Bring Better Customer Experiences with Improved Extended Supply Chain
There’s a new challenge within original equipment manufacturers (OEMs): To bring better, closer, and stronger links with their customers and the best solution to overcome it is embarking digital transformation, especially extended supply chain. Many new disrupting technologies can improve supply-chain processes and bring better customer experiences such as the Internet of Things (IoT), Artificial Intelligence (AI), Cloud, Blockchain, Machine Learning, and more.
In this blog, I’m going to show how OEMs are changing, based on a report by The Economist Intelligence Unit (sponsored by Microsoft), and how new technologies can help them address today’s supply chain challenges.
1. Extended Supply Chain
There is a clear difference between traditional and extended supply chains: Transparency.
Consumers may be willing to pay 2% to 10% more for products from companies that provide greater supply chain transparency (MIT Sloan School of Management). Nowadays, customers are demanding the knowledge of both internal and external processes linked to the products they consume; therefore, companies must communicate this knowledge to build strong customer relationships.
Extended supply chain is structured to trace every process across the entire company, drawing information from all areas to effectively provide accurate information both for customers and stakeholders about each step of the process, from raw materials to manufacturing, transportation, employee treatment, suppliers, product quality and much more. This generates value to the company, not only by meeting the newest demand and overcoming today’s challenge but also, by getting real-time data from across the supply chain so decision-makers can easily analyze improvement opportunities and act upon it.
2. New Tecnology improving extended Supply Chain
In the Economist Intelligence Unit report, extended supply chain utilizes smart products to take one step further: Using smart products to transmit data back to the OEMs about their condition and usage to improve customer satisfaction even after purchasing.
It sure sounds great! But The Economist Intelligence Unit asked very important questions as the basis for their report: “How willing are OEMs to deploy them and how prepared are they to identify and act on the valuable insights new technologies will deliver? What are OEMs’ aspirations for intelligent supply chains? And how can supply-chain transformation improve customer experiences?”
The Economist Intelligence Unit found the following:
“99% of OEMs believe that the digital transformation of their supply chain is important for meeting their organizations’ strategic objectives.”
OEMs can achieve these objectives by relying on new technologies. The most effective are the ones that deliver data analysis operations: Cloud, robotics, IoT, AI, and blockchain. But there is a long way to go. When the Economist Intelligence Unit asked which of these technologies are being currently used, OEMs answered cloud 61%, robotics 18%, IoT 16%, blockchain, and AI just 5% and 4%.
3. Cloud-based ERP as a catalyst for change
Cloud technology has freed data across the supply chain to be easily used for collecting, storing, and processing within various integrated systems. Smart products stream data to these cloud-based systems to provide clues and insights regarding how customers interact with such products.
Blockchain helps supply chain transparency and efficiency by delivering multiple parties in an end-to-end supply chain. It brings a unified view of the process and goods while being constantly recorded to ensure the customer’s demand for knowledge is met.
Microsoft Dynamics 365 is a cloud-based system capable of unifying data across the entire supply chain. I have always thought that ERP solutions, such a Microsoft Dynamics 365 Supply Chain Management, are great steppingstones towards digital transformation not only for the features previously explained (cloud and blockchain) but also for the many capabilities they have available to help a business grow and evolve, providing different functionalities to improve operations. Click here to learn more about Microsoft Dynamics 365 Supply Chain Management
In short, expanded supply chain together with smart products are driving OEMs towards evolution and ensuring strong, close, and most importantly, trusting, customer relationships with both the products and the brand.
Thank you for reading this blog!