"Software is eating the world." Marc Andreessen coined the phrase in a celebrated essay published in 2011. For me, Andreessen captures the essence of the disruptive and transformational impact of digitization in this statement. His article embodied my feeling that the 21st century would be completely different than the 20th century. More than 6 years later, this phrase rings more true, compelling companies, regardless of their industry, to rethink their business and operating models for the digital age. As the CEO of a software company operating in the supply chain analytics space, the article made me realize the natural role our company should play in this transformation. In this article, I will summarize the effect of digitization on supply chains, and discuss why I believe that self-enabling teams is key to succeed in this digital age.
Changing course to embrace a new paradigm shift
We are in the midst of a transition from the 20th century industrial age paradigm to the 21st century digital age paradigm. And we are only at the beginning of this transition. We haven’t seen the full force of disruptive business and operating models and there is no doubt that many more will keep emerging. The intellectual power of analytics, artificial intelligence, and machine learning will grow exponentially and profoundly affect how we live and work. The informational power of big data, of public data, and the computational power of the Cloud will continue to evolve beyond expectations, urging us to harness these resources to drive innovation.
We are only beginning to see the impact that digital transformation will have on our human power as well. This will demand the creation of new and higher levels of personal development and organizational effectiveness.
In the supply chain context, we see the emergence of Industry 4.0, a new industrial revolution driven by the application of digital technologies (such as IoT, Advanced Analytics, Artificial Intelligence, Self-driving Vehicles, and 3D Printing to name a few) in manufacturing and supply chain processes. As a result of this revolution, operating models are shifting:
- From a focus on standardization and ‘mass’ needs, to fit for purpose and individual needs
- From a transactional supply chain operating model, to a value-based operating model
- From cost efficiency to the business effectiveness of the supply chain
- From linear plan and control, to agile sense and respond
- From information disclosure, based on position, to information transparency, based on purpose
- From supply chain management as the seat of decision making power, to the front-line supply chain worker as change agent
To meet the demands of this digital supply chain transition, companies need to revisit and renew their software tooling. But tooling in itself will not drive the success of a digital supply chain transformation. The key factor for success is people, the intent and commitment of (supply chain) leadership and teams in taking charge of their own destiny.
The need for self-enablement in supply chain organizations
Traditionally, supply chain organizations have depended on transactional software that largely prescribed the way of operating through preconfigured screens and processes implemented by external consultants and internal IT departments. But this traditional way of operating is falling short and cannot keep up with the speed and complexity of change in today’s business reality. Digital transformation is impacting business and supply chains at their core, and as such, it is essential that supply chain organizations take charge of their digital strategy and execution.
This transition is not about implementing new versions of supply chain software with the help of external consultants and IT. It is about a thorough overhaul of the way organizations think about what their core activities are. This transition cannot be outsourced. Organizations must dare to do things differently and change their way of operating. Disruptors like Amazon have been doing this for years and very successfully.
Organizations can learn from these disruptors and self-enable themselves with the capability to make rapid changes to their supply chain models and apps. They need to be self-enabled to launch new supply chain apps quickly if their changing business reality demands it. They need to get answers in days, not weeks or months, in order to adapt quickly.
This need for self-enablement is ultimately what drove our team at AIMMS to launch AIMMS SC Navigator, a suite of configurable Apps for self-service Supply Chain Analytics. SC Navigator is designed for supply chain professionals without an analytics background and it has the lofty goal of democratizing analytics. It is AIMMS’ natural response to the paradigm shift captured in “software is eating the world.” By embracing the paradigm shift, we are are self-enabling ourselves to meet the changing demands of our market and the digital age supply chain. It is a logical extension to the AIMMS platform which seeks to bring the power of analytics closer to business users.
I believe this is only the first of many initiatives that will emerge in this movement towards self-enablement. Because when organizations are self-enabled, they are able to be more agile and carve out a significant competitive edge in this new digital paradigm.
Are you ready to start self-enabling your team?
There is no doubt that this digital transformation will have a far reaching impact in how supply chain organizations, and companies in general, are organized. Technology can help you facilitate the transition, but the human aspect is equally important. We, humans, are driving this transformation to meet the challenges imposed on us by this age. New fields and markets will keep emerging, pushing us to nurture skills that make us more flexible, creative, collaborative and adept at communicating and problem solving.
Is your company ready to embrace this new paradigm? It is more important than ever for businesses to be willing to disrupt themselves. This means testing new things quickly, training existing talent, attracting new talent, and, most importantly, fully committing to the transition.
Gijs Dullaert, CEO of AIMMS
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