Magazin
Authors

Thomas Mrozek
Partner at h&z

Jeremias Koch
Project Manager at h&z
Transformation into a digital supply chain
Digitalization is taking place in all business areas. The supply chain can also fulfill its tasks better, more efficiently and faster using digital applications and processes. h&z uses its experience from numerous projects to provide support during the transformation.
According to a recent study, more than one third of all German companies consider themselves to be lagging behind in digitalization. But is the situation in Germany really that dramatic? Read here how we worked with a customer to implement an AI-supported digital supply chain.
Shorter delivery times with intelligent logistics
Business was booming at a prospering mechanical engineering company, the order books were full; but the board also wanted to ensure success for the future and decided to reorganize their supply chain management to make it future-proof. While the focus in the past has been on optimizing supply chain elements such as continuous improvement and automation of order-oriented transaction processes, in the future the entire supply chain was supposed to be managed in an integrated and customer-oriented manner.
The project team defined the objective: The project should reduce the lead time to the customer from months to a few weeks, while at the same time increase the ability to deliver – without additional costs.
Supply Chain Management with customer interfaces
The goal was to find a digitally integrated SCM approach that would completely redefine supply chain control. In the future, the supply chain should be in a position to evaluate and decide rapidly changing operational topics based on scenarios and with the support of AI.
The requirements were high: The new SCM tool was to access all relevant data of the company, from personnel deployment plans to supplier data and production costs – supported by data about effects and costs, in order to map valid scenarios for decision making using artificial intelligence.
Additionally, a connection to the supply chains of the customers was desired. A user-friendly, cross-interface control of all data and parameters and the customer-specific optimized design on the basis of data analytics was expected.
Digitalization of the supply chain – test with live data
In view of the many internal and external interfaces and the heterogeneity of the existing application landscape, some project participants were initially skeptical.
The core of the digital transformation was to sketch the goal first in a manual process and to show different scenarios. The experience gained in the process helped the team to specify the requirements for the software solution more precisely.
The new supply chain management approach had to fulfil three main aspects:
- Speed – to make faster and more realistic decisions in the supply chain
- Scenario Simulation – supported by AI as a basis for decision making
- Buy-in – to the digital approach, because AI-supported decisions only find the necessary acceptance if those involved are convinced
Demo challenge with live data
The requirements for the digital SCM solution were specified on the basis of the preliminary work, and four providers were invited to demo challenges with live data. Using operational questions, we were able to identify which concrete solutions the individual providers offer for the corresponding requirements.
The digitally integrated supply chain emerges
The transparency and decision-making reliability gained in the supply chain have yielded the desired success. With the new SCM concept of digital solution and transformation, the company will make better quality decisions much faster and more efficiently in the future.
The project has confirmed that mere digitalization of the supply chain is not enough. Even if many areas are already digitized and automated, integrated business analytics solutions generate a clear value add. In combination with the right transformation approach, they allow for cross-functional networking of disparate units and make it possible to cope with the enormous data volumes of the digital „eco-system“.