives for digital supply chain Research and Development Planning Production Procurement /Sourcing Distribution and gistics Maintenance /Equipment ServicingInternet of Things Business Intelligence Advanced Analytics and Articial Intelligence Robotics Automation 3D printing/ Additive Manufacturing Mobility Blockchain Augmented Reality Virtual Reality echnology Enablers Robotic Process Automation 3The strategic importance of supply chain digitization Nearly two-thirds (63%) of the organizations we surveyed say that their management realizes that supply chain digitization is a process that is continuous and takes a long time. Boeings supply chain provides an illustration of why so many recognize the complexity involved in digitizing an organizations supply chain. Its worldwide manufacturing facilities receive around three million parts daily from some 5,400 suppliers. 3 Despite the complexity, supply chain digitization is at the top of many organizations list of strategic priorities. Half of the organizations we surveyed describe it as a top-three focus area (see Figure 2). One in two organizations say supply chain digitization is one of their top three priorities at an organization level Source: Capgemini Research Institute, Digital Supply Chain Survey; AprilMay 2018, N=1,001 organizations. Figure 2. Prioritization of supply chain across sectors and geographies 53% 50% 49% 47% Manufacturing Consumer Products Retail Average Supply chain digitization is one of the top three organizational priorities - by industry 4 The digital supply chains missing link: focusRob Burnett, the CIO of Global Supply Chain AprilMay 2018, N=1,001 organizations. 50% 58% 56% 54% 53% 52% 46% 46% 42% 39% United Kingdom Italy Netherlands Germany United States Sweden India Spain France Average Supply chain digitization is one of the top three organizational priorities - by countries Our management was a huge proponent of investing in the digital technologies for supply chain and that really drives things.” Rob Burnett CIO of Global Supply Chain & Engineering, GE Transportation 5