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Supply Chain Digitization – A Reality Check

By Richard Sharpe | 07/27/2016 | 10:17 AM | Categories: Web/Tech


Today, I am going to switch gears to focus on the hot industry topic “The Digitization of the Supply Chain”.  This subject is getting a lot of attention in the media especially as it relates to the Internet of Things (IoT).  According to Gartner, by 2020 there will be 21 trillion devices streaming information empowered by the IoT.  Information on everything from the current performance of a part within a machine to the current location of my dog. 

I get the industry buzz about the digitization of the supply chain.  But I have to ask myself the question; “Other than specific performance/event notifications, will companies really gain the true business value that is possible from this exponential growth in data?

Today, corporate enterprises have no shortage of data.  Data from their ERP, supply chain, finance and sales related systems, just to name a few.  Data that is often siloed and often hoarded by functional organizations.  Even with the ongoing investments that companies have made to access, visualize and manipulate their data, I often hear the statement “we still cannot get the insights we need from the information in our systems.  We aren’t realizing the return on investment we had hoped for and expected”.

In June of this year I ran the Analytics and Big Data Track for the Chief Supply Chain Officer Forum hosted by EyeForTransport.  It was a great day and a half spanning subjects from Data Governance, supporting enhanced S&OP processes and strategic initiatives all through the proper use of analytics and data.  The consensus from the discussions was clear.  To get real value from data you must have VACA:

  • Having processes in place to ensure the VALIDATION and quality of the data
  • Being able to have timely ACCESS to the data
  • Gaining CONCENSUS that the right data that is being used to solve a problem
  • Applying the appropriate ANALYTICS on the data to drive actionable insights that improve the performance of the business

Sounds pretty obvious, right?

However, if we are being honest, how many companies can say they have mastered VACA for the enterprise data they have today?  If not, then how is adding additional finite pieces of data that comes with the digitization of their supply chain going to help? 

I think a reality check is required.  Clearly, nothing is going to slow down the exponential growth of data and the digitization of supply chains.  There will be a continuation of great success stories such as the ability to catch the failure of a critical component of a machine before it actually fails.  However, to gain maximum value, companies need to prioritize and act on their VACA capabilities. 

The smart place to begin is with the data that already exists within the enterprise.  The smart money is to extract the value from this information before starting to add significant volumes of IoT data.

Without effectively addressing VACA requirements, the digitization of the supply chain will increase the data related headaches that most companies are wrestling with today.  With VACA proven and in place, the lessons and experience gained can then be applied to the new data that will come from future supply chain digitization investments. 

I would love to hear your thoughts.

P.S. - get this right and you can take a VACAtion! 

All the best,




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The opinions expressed herein are those solely of the participants, and do not necessarily represent the views of Agile Business Media, LLC., its properties or its employees.

About Richard Sharpe

Richard Sharpe

Richard Sharpe is CEO of Competitive Insights, LLC (CI), a founding officer of the American Logistics Aid Network (ALAN) and designated by DC Velocity as a Rainmaker in the industry. For the last 25 years, Richard has been passionate about driving business value through the adoption of process and technology innovations. His current focus is to support CI's mission to enable companies to gain maximum value through specific, precise and actionable insights across the organization for smarter growth. CI delivers Enterprise Profit Insights (EPI) solutions that enable cross-functional users to increase and protect profitability. Prior to his current role, Richard was President of CAPS Logistics, the forerunner of supply chain optimization. Richard is a frequent speaker at national conferences and leading academic institutions. His current focus is to challenge executives to improve their company's competitive position by turning enterprise wide data from a liability to an asset through the use of applied business analytics.


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