We may have been selecting Supply Chain Digital transformation use case pilots the wrong way

Digital Transformation pilots- Crucial milestones in your Digital Transformation journey

It is not news for any executive who is planning to or already on the journey of Supply Chain Digital transformation- that the use case pilots that you will leverage as the basis of a full scale business case, are extremely critical. So much so, that in my perspective, a wrong choice of those use cases can even decide the magnitude of success of your Digital Transformation initiative.

The flawed approach to identifying Digital Tranfsormation pilots

Despite the pilots playing such a critical role in the success of Digital Transformation initiatives, our approach towards selecting pilots is still not mature. We either decide to select our pilots based on “areas where sh*t is hitting the fan” or the external partner may suggest use cases based on their experience. While it does not mean that these use cases will never be the right ones, there are many potential drawbacks to these approaches. The most critical flaw is that you may end up showing significant savings in one area, whereas in the “big picture”, the impact of the use case (say implementing an inventory reduction algorithm) in one area may lead to inefficiencies in other areas.

So what is the solution ?

Start with a comprehensive view

You must start with a comprehensive view. From a Supply Chain perspective, the good aspect is that there are numerous frameworks (like SCOR) that you can leverage to chart a comprehensive “Pilot plan”.

In this post, I will use the Logistics Bridge Model, proposed by Goldsby and Martichenko. The Logistics brige model, postulated for Lean Six Sigma Logistics. As you can see in the diagram below, I have broken down the elements of the Logistics Bridge model to the lowest granular level. And once you get to that level, THEN, you identify, define and plan the uses cases.

Capture

What are the advantages of leveraging this approach ?

There are many in my opinion but the two high level, most important ones are:

(1) It allows you to look at your Supply Chain or Logistics Digital transformation opportunities under the lens of a best practices framework

(2) After you have defined the use cases, as shown above, you can then leverage an approach (like system dynamics modeling) to determine how the final result expected, may impact a use case under another branch.


 

Views my own.

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