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 Digital
Supply Chain
JDA Software Special Edition

by Fred Baumann, Glen Ceniza,

Serge Massicotte,
Anand Medepalli, and
Kelly Thomas

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 Digital Supply Chain For Dummies®, JDA Software Special Edition

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 Contents at a Glance
Introduction ....................................................................................................... 1
CHAPTER 1: Supply Chain Digitalization ..................................................................... 3
CHAPTER 2: Your Digital Supply Chain Playbook..................................................... 17
CHAPTER 3: Creating Your Digital Strategies and Technologies ........................... 27
CHAPTER 4: Linking the IT Department into Your Digital Supply Chain............... 45
CHAPTER 5: Eight Critical Success Factors ................................................................ 53

Appendix: Glossary..................................................................................... 59

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 Publisher’s Acknowledgments

Some of the people who helped bring this book to market include the following:

Development Editor: Ryan Williams Production Editor: Siddique Shaik

Project Editor: Jennifer Bingham Special Help from JDA:
Fabrizio Brasca, Kevin Iaquinto,
Acquisitions Editor: Steve Hayes
Doug Kimball, John Sarvari,
Editorial Manager: Rev Mengle Laura Sanders, Anna Sherman-Hall,
Business Development Representative: q­óđđ™Ï­ÞºĄđ
Kimberley Schumacker

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 Table of Contents
INTRODUCTION ............................................................................................... 1
About This Book ................................................................................... 1
Foolish Assumptions ............................................................................ 1
Icons Used in This Book....................................................................... 2
Beyond the Book .................................................................................. 2

&+$37(5b Supply Chain Digitalization ................................................. 3

What Is Digital? ..................................................................................... 3
Forging Your Digital Supply Chains .................................................... 5
The Value of a Digital Supply Chain ................................................... 7
What Is Everybody Else Thinking? .................................................... 10
Advanced analytics ....................................................................... 11
Augmented reality ........................................................................ 11
Big data .......................................................................................... 11
Cloud-based applications ............................................................ 11
Digitalizing manual processes ..................................................... 11
Internet of Things (IoT) ................................................................. 11
Mobile applications....................................................................... 12
5DGLR)UHTXHQF\ΖGHQWLȴFDWLRQ5)Ζ' ........................................ 12
Supply chain systems integration with trading partners ......... 12
Internal supply chain integration ................................................ 12
Supply chain visibility ................................................................... 12
What Is the Future of the Digital Supply Chain? ............................. 15

&+$37(5b Your Digital Supply Chain Playbook ........................... 17

'HȴQLQJ<RXU3OD\ERRNIRU'LJLWDO6XSSO\&KDLQ6XFFHVV............. 18
7KHR΍HU......................................................................................... 19
The supply chain ........................................................................... 22
The asset ........................................................................................ 24

&+$37(5b Creating Your Digital Strategies

DQGb7HFKQRORJLHV ....................................................................... 27
Segmenting Your Supply Chain ........................................................ 27
Invest in your data ........................................................................ 28
Segment your customers ............................................................. 28
Align supply chain strategy .......................................................... 29

Table of Contents v

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 Create a visible supply chain ....................................................... 29
5HDSWKHEHQHȴWV ......................................................................... 29
'LJLWDOO\(QDEOH$OZD\V2Q0DQXIDFWXULQJ3ODQQLQJ ..................... 30
Leverage IoT Technology to Reduce Costs ...................................... 31
Digitally Enable Real-Time Collaboration ........................................ 32
Use Digital Data to Accelerate Transportation
Insights into Action............................................................................. 32
Digitally Enabling Warehouse Automation and Optimization ...... 35
Workforce technology .................................................................. 35
Automation and robots ................................................................ 36
Satisfying customer demand ....................................................... 36
Smart optimization ....................................................................... 37
Deliver a Seamless Store Experience ............................................... 38
The seamless store experience ................................................... 38
6WDɝQJWKHVWRUH........................................................................... 39
Bringing Your Digital Strategies Together ....................................... 40
Enterprise-wide visibility .............................................................. 41
Supply chain modeling ................................................................. 42
Response management ............................................................... 42

&+$37(5b Linking the IT Department into

Your Digital Supply Chain ................................................... 45
More Information, More Data .......................................................... 45
.HHSLQJ3DFHZLWK7HFKQRORJ\ ......................................................... 46
Automated Decisions, Decisions, Decisions.................................... 46
7HDU'RZQWKH6LORV .......................................................................... 47
Combine your solutions for greater value ................................. 47
Create a platform for consuming innovation ............................ 48
Take it to the cloud ....................................................................... 48
Creating a Digital Mind for Moving in the New World ................... 49
Connecting the informational dots matters .............................. 50
Finding the same insights in an ocean of data .......................... 50
&RPSXWHUVȴQGQHZSDWWHUQV ..................................................... 50
Turning insights into action ......................................................... 51

&+$37(5b  (LJKW&ULWLFDO6XFFHVV)DFWRUV........................................... 53
'HȴQH<RXU'LJLWDO6WUDWHJ\ .............................................................. 54
It All Starts at the Top......................................................................... 54
Digital Supply Chains Require New Competencies ........................ 55

vi Digital Supply Chain For Dummies, JDA Software6SHFLDO(GLWLRQ

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 Visibility Alone Is Not the End Goal .................................................. 56
Invest in Digital Talent ....................................................................... 56
Keep an Eye on the Competition ...................................................... 57
Accept This New Reality ..................................................................... 57
Start Small and Fail Fast .................................................................... 58

APPENDIX: GLOSSARY .............................................................................. 59

Table of Contents vii

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 About the Authors
Fred Baumann, Group Vice President, Global Industry Strategy, is
responsible for JDA’s manufacturing verticals. During his 18-year
tenure at JDA, Fred launched JDA’s Flowcasting business initiative
and has been instrumental in driving JDA’s collaborative trad-
ing community strategies, thought leadership, and launching
đ̺­óèĀžêĩɭĈi,mɊqʩ\ižê³žêžáĩđÏ­ĈóĵºĄÏêÆĈɐiĄÏóĄđóEɊ
he worked at IBM and The Pillsbury Company. Fred is a former
advisory board member of the CPFR VICS and GS1 industry sub-
committee and is a named contributor to several published indus-
try guidelines. He is a frequent speaker at industry conferences
and has been recognized as a Rock Stars of the Supply Chain by
Food Logistics. Fred holds a bachelor’s degree from Georgia State
University and an MBA with distinction from the University of
ĄÞžêĈžĈɊqžèQɐɯžáđóêq­ÌóóáóÄėĈÏêºĈĈɊģ̺Ąº̺̞³ž­óĄº
focus in supply chain management.

Glen Ceniza, Group Vice President, Product Management, is respon-

sible for JDA’s Store Operations solution, with oversight responsi-
bility for R&D investments in JDA execution product lines. During
his 16-year tenure at JDA, he has overseen JDA’s retail strategy,
managed technical teams for hosting SaaS and cloud strategy, and
spearheaded Global Solution Sales. Glen joined JDA when RedPrairie
purchased BlueCube, a product that he helped design, in 2001. Prior
to RedPrairie, Glen worked at NetLumious, Xerox Global Services,
and Lotus Development Corporation. He holds a bachelor’s degree
in mechanical engineering from Georgia Institute of Technology.

Anand Medepalli, Vice President, Retail Planning Product Strat-

ºÆĩɊÏĈĄºĈĀóêĈÏ«áºÄóĄ³ºĸêÏêƞ곺Ĩº­ėđÏêÆĈđĄžđºÆϺĈÄóĄEɭĈ
Retail Planning and Pricing solutions. He has over 20 years of
experience designing and deploying decision-support enterprise
ĈóáėđÏóêĈɐmº­ºêđáĩɊêžê³ẳđ̺ážėê­ÌóÄEɭĈĸĄĈđɢºĢºĄđĄėº
SaaS solution Retail.me, a next-generation, customer-centric
retail planning application that leverages the latest advances in big
data science and user experience research, and has been instru-
mental in driving JDA’s thought leadership in this space. Prior to
JDA, Anand worked at Earnix, Talus Solutions and Sabre. Anand
is a trusted advisor for executives at leading companies in pricing

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 and product, commercial account and asset planning strategies.
He holds a doctorate in mathematics from Iowa State University.

Serge Massicotte, Executive Vice President and Chief Technol-

óÆĩ\Ķ­ºĄɊÏĈĄºĈĀóêĈÏ«áºÄóĄºĈđž«áÏĈÌÏêÆɊ­óèèėêÏ­žđÏêÆɊžê³
delivering JDA’s core technology, including product architecture,
innovation, analytics, cloud enablement, and mobility. Prior to
JDA, Serge served as the Senior Vice President of Product Engi-
neering at Cloud9, a Silicon Valley startup providing cloud appli-
cations for sales forecasting and pipeline management. There
he was responsible for developing a best-in-class platform for
Cloud9’s SaaS applications. Prior to Cloud9, Serge worked for
Taleo Corporation as Vice President and General Manager of
Enterprise Products and Platform and was responsible for devel-
oping the architectural underpinnings of the company’s SaaS
talent management solutions. Prior to Taleo, he served as Vice
President of Product and Operations in charge of GEOCOMtms, a
company acquired by RedPrairie in 2007. Serge holds a bachelor’s
degree in mathematics, a bachelor’s degree and a master’s degree
in computer science from Université Laval, and a master’s degree
in computer science from York University in York, UK.

Kelly ThomasɊqºêÏóĄŒÏ­ºiĄºĈϳºêđžê³ÌϺÄiĄó³ė­đ\Ķ­ºĄɊÏĈ
responsible for leading JDA’s product strategy and management
and aligning JDA’s R&D investment to its go-to-market strate-
gies. He has 30 years of experience in leading teams in design,
development, sales, and delivery of supply chain management
and manufacturing execution solutions. Kelly is the author of
more than 20 papers in the areas of supply chain management
and related technology and is a frequent speaker at industry con-
ferences. He is a former board member of the Supply Chain Coun-
cil, and has been recognized as a Supply Chain Pro to Know by
Demand and Supply Chain Executive. Kelly holds a bachelor’s degree
in chemical engineering from Rutgers University, where he was a
Slade Scholar.

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 Authors’ Acknowledgments
This book was made possible thanks to input by JDA contributors:

» Fabrizio Brasca, Vice President of Solution Strategy, is

UHVSRQVLEOHIRUGHȴQLQJDQGH[HFXWLQJJOREDOJRWRPDUNHW
VWUDWHJLHVIRU-'$ȇVΖQWHOOLJHQW)XOȴOOPHQWVROXWLRQ
» Doug Kimball,6HQLRU3URGXFW0DUNHWLQJ'LUHFWRULV
UHVSRQVLEOHIRUGHYHORSLQJVDOHVHQDEOHPHQWPHVVDJLQJ
DQGbFRQWHQWIRU-'$ȇV0DQXIDFWXULQJ3ODQQLQJDQG
)ORZFDVWLQJVROXWLRQV

The authors would also like to acknowledge JDA colleagues Kevin

Iaquinto, John Sarvari, Laura Sanders, Anna Sherman-Hall, and
Scott Zickert for their assistance in the preparation of this work.

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 Introduction
A
nd you thought the invention of the internet was a big
deal? The new digital technologies and capabilities devel-
oped these days will have as great or even greater impact
óêĈó­Ïºđĩđ̞êģ̺êÄóáÞĈĸĄĈđĈđžĄđº³Ĉºê³ÏêƺèžÏáèºĈĈžÆºĈ
over ancient networks. This wave of technological innovation will
impact all aspects of business, including your supply chain.

About This Book

In this book, you get a closer look at what the new digital supply
chain means to your business and how supply chain practitioners
are responding to these rapid technology advancements. We show
you how these changes require a new playbook for digital supply
chain success, as well as the digital strategies and technologies
you’ll want to consider as you embark on your digital supply chain
journey.

Because this is a JDA Software Special Edition, we also dive into

IT considerations for enabling the new digital supply chain. So sit
«ž­ÞɊÆĄž«ž­ėĀóÄ­óĵººɊžê³³ÏÆÏêɐ"êÛóĩđ̺ģÏá³ĄÏ³ºđó³ÏÆÏđžá
supply chain transformation!

Foolish Assumptions
In preparing this book, we’ve assumed a few things about you:

» You’re a supply chain executive interested in learning about

how the latest digital technologies can improve your
company’s supply chain.
» You work in supply chain management and want an update
on the latest digital strategies, tools, and techniques.
» You’re a newcomer to the role of supply chains and want to
educate yourself quickly on the basic concepts around the
practice and how digital technologies are changing the game.

Introduction 1

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 Icons Used in This Book
“óėɭááĸ곞­óėĀáºóÄÏ­óêĈÏêđ̺èžĄÆÏêĈóÄđÌÏĈ«óóÞɐ6ºĄºɭĈ
what they mean.

This icon indicates a helpful tip on how to get things done or

žɯ ̞ê³ĩ ĀϺ­º óÄ ºĨ𥞠ÏêÄóĄèžđÏóêɐ óėá³êɭđ ÌėĄđ đó Ąºž³ ÏđɊ
­óėá³ɯÏđɑ

Anything with this icon is something that you want to keep in

mind. Always good to refresh your memory!

žêđÏêÆÛėĈđđ̺«žĈÏ­ĈÏĈĸêºɐėđÏÄĩóėáÏÞºđó³ÏÆÏêđóđ̺èóĄº
technical details, this information is right up your alley.

Beyond the Book

“óė­žêĸ곞³³ÏđÏóêžáÏêÄóĄèžđÏóêž«óėđĈėĀĀáĩ­ÌžÏêèžêžÆº-
ment by visiting the following websites:

» For more information about how JDA Software can help you
on your digital supply chain journey, visit www.jda.com.
» For an online magazine dedicated to the latest supply chain
management news, visit www.scw-mag.com.
» For a weekly online newsletter that focuses on supply chain
management and logistics, visit www.scdigest.com.
» For an analysis of logistics trends, technologies, and services,
visit www.logisticsviewpoints.com.
» For access to thought leadership in supply chain manage-
ment, visit www.chainlinkresearch.com.

2 Digital Supply Chain For Dummies, JDA Software Special Edition

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 IN THIS CHAPTER
» Discovering how digital technology
D΍HFWVHYHU\VWHSRI\RXUVXSSO\FKDLQ

» /HDUQLQJWKHYDOXHRIGLJLWDOL]LQJ\RXU
supply chain

» Examining how other companies

implement a digital supply chain

&KDSWHUb 1
Supply Chain
Digitalization

T
º­ÌêóáóÆĩ ÏĈ êóđÌÏêÆ êºģ Ïê đó³žĩɭĈ ģóĄá³ɯ ɠ ºĢºĄĩóêº
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đº­ÌêóáóÆĩ ­žê ž³Ģžê­º žáèóĈđ žêĩ žĈĀº­đ óÄ žêĩ «ėĈÏêºĈĈɯ ɠ
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the term digital supply chain 躞êĈ žê³ Ìóģ ĩóėĄ «ėĈÏêºĈĈ ģÏáá
«ºêºĸđÆĄºžđáĩɐ

What Is Digital?
zÌĄóėÆÌóėđđÌÏĈ«óóÞɊģºɭĄºÆóÏêÆđó«ºđžáÞÏêÆž«óėđžááđÌÏêÆĈ
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» Physical “things” incorporating computer technology

(sometimes referred to as the Internet of Things)
» Readily available external big data, including social, news,
events, and weather
» Computer systems and software becoming increasingly
real-time and intelligent

CHAPTER 1 Supply Chain Digitalization 3

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 A digital supply chain ­žĀÏđžáÏįºĈ óê đ̺Ĉº đÌĄºº đĄºê³Ĉ đó ĀĄóĸđɢ
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ĀĄó­ºĈĈžđđÌÏĈĀóÏêđɐ

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increasingly dependent on digital technologies to create competiɢ
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computer chip technology mainly occurred in computers and in
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allows them to communicate insights to computers and to each
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like smart or intelligentɐ ,óĄ ºĨžèĀáºɊ ģ̺ê ­ºáá ĀÌóêºĈ ĈđžĄđº³
Ïê­áė³ÏêÆ ­óèĀėđºĄ ­ÌÏĀĈɊ ĈóÄđģžĄºɊ žê³ óĀºĄžđÏêÆ ĈĩĈđºèĈ ÄóĄ
èó«ÏẠ꺺³ĈɊ đ̺ĩ «º­žèº Þêóģê žĈ smartphones. 9êÄóĄèžđÏóê
ĈºêđÄĄóèóêºĈèžĄđđÌÏêÆđóžêóđ̺ĄÏĈ­žáẳždigital signalɐ

IÏÞºģÏĈºɊ ºĨđºĄêžá «ÏÆ ³žđž ÄĄóè èžêĩ ĈóėĄ­ºĈ ÏĈ êóģ žĢžÏឫáº
đó ­óĄĀóĄžđÏóêĈɐ qó­Ïžá ÏêÄóĄèžđÏóê ĈóėĄ­ºĈ Ĉė­Ì žĈ zģÏđđºĄ žê³
,ž­º«óóÞ̞ĢºóĀºêapplication programming interfacesɞi9ɟÄĄóè
ģÌϭ̳žđž­žê«º³ºĄÏĢº³ɐ

€Ĉºđ̺Ĉº³žđžÄóĄĩóėĄ­óèĀºđÏđÏĢºÏêĈÏÆÌđĈɌ,óĄºĨžèĀáºɊžĈÏêɢ
ÆẠđģººđ óĄ ž ĈĀÏÞº Ïê .óóÆẠĈºžĄ­ÌºĈ ɞɩ9 I\Œ" “\€m mS
\, 6""q"ɌɌɌɪɟ ­žê «º ºžĄáĩ Ïê³Ï­žđóĄĈ óÄ ³ºèžê³ ­ÌžêƺĈ ÄóĄ
ž ĀĄó³ė­đɐ º Ąºž³ĩ đó žêžáĩįº žê³ áºĢºĄžÆº đÌÏĈ ÏêÄóĄèžđÏóê đó
ÏèĀĄóĢºĈėĀĀáĩ­ÌžÏêóĀºĄžđÏóêĈɐ

4 Digital Supply Chain For Dummies, -'$6RIWZDUH Special Edition

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 đ đ̺ Ĉžèº đÏèºɊ ­óèĀėđºĄ ĈĩĈđºèĈ Ąėê «ĩ ­óèĀžêϺĈ žĄº
«º­óèÏêÆÏê­ĄºžĈÏêÆáĩÏêđºááÏƺêđžê³ž«áºđóèžÞº«ÏƳº­ÏĈÏóêĈ
ÏêĄºžáɢđÏèºɐ6ºĄºɭĈž­áóĈºĄáóóÞžđģ̞đđ̞đ躞êĈɉ

» Intelligent computer systems and software can learn and

adapt versus relying on preprogrammed rules to only handle
a prescribed set of inputs. These intelligent systems can also
predict events, provide insights, and prescribe actions.
» Real-time means computer systems can continuously
process digital signals and stay synchronized with what’s
happening in the physical world.

ºĢÏ­ºĈģÏđ̺諺³³º³­óèĀėđºĄđº­ÌêóáóÆĩ­óėĀẳģÏđ̺ĨđºĄɢ
êžá «ÏÆ ³žđž ­žê êóģ ­óè«Ïêº ģÏđÌ ĈèžĄđ ºêđºĄĀĄÏĈº ­óèĀėđºĄ
ĈĩĈđºèĈđóóĵºĄžÌóĈđóÄêºģžĀĀĄóž­ÌºĈÄóĄèžêžÆÏêÆĈėĀĀáĩ
­ÌžÏêĈžê³Ï곺áÏĢºĄÏêÆĀĄó³ė­đĈžê³ĈºĄĢÏ­ºĈđó­ėĈđóèºĄĈɐzÌÏĈ
ÏĈđ̺ºĈĈºê­ºóÄž³ÏÆÏđžáĈėĀĀáĩ­ÌžÏêɐ

Forging Your Digital Supply Chains

³ÏÆÏđžáĈėĀĀáĩ­ÌžÏêÏê­ĄºžĈÏêÆáĩáºĢºĄžÆºĈÏêđºááÏƺꭺºè«º³ɢ
³º³ Ïê ³ºĢÏ­ºĈɊ ºĨđºĄêžá «ÏÆ ³žđž ĈóėĄ­ºĈɊ žê³ ÏêđºááÏƺêđ ĈėĀĀáĩ
­ÌžÏêĈóÄđģžĄºđóž­­óèĀáÏĈÌĈºĢºĄžáÆóžáĈɉ

» Improve customer experiences

» 'HOLYHUKLJKHUSURȴW
» Increase the value of products in the market
» Create new business models and revenue streams
» Rule the world (okay, maybe not this one)

€áđÏèžđºáĩɊž³ÏÆÏđžáĈėĀĀáĩ­ÌžÏê³ĄžģĈóêºè«º³³º³ÏêđºááÏƺꭺ
ÏêžááĀÌĩĈÏ­žáºăėÏĀèºêđžĈĈó­Ïžđº³ģÏđÌĀÌĩĈÏ­žážĈĈºđĈɉ

» Stores
» Transportation
» Warehouses
» Factories
» Inventories
» People (and maybe cyborgs)

CHAPTER 1 Supply Chain Digitalization ȭ

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 ááđ̺ĈºžĈĈºđĈģÏáá­óê꺭đºáº­đĄóêÏ­žááĩđóžááóđ̺ĄºăėÏĀèºêđɊ
ÏêĢºêđóĄĩɊžê³ĀºóĀáºÏêĄºžáɢđÏèºɐ

IÏÞº žê óĄ­ÌºĈ𥞠꺺³Ĉ ž ­óê³ė­đóĄɊ đ̺ ÏêđºĄ­óê꺭đº³êºĈĈ óÄ

žĈĈºđĈ žê³ ºĨđºĄêžá «ÏÆ ³žđž ĈóėĄ­ºĈ ĄºáϺĈ óê êºģ ĈėĀĀáĩ ­ÌžÏê
èžêžÆºèºêđĈóÄđģžĄºɐzÌÏĈĈóÄđģžĄºĀĄóĢϳºĈĀĄº³Ï­đÏĢºžê³ĀĄºɢ
Ĉ­ĄÏĀđÏĢºžêžáĩđÏ­Ĉžê³ẞĄêÏêÆ­žĀž«ÏáÏđϺĈɐz̞đɭĈĄÏÆÌđɯɠđ̺ĩ
ẞĄê«ĩģžđ­ÌÏêÆĩóėɌzÌÏĈđº­ÌêóáóÆĩđĄžêĈÄóĄèĈđ̺đĄž³ÏđÏóêžá
áºÄđɢđóɢĄÏÆÌđɊáÏ꺞ĄɊžĈĈºđɢ³ĄÏĢºêĢϺģóÄđ̺ĈėĀĀáĩ­ÌžÏêÏêđóž
³ĩêžèÏ­ÆĄÏ³ɊžĈĈÌóģêÏê,ÏÆėĄºɯȩɢȩɐ

Source: JDA
)Ζ*85(b Linear supply chain versus digital supply chain.

9êđ̺³ĩêžèÏ­ÆĄÏ³ɊĄºážđÏóêĈÌÏĀĈžèóêÆêó³ºĈÏêžĈėĀĀáĩ­ÌžÏê
«º­óèº digitalizedɐ zÌÏĈ 躞êĈ đ̞đ ĈėĀĀáĩ ­ÌžÏê èžêžÆºèºêđ
ĈóÄđģžĄº­ĄºžđºĈèėáđÏĀáºĢÏĄđėžáĈėĀĀáĩ­ÌžÏêĈž­ĄóĈĈžĈÏêÆáºĈºđ
óÄĀÌĩĈÏ­žážĈĈºđĈɐ€áđÏèžđºáĩɊĩóėɭááĈººèžêĩɢđóɢèžêĩĄºážđÏóêɢ
ĈÌÏĀĈžèóêÆĈėĀĀáĩ­ÌžÏêêó³ºĈɐz̞đ躞êĈžÆÏĢºêóĄ³ºĄÄĄóè
ž ÆÏĢºê ­ėĈđóèºĄ ­žê Äóááóģ ÏđĈ óģê ėêÏăėºɊ ­ėĈđóèÏįº³ ĀžđÌ
đÌĄóėÆÌ đ̺ ĈėĀĀáĩ ­ÌžÏêɊ ­ĄºžđÏêÆ ĀºĄĈóêžáÏįº³ Äėáĸááèºêđ ÄóĄ
đ̺­ėĈđóèºĄɐ9đɭĈáÏÞº«ºÏêÆž«áºđó­žđ­ÌžĹÏÆÌđđóĩóėĄėáđÏèžđº
³ºĈđÏêžđÏóêɊêóèžđđºĄÌóģĈèžááđ̺žÏĄĀóĄđɐzÌÏĈĈĩĈđºèĀឭºĈ
đ̺ ­ėĈđóèºĄ žđ đ̺ ­ºêđºĄ óÄ đ̺ ĈėĀĀáĩ ­ÌžÏêɯ ɠ žê³ ģº ̺žĄ
đ̞đɭĈģ̺Ąºđ̺ĩáÏÞºđó«ºɐ

9êđ̺³ÏÆÏđžáĈėĀĀáĩ­ÌžÏêĢϺģɊžááĀÌĩĈÏ­žážĈĈºđĈĈėĄĄóėê³đ̺
­ėĈđóèºĄžê³đ̺ê³ĩêžèÏ­žááĩÄóĄèÏêđºĄĄºážđÏóêĈÌÏĀĈđóĀĄó­ºĈĈ
žê³ Äėáĸáá óĄ³ºĄĈ Ïê đ̺ ģžĩ đ̺ ­ėĈđóèºĄ ģžêđĈ đ̺è Äėáĸáẳɐ
9ê­Ï³ºêđžááĩɊ đÌÏĈ ĀĄó­ºĈĈ žáĈó óĀđÏèÏįºĈ ĀĄóĸđ ÄóĄ đ̺ ºêđºĄɢ
ĀĄÏĈº ɞđ̞đɭĈ ĩóėɟɐ “óėĄ ĀÌĩĈÏ­žá žĈĈºđĈ Ïê đ̺ ĈėĀĀáĩ ­ÌžÏê žê³
đ̺èžêžÆºèºêđóÄđ̺ĈėĀĀáĩ­ÌžÏ꫺­óèºĹºĨϫẞ곞³žĀđɢ
ž«áººêóėÆÌđ̞đžđžÏáóĄº³žê³ĀºĄĈóêžáÏįº³­ėĈđóèºĄºĨĀºĄÏºê­º
­žê «º ĀĄóĢϳº³ɐ z̺ ­ėĈđóèºĄĈ «ºÆÏê đó «ºáϺĢº đ̺ ºêđºĄĀĄÏĈº
ĀĄóĢϳºĈ đ̺è ģÏđÌ đÌºÏĄ óģê ĀºĄĈóêžá ĈėĀĀáĩ ­ÌžÏêɐ º ­žáá Ïđ
a supply chain of oneɊžê³ÏđɭĈÄóė곞đÏóêžáđóž­ėĈđóèºĄɢ­ºêđĄÏ­
ĈėĀĀáĩ­ÌžÏêɐ

6 Digital Supply Chain For Dummies, -'$6RIWZDUH Special Edition

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 9ê đ̺ ³ÏÆÏđžá ĈėĀĀáĩ ­ÌžÏêɊ ĈėĀĀáĩ ­ÌžÏê èžêžÆºèºêđ ĈóÄđģžĄº
­óêĈėèºĈ ³ÏÆÏđžá ĈÏÆêžáĈ Ïê ĄºžáɢđÏèºɊ žááóģÏêÆ đ̺ ĈóÄđģžĄº đó
­óêĢºĩžêž­­ėĄžđºɊĀĄº­ÏĈºė곺ĄĈđžê³ÏêÆóĺĢºĄĩđÌÏêÆ̞ĀĀºêɢ
ÏêÆÏêđ̺ĈėĀĀáĩ­ÌžÏêɐz̺ĀÌĩĈÏ­žáģóĄá³óÄĈėĀĀáĩ­ÌžÏêžĈĈºđĈ
žê³đ̺³ÏÆÏđžáģóĄá³óÄĈėĀĀáĩ­ÌžÏêĈóÄđģžĄº­óêĢºĄÆºÏêđóóêº
ĀĄóĸđž«áºɊ­ėĈđóèºĄɢÄó­ėĈº³ĈĩĈđºèɐ"ĢºĄĩ«ó³ĩ̞ĀĀĩɑ

9ê đ̺ ĀžĈđɊ Ĉóèº đÏèº ºážĀĈº³ «ºđģººê ģ̞đ ̞ĀĀºêº³ Ïê đ̺
ĀÌĩĈÏ­žá ģóĄá³ žê³ ģ̞đ đ̺ ³ÏÆÏđžá ģóĄá³ óÄ ĈėĀĀáĩ ­ÌžÏê ĈóÄđɢ
ģžĄº ĄºÆÏĈđºĄº³ɐ ėđ đ̺ ­ėĄĄºêđɊ ĄºžáɢđÏèº ĢϺģ óÄ đ̺ ĈėĀĀáĩ
­ÌžÏêɊ žėÆèºêđº³ ģÏđÌ ºĨđºĄêžá ³žđž áÏÞº Ĉó­Ïžá 躳ϞɊ êºģĈɊ
ºĢºêđĈɊžê³ģºžđ̺ĄɊ­žê̺áĀĩóėđó«ºđđºĄė곺ĄĈđžê³­óêĈėèºĄ
ÏêđºêđɊė곺ĄĈđžê³ĄÏĈÞɊžê³ĀĄº³Ï­đ³ºèžê³žê³ĈėĀĀáĩɐ

"諺³³º³ ­óèĀėđºĄ đº­ÌêóáóÆĩɊ ºĨđºĄêžá «ÏÆ ³žđž žĢžÏឫÏáÏđĩɊ

žê³ÏêđºááÏƺêđĈėĀĀáĩ­ÌžÏêĈóÄđģžĄºžĄºĸê³ÏêÆđÌºÏĄģžĩÏêđóžáá
«ėĈÏêºĈĈĀĄó­ºĈĈºĈžĈĈó­Ïžđº³ģÏđÌĄºđžÏáºĄĈɊ³ÏĈđĄÏ«ėđóĄĈɊđÌÏĄ³ɢ
ĀžĄđĩáóÆÏĈđÏ­ĈĀĄóĢϳºĄĈɊžê³èžêėĞ­đėĄºĄĈɐz̞đ躞êĈºĢºĄĩɢ
«ó³ĩºáĈº̞ĈđóÛėèĀóê«óžĄ³žĈģºááɐz̺Ĉº«ėĈÏêºĈĈĀĄó­ºĈĈºĈ
ģÏáážáá꺺³đóÏê­óĄĀóĄžđºđ̺Ĉºêºģ­žĀž«ÏáÏđϺĈɉ

» 0HUFKDQGLVHȴQDQFLDOPDQDJHPHQW
» Assortment planning
» Category management
» Store operations
» Warehouse management
» Transportation management
» Demand management
» Replenishment
» Manufacturing planning and scheduling

7KH9DOXHRID'LJLWDO6XSSO\&KDLQ
z̺³ÏÆÏđžáĈėĀĀáĩ­ÌžÏêÏĈđ̺êºĨđĈđºĀÏêđ̺ºĢóáėđÏóêóÄèó³ºĄê
ĈėĀĀáĩ­ÌžÏêèžêžÆºèºêđɐóèĀėđºĄĈžê³ĈóÄđģžĄºžĈĈÏĈđÏêđ̺
èžêžÆºèºêđóÄžĈĈºđĈɊóĄºĢºêĄºĀឭºžĈĈºđĈºêđÏĄºáĩɐ,óĄºĨžèɢ
ĀáºɊóêºóÄđ̺ĄºžĈóêĈ­óèĀžêϺĈºèĀáóĩĈėĀĀáĩ­ÌžÏêèžêžÆºɢ
èºêđ ĈóÄđģžĄº ÏĈ đó Ąº³ė­º ÏêĢºêđóĄĩɐ “óė ³óêɭđ ģžêđ Ìėê³Ąº³Ĉ

CHAPTER 1 Supply Chain Digitalization 7

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 óÄĈÞϳĈÄėááóijóááĈđžÞÏêÆėĀĢžáėž«áºģžĄºÌóėĈºĈĀž­ºɊ³óĩóėɑ
9ê đÌÏĈ ­žĈºɊ ĈėĀĀáĩ ­ÌžÏê èžêžÆºèºêđ ĈóÄđģžĄº óĀđÏèÏįºĈ đ̺
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̞ĢºđóĈđóĄºđ̺èÏêĢžĄÏóėĈĀឭºĈÌóĀÏêÆÄóĄžêóĄ³ºĄɐ

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žĈĈºđĈɐ

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7$%/(b How Digital Supply Chain Technology Replaces

Traditional Supply Chain Processes
Digital Area Description / Example

Enabling interactions Discovery, research, buying, rating, and returns

with consumers through e-commerce and mobile.

Driving business-to-business These interactions become increasingly digital

(B2B) interactions through machine-to-machine interactions.

Driving personalized 7KHGLJLWDOVXSSO\FKDLQȴQGVDSDWKWRGHOLYHUZKDW

IXOȴOOPHQW the consumer wants, when and where the
consumer wants it.

Enabling real-time systems The digital supply chain processes digital signals
and physical-digital and big data to create an accurate picture of the
convergence supply chain and consumers.

Enabling learning systems 6XSSO\FKDLQVRIWZDUHHPSOR\VDUWLȴFLDOLQWHOOLJHQFH

to learn and adapt, rather than just handle a
prescribed set of inputs with a prescribed set
of actions.

$VVLVWLQJSK\VLFDODVVHWVbȂ Computer technology is embedded in production

machinery, property, capacity and transportation equipment, providing
plant, equipment status and location information.

(continued)

CHAPTER 1 Supply Chain Digitalization 9

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Digital Area Description / Example

5HSODFLQJSK\VLFDODVVHWVbȂ 3D printing digitalizes manufacturing and

machinery, property, transportation by essentially eliminating the need
plant, equipment for transport via manufacturing on demand.

Assisting labor capital The digital supply chain enables augmented reality
through wearables. Schedule and manage work
through mobile apps.

Replacing labor capital Robots automate production processes, and labor

management software increases productivity.

Assisting inventory Embedded chips provide real-time location

information.

Replacing inventory Supply chain software reduces inventory.

Enhancing products Almost all value-add content of cars in the past 10

years is digital, including entertainment, safety, and
driver-assist capabilities.

Creating new products Mobile apps create the sharing economy. Services
and services R΍HUPRQLWRULQJDQGPDQDJHPHQWRIFRQVXPHU
products with embedded chips.

Assisting in the use Examples include cars equipped with driver-assist

of products capabilities or supply chain software that prescribes
decisions for demand and supply actions.

Replacing humans in the Self-driving cars and trucks remain an intriguing (if
use of products slightly terrifying) prospect.

Creating its own digital Humanlike systems that think, act, and understand
scenarios.

What Is Everybody Else Thinking?

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ȩȬ Digital Supply Chain For Dummies, -'$6RIWZDUH Special Edition

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Digital Supply Chain?
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ºĢóáĢÏêÆĢºĄĩĄžĀϳáĩɐ

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out some new techniques while you maintain your current proɢ
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CHAPTER 1 Supply Chain Digitalization ȩȭ

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 ȩȮ Digital Supply Chain For Dummies, -'$6RIWZDUH Special Edition

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 IN THIS CHAPTER
» Evaluating the old playbook

» Creating your new digital playbook

» Understanding the changes to your

digital supply chain

&KDSWHUb 2
Your Digital Supply
Chain Playbook

T
hink about how the internet has transformed business
operations in the past 25 years. Business is now at the cusp
óÄžĈÏèÏឡÏêêóĢžđÏóê«ĄºžÞĀóÏêđđ̞đģÏááĄº³ºĸêºÏê³ėĈ-
đĄÏºĈ ÄóĄºĢºĄɯ ɠ žê³ ģÏáá ĀĄºĈºêđ Ìėƺ óĀĀóĄđėêÏđϺĈ ÄóĄ đÌóĈº
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đóèžĄÞºđÏêžÄė곞èºêđžááĩ³ÏĵºĄºêđģžĩɐzó­ĄóĈĈđ̺³ÏÆÏđžá
³ÏĢϳºɊđĄžêĈÄóĄèžđÏóêžá­ÌžêƺÏĈĄºăėÏĄº³ɐ

With that said, don’t let the word transformation scare you. It’s not
áÏÞºƺđđÏêÆž̺žĄđóĄáėêÆđĄžêĈĀážêđɐ“óė­žêºĨº­ėđºĩóėĄ³ÏÆÏ-
đžáÏêÏđϞđÏĢºĈÏêĀžĄžááºáģÏđÌĩóėĄºĨÏĈđÏêÆĈėĀĀáĩ­ÌžÏêɊèžÞÏêÆ
đĄžêĈÄóĄèžđÏóêèė­ÌáºĈĈĈ­žĄĩɐzºĈđđ̺ģžđºĄĈɊĈóđóĈĀºžÞɐĈ
žêºĨžèĀáºɊ­áóė³ɢºêž«áº³žĀĀáÏ­žđÏóêĈđ̞đÄó­ėĈóêđĄžêĈĀóĄđž-
tion, replenishment, and supply chain collaboration can provide
proof-of-value pilots in as little as 8 to 12 weeks for a subset of
your business.

zÌÏĈ­ÌžĀđºĄÆėϳºĈĩóėđÌĄóėÆÌđ̺ĀĄó­ºĈĈɐ

CHAPTER 2 Your Digital Supply Chain Playbook 17

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 'HȴQLQJ<RXU3OD\ERRNIRU
Digital Supply Chain Success
Just as a football team refers to a playbookÄóĄđ̺ĈđĄžđºÆϺĈÏđģÏáá
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will win at business.

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faster at a lower cost.

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elements:

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playbook.

18 Digital Supply Chain For Dummies, JDA Software Special Edition

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CHAPTER 2 Your Digital Supply Chain Playbook 19

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z̺­ėĈđóèºĄºĨĀºĄÏºê­ºÄóĄȪ­óèĀžêϺĈÏĈžáĈóĈÌÏÄđÏêÆĄž³Ï-
­žááĩɐȪ­óèĀžêϺĈžĄºèóĢÏêÆèóĄºđóģžĄ³ĈºáÄɢĈºĄĢÏ­ºèó³ºáĈɊ
ĀĄóĢϳÏêÆ­ėĈđóèºĄĈģÏđÌĄº­óèèºê³žđÏóêĈ«žĈº³óêđÌºÏĄĀėĄ-
­ÌžĈÏêÆĀĄóĸáºĈɐz̺Ĉº­óèĀžêϺĈ³ºáÏĢºĄž³³ÏđÏóêžáĢžáėºžĄóėê³
ºž­Ì đĄžêĈž­đÏóê «ĩ ĀĄóĢϳÏêÆ ­ėĈđóèºĄĈ ģÏđÌ ĄºžáɢđÏèº ĈđžđėĈ
updates about orders, as well as alerts about possible delays. In
addition to real-time promotions, B2B customers receive deeper
áºĢºáĈóÄĀĄó³ė­đº³ė­žđÏóêɯɠ³ºáÏĢºĄº³óêđÌºÏĄđºĄèĈɊģ̺êđ̺ĩ
žĄºĄºž³ĩđó­óêĈėèºÏđɯɠĀĄÏóĄđóèžÞÏêÆđ̺ĀėĄ­ÌžĈºɐ

CHAPTER 2 Your Digital Supply Chain Playbook 21

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 The supply chain
z̺ Ĉº­óê³ ºáºèºêđ óÄ đ̺ êºģ ³ÏÆÏđžá Āážĩ«óóÞ ÏĈ đ̺ ĈėĀĀáĩ
­ÌžÏêɐ áá đ̺ Ąž³Ï­žá ­ÌžêƺĈ 螳º đó đ̺ óĵºĄ ĄºăėÏĄº ĈėĀ-
ĀóĄđ ÄĄóè ĈÏÆêÏĸ­žêđ ­ÌžêƺĈ Ïê đ̺ ĈėĀĀáĩ ­ÌžÏêɐ zÌÏĈ ĈėĀĀóĄđ
Ïê­áė³ºĈĈėĀĀáĩ­ÌžÏêèžêžÆºèºêđĀĄó­ºĈĈºĈđ̞đ­óĢºĄĀážêêÏêÆ
žê³ºĨº­ėđÏóêÄėê­đÏóêĈɉ

» ΖQWHJUDWHGEXVLQHVVDQGȴQDQFLDOSODQQLQJ
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Old playbook
z̺óá³Āážĩ«óóÞ­ºêđºĄº³žĄóė곞áÏ꺞ĄɊ«žđ­ÌɢóĄÏºêđº³ĈėĀĀáĩ
­ÌžÏêɐ z̺ ģžĩ ĩóė Ĺóģº³ ĀĄó³ė­đ ÄĄóè đ̺ Ğ­đóĄĩ đó đ̺ ºê³
­ėĈđóèºĄ Äóááóģº³ ž ³ºĸ꺳 êºđģóĄÞ ĀžđÌ óÄ «ėĩɢèžÞºɢèóĢºɢ
store-deliver steps, and the interrelationships between these
ĈđºĀĈģºĄºĄºážđÏĢºáĩĈđžđÏ­ɐ,ÏÆėĄºɯȪɢȪĈÌóģĈđ̺óá³Ɋóėđè󳺳
process.

Source: JDA

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9êđ̺êºģ³ÏÆÏđžáº­óêóèĩɊđÌÏĈĈėĀĀáĩ­ÌžÏêĈđĄė­đėĄºÏĈêóáóê-
ƺĄ ­óèĀºđÏđÏĢºɐ zó³žĩɭĈ ÆĄÏ³ɢ«žĈº³ ĈėĀĀáĩ ­ÌžÏêĈ ėĈº ž Ĉºđ óÄ
žĈĈºđĈ đ̞đ ɩĈėĄĄóėê³ đ̺ ­ėĈđóèºĄɪ žê³ ³ĩêžèÏ­žááĩ žĈĈºè«áº
đóĀĄó­ºĈĈžê³ÄėáĸááóĄ³ºĄĈɐzžÞºž­áóĈºĄáóóÞžđÌóģđÌÏĈÆĄÏ³ɢ
«žĈº³ĈėĀĀáĩ­ÌžÏêģóĄÞĈÏêđ̺³ÏÆÏđžáĀážĩ«óóÞɐ

22 Digital Supply Chain For Dummies, JDA Software Special Edition

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 New digital playbook
zÌÏêÞóÄžÆĄÏ³ɢ«žĈº³ĈėĀĀáĩ­ÌžÏêžĈžĈºđóÄÏêđºĄ­óê꺭đº³³º­Ï-
ĈÏóêĀžđÌĈɊĀĄó­ºĈĈºĈɊžê³ĈĩĈđºèĈđ̞đºêž«áº­óèĀžêϺĈđóèžĨÏ-
èÏįº­ėĈđóèºĄÄó­ėĈžê³ĀĄóĸđž«ÏáÏđĩɞÄóĄžĢÏĈėžáɊĈºº,ÏÆėĄºȪɢȫɟɐ
ĹºĨÏ«áºÄóė곞đÏóêĈėĀĀóĄđĈ³ĩêžèÏ­ÏêÄóĄèžđÏóêĈ̞ĄÏêÆģÏđÌ
žê³ ž­ĄóĈĈ đĄž³ÏêÆ ĀžĄđêºĄĈɊ ³ÏĈđĄÏ«ėđÏóêɊ žê³ Äėáĸááèºêđ ĀóÏêđĈɐ
zÌÏĈêºģĈėĀĀáĩ­ÌžÏêÆĄÏ³­žêĀĄóĢϳº«ėĈÏêºĈĈėêÏđĈģÏđÌÏêĩóėĄ
­óèĀžêĩÆĄºžđºĄĢÏĈÏ«ÏáÏđĩđóėĀĈđĄºžèžê³³óģêĈđĄºžèêó³ºĈɐ

Source: JDA

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Ĉđ̺žĢžÏឫÏáÏđĩóÄĄºžáɢđÏ躞ê³ĀĄº³Ï­đÏĢº³žđžÏê­ĄºžĈºɊđ̺
đĩĀº žê³ žèóėêđ óÄ ÏêÄóĄèžđÏóê Ĉ̞Ąº³ ž­ĄóĈĈ êó³ºĈ ģÏáá ÆĄóģ
dramatically. Not only will this information provide you with
ÆĄºžđºĄ ĹºĨÏ«ÏáÏđĩ đó 躺đ ­óêĈėèºĄĈɭ ºĢºĄɢ­ÌžêÆÏêÆ ºĨĀº­đž-
đÏóêĈɊ«ėđÏđģÏáážáĈóºêž«áºĩóėđóĄºž­đăėÏ­Þáĩģ̺êėêĀážê꺳
ºĢºêđĈ ó­­ėĄɐ ,óĄ ÏêĈđžê­ºɊ đ̺ ģžĩ ĀĄó³ė­đ ĹóģĈ đÌĄóėÆÌ đ̺
ĈėĀĀáĩ­ÌžÏêÆĄÏ³­žêĄºž­đ«žĈº³óêĄºžáɢđÏ躳žđžĈė­ÌžĈđĄžÄ-
ĸ­ɊĀóĄđ­óêƺĈđÏóêɊžê³ģºžđ̺Ąɐ

óèĀžêϺĈɊ ºĈĀº­Ïžááĩ đÌóĈº đ̞đ óĀºĄžđº Ïê đ̺ ÌÏÆÌɢđº­Ì žê³

žĀĀžĄºá Ïê³ėĈđĄÏºĈɊ žáĈó 꺺³ đó ž³óĀđ êºģ ĈđĄžđºÆϺĈ ģ̺ê Ïđ
­óèºĈđóĄºđėĄêÏêÆèºĄ­Ìžê³ÏĈºɐiĄº³Ï­đÏêÆģÌÏ­ÌÏđºèĈģÏá᫺
returned, and on what timeframe, will become a critical part of
the supply chain plan of the future.

CHAPTER 2 Your Digital Supply Chain Playbook 23

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 ³³ÏđÏóêžááĩɊ ĈėĀĀáϺĄ ­óáឫóĄžđÏóê ģÏáá êó áóêƺĄ ž­đ žĈ ÛėĈđ ž
đóóá ÄóĄ ĀĄÏ­º êºÆóđϞđÏóêɐ 9ê đ̺ êºģ ³ÏÆÏđžá Āážĩ«óóÞɊ đÌÏĈ ĈđºĀ
ģÏááđžÞºóêèė­ÌÆĄºžđºĄĈÏÆêÏĸ­žê­ºɐÌºđ̺ĄĩóėɭĄºžĄºđžÏáºĄɊ
wholesale distributor, or manufacturer, you battle the Amazon
¸ı¸«ČɄóêĈėèºĄĈđó³žĩºĨĀº­đđó«ėĩžêĩđÌÏêÆɊÄĄóèžêĩģ̺ĄºɊ
žê³ Ąº­ºÏĢº Ïđ Ïê đģó ³žĩĈ óĄ áºĈĈɯ ɠ žê³ Ïê Ĉóèº èžĄÞºđĈ ºĢºê
ÌóėĄĈɯɠđ̞êÞĈđóèžįóêɭĈ«ėĈÏêºĈĈèó³ºáɐ

QžêėĞ­đėĄºĄĈ žê³ ĄºđžÏáºĄĈ ­žê ­óêÄĄóêđ đ̺ èžįóê ºĵº­đ «ĩ

ºêƞÆÏêÆ Ïê ÏêđºÆĄžđº³ ĈėĀĀáĩ ­ÌžÏê ­óáឫóĄžđÏóêɐ QžêėĞ­-
đėĄºĄĈ đ̞đ ³ÏÆÏđžááĩ ­óê꺭đ ģÏđÌ đÌºÏĄ ³óģêĈđĄºžè ­ėĈđóèºĄĈ
ƞÏê «ºđđºĄ ĢÏĈÏ«ÏáÏđĩ Ïêđó ³ºèžê³ ĈÏÆêžáĈ žê³ ­žê ³ºáÏĢºĄ ģÏđÌ
ÌÏÆ̺ĄžĢžÏឫÏáÏđĩžê³ģÏđÌáóģºĄóĢºĄžáá­óĈđɐzÌÏĈÏèĀĄóĢºèºêđ
ĄºăėÏĄºĈ áºĈĈ «ėĵºĄ ÏêĢºêđóĄĩ ėĀ žê³ ³óģê đ̺ ĈėĀĀáĩ ­ÌžÏê Ïê
óĄ³ºĄđóèžêžÆº³ºèžê³ĢžĄÏž«ÏáÏđĩžê³ĈėĀĀáĩ­ÌžÏê³ÏĈĄėĀđÏóêɐ
Gêóģģ̺ĄººĢºĄĩđÌÏêÆÏĈžê³ģ̺ĄºÏđ꺺³ĈđóÆóɌ

zÌÏĈ áºĢºá óÄ ­óáឫóĄžđÏóê «ºđģººê đģó ­óèĀžêϺĈ èžĩ Ĉººè

ÏèĀóĈĈÏ«áºɊ«ėđÏđɭĈêóđɐIºž³ÏêÆ­óèĀžêϺĈĀžĄđêºĄóêÌóģđ̺ĩ
ĀĄóèóđºžê³ĹóģĀĄó³ė­đĈđÌĄóėÆÌđÌºÏĄĈėĀĀáĩ­ÌžÏêĈɊ­ĄºžđÏêÆ
žģÏêɢģÏêĈÏđėžđÏóêÄóĄ«óđÌɊžĈĈÌóģêÏê,ÏÆėĄºɯȪɢȬɐ

Source: JDA

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The asset
iÌĩĈÏ­žážĈĈºđĈÏê­áė³ºĩóėĄĞ­đóĄÏºĈɊģžĄºÌóėĈºĈɞžáĈóÞêóģêžĈ
±ÍăČÿÍ©ĒČÍï竸çȸÿăóĄĈɟɊĄºđžÏáĈđóĄºĈɊđĄžêĈĀóĄđžđÏóêɊžê³ºĢºê
đ̺ĀºóĀáºģÌóèžêžÆºĩóėĄĈėĀĀáĩ­ÌžÏêĀĄó­ºĈĈºĈɐ

Old playbook
z̺ žĈĈºđ Ïê đ̺ óá³ Āážĩ«óóÞ ̞³ ž ĈÏêÆėឡ ĀėĄĀóĈºɐ ,óĄ
ÏêĈđžê­ºɊžĈđóĄºģžĈÛėĈđžĈđóĄºɐ9đģžĈÛėĈđɯɐɯɐɯɐɯđ̺ĄºɐĈÌóĀ-
per entered the store and purchased an available product. If that
product wasn’t there, the shopper couldn’t purchase it. Similarly,
žģÌóáºĈžáº³ÏĈđĄÏ«ėđóĄģžĈÛėĈđžģÌóáºĈžáºĄ³ÏĈđĄÏ«ėđóĄɊÄó­ėĈº³

24 Digital Supply Chain For Dummies, JDA Software Special Edition

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 óêĈÌÏĀĀÏêÆĀĄó³ė­đĈÄĄóèđ̺èžêėĞ­đėĄºĄđóđ̺ĄºđžÏáºĄɐzÌÏĈ
ĀĄó­ºĈĈ ĄºĈėáđº³ Ïê èóêĈđºĄɢĈÏįº ģžĄºÌóėĈºĈɊ ­óêđžÏêºĄ ĈÌÏĀĈɊ
žê³Ğ­đóĄÏºĈžĈ­óèĀžêϺĈáºĢºĄžÆº³º­óêóèϺĈóÄĈ­žáºđóĀĄó-
đº­đĀĄóĸđɐê³Ïêđ̺óá³Āážĩ«óóÞɊđ̺­óèĀžêĩóģ꺳žááđ̺Ĉº
assets, especially those dedicated to inventory transportation and
ĈđóĄžÆºɐ

New digital playbook

z̺ĈđóĄºÏĈêóáóêƺĄÛėĈđžĈđóĄºɯɠÏđêóģž­đĈžĈžèėáđϭ̞êêºá
Äėáĸááèºêđ ­ºêđºĄɐ Ĉ ĈÌóĀĀºĄĈ «ėĩ ÏđºèĈ óêáÏêºɊ ĄºđžÏáºĄĈ 꺺³
đó ĈÌÏĀ ĀĄó³ė­đ ÄĄóè đ̺ ĈđóĄº óĄ óĵºĄ ž ­áÏ­Þɢžê³ɢ­óáậđ ĈºĄ-
vice that provides online shoppers with an in-store pickup option.
óđÌđž­đÏ­Ĉºêž«áºđ̺ĈÌóĀĀºĄđóƺđđ̺ĀĄó³ė­đĞĈđºĄžĈ«ºĈđ
ĸđĈđ̺ĈÌóĀĀºĄɭĈ꺺³ĈɊžĈĈÌóģêÏê,ÏÆėĄºɯȪɢȭɐ

Source: JDA

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,óĄèóĄºÏêĈÏÆÌđĈÏêđóÌóģđ̺ĈđóĄºÏĈ­ÌžêÆÏêÆžê³ÌóģĄºđžÏá-
ºĄĈģÏáá꺺³đ󞳞ĀđɊ­Ìº­Þóėđ̞ĀđºĄɯȫɐ

qÏèÏឡáĩɊģÌóáºĈžáº³ÏĈđĄÏ«ėđóĄĈêóáóêƺĄĈºĄĢºđ̺êºĨđ³óģê-
ĈđĄºžè êó³ºɐ z̺ĩ êóģ ĈėĀĀóĄđ èėáđϭ̞êêºá óĵºĄĈɊ Ïê­áė³ÏêÆ
³ÏĄº­đÄėáĸááèºêđđóºê³­ėĈđóèºĄĈɐQžêĩģÌóáºĈžáº³ÏĈđĄÏ«ėđóĄĈ
Äėáĸáá ­óêĈėèºĄ ³ºèžê³ óėđĈϳº đÌºÏĄ đĄž³ÏđÏóêžá ³óģêĈđĄºžè
brick-and-mortar customers and have created a web pres-
ºê­º đó ³ó Ĉóɐ z̺Ĉº ­óèĀžêϺĈ ­žê êóģ Ąºž­Ì êºģ ­ėĈđóèºĄĈ
žê³ è
 žĄÞºđĈ ĀĄºĢÏóėĈáĩ êóđ ž­­ºĈĈϫẠĀĄÏóĄ đó ážėê­ÌÏêÆ đÌºÏĄ
e-commerce models.

In the new playbook, companies focus less on economies of scale,

ĈÌÏÄđÏêÆÏêĈđºž³đóžèóĄºèó³ėឡÄó­ėĈÄóĄđÌºÏĄĈžê³Ğ­-
đóĄÏºĈđó«ºđđºĄĈėĀĀóĄđĈĀºº³žê³ĄºĈĀóêĈÏĢºêºĈĈɐĈĀžĄđóÄđÌÏĈ
­ÌžêƺɊ­óèĀžêϺĈ«ėÏ᳞ê³èóĢºĈ­áóĈºĄđóèžĄÞºđ³ºèžê³ɐ
zÌÏĈèóĢºÏĈž³ÏĄº­đĄºĈĀóêĈºđóđ̺èžįóêºĵº­đɐ

CHAPTER 2 Your Digital Supply Chain Playbook 25

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 èžįóê ÄóĄºĢºĄ ­Ìžêƺ³ đ̺ ƞèºɊ žê³ ­óèĀžêϺĈ ž­ĄóĈĈ žáá
Ïê³ėĈđĄÏºĈèėĈđêóģĸÆėĄºóėđÌóģđó«ºđđºĄ­óèĀºđºɐÌºđ̺Ą
ĩóė áÏÞº Ïđ óĄ êóđɊ đ̺ èžįóê ºĵº­đ ģÏáá ÏèĀž­đ ĩóėĄ êºđģóĄÞ
ĈđĄžđºÆĩɊģ̺Ąºĩóė«ėÏá³ĩóėĄĞ­đóĄÏºĈžê³ĈɊžê³ģ̺Ąºĩóė
pre-position your inventory.

z̺ ăʜÿÍçÄ ¸«ïçïåĤȾ ĀóĀėឡÏįº³ «ĩ đ̺ Ĉė­­ºĈĈÄėá «ėĈÏêºĈĈ

èó³ºáĈ óÄ €«ºĄ žê³ ÏĄ«ê«Ɋ ­ÌžááºêƺĈ đ̺ óģêºĄĈÌÏĀ žĈĀº­đ
óÄ đ̺ žĈĈºđɐ Ĉ ĀžĄđ óÄ đ̺ êºģ ³ÏÆÏđžá Āážĩ«óóÞɊ đ̺ ­óê­ºĀđ óÄ
đ̺Ĉ̞ĄÏêƺ­óêóèĩĀĄºĈºêđĈž«ºđđºĄģžĩđóèžêžÆºÏêĢºêđóĄĩ
đĄžêĈĀóĄđžđÏóêžê³ĈđóĄžÆºɊºĈĀº­ÏžááĩÏêđ̺ážĈđèÏáºɐEėĈđ³óêɭđ
­óėêđóꀫºĄ³ĄÏĢºĄĈđó³ºáÏĢºĄážĄÆº𡞭đóĄĈžđđÌÏĈĀóÏêđɐ

z̺last mileÏêĢóáĢºĈđ̺èóĢºèºêđóÄÆóó³ĈÄĄóèđ̺ážĈđđĄžêĈ-
ĀóĄđžđÏóêÌė«đóđ̺ĸêžá³ºáÏĢºĄĩž³³ĄºĈĈɐzÌÏĈĀĄó­ºĈĈđĩĀÏ­žááĩ
ÏêĢóáĢºĈžĀžĄđϞáĈÌÏĀèºêđɊģÌÏ­ÌÏĈđ̺ĈÌÏĀĀÏêÆĈºÆèºêđģÏđÌ
đ̺ÌÏÆ̺ĈđžĈĈó­Ïžđº³­óĈđĈɯɠžê³đ̺óêºèóĈđáÏÞºáĩđóêºÆž-
đÏĢºáĩ ÏèĀž­đ ĩóėĄ «óđđóè áÏêºɐ “ºđɊ đÌÏĈ áóģɢèžĄÆÏê áºÆ óÄ đ̺
ĈėĀĀáĩ­ÌžÏêÏĈÆĄóģÏêƺĨĀóêºêđϞááĩɐ“óėĄ­óèĀžêĩģÏáá꺺³đó
ĸ곞ĀĄóĸđž«áºģžĩđóèžêžÆºđ̺ĈºĈÌÏĀèºêđĈɐ

Iºž³ÏêÆ­óèĀžêϺĈáóóÞÏêÆđ󀫺ĄɢÏįºđÌºÏĄđĄžêĈĀóĄđžđÏóêžĈĈºđĈ
áºĢºĄžÆº đÌÏĄ³ɢĀžĄđĩ áóÆÏĈđÏ­Ĉ ĀĄóĢϳºĄĈ óĄ ĀóĄđžáĈ đó ³ºáÏĢºĄ đ̺
ážĈđ èÏẠèóĄº ºĵº­đÏĢºáĩɐ \đ̺ĄĈ áºĢºĄžÆº ȫ ĀĄÏêđÏêÆɊ óĄ addi-
ČÍĝ¸ åœçĒœ«ČĒÿÍçÄ «œûœ©ÍÞÍČ͸ăȾ đó žĢóϳ đĄžêĈĀóĄđÏêÆ žê³ ĈđóĄÏêÆ
materials completely. Companies in the industrial sector adopted
ž³³ÏđÏĢº èžêėĞ­đėĄÏêÆ ăėÏ­ÞáĩɊ ºĈĀº­Ïžááĩ ÄóĄ ĈáóģɢèóĢÏêÆɊ
ºĨĀºêĈÏĢº­óèĀóêºêđĈĈė­ÌžĈÛºđºêÆÏ꺫óáđĈɐ

º ĈėĄº đó ­Ìº­Þ óėđ đ̺ êºĨđ ­ÌžĀđºĄɊ ģ̺Ąº ģº ³ÏĈ­ėĈĈ ³ÏÆÏđžá
ĈđĄžđºÆϺĈžê³đº­ÌêóáóÆϺĈĩóėɭáá꺺³đóèžÞºĩóėĄ³ÏÆÏđžáĈėĀ-
ply chain a success.

26 Digital Supply Chain For Dummies, JDA Software Special Edition

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 IN THIS CHAPTER
» Taking a look at the parts of your supply
chain

» Collaborative planning and execution

» Working with IOT

» Using automation and delivering

convenience

» Bringing it all together

&KDSWHUb 3
Creating Your Digital
Strategies and
Technologies

T
ime to put your digital playbook into action! In this chapter,
we show you the practices and technology you need to exe-
cute your well-crafted plans and how to react when your
called plays are put to the test.

Segmenting Your Supply Chain

mº­ºêđáĩɊđ̺ºê³­ėĈđóèºĄĈɭÏêĹėºê­ºóêĈėĀĀáĩ­ÌžÏê̞ĈèóĢº³
ÄĄóèđ̺ážĈđèÏáºđóđ̺ĸĄĈđɊÄóĄ­ÏêÆĈėĀĀáĩ­ÌžÏêèžêžÆºèºêđ
ºĨº­ėđÏĢºĈđóÄó­ėĈó곺áÏĢºĄÏêƳÏĵºĄºêđϞđº³­ėĈđóèºĄºĨĀºĄÏ-
ºê­ºĈɐSóđĈėĄĀĄÏĈÏêÆáĩɊ³ºáÏĢºĄÏêÆđ̺Ĉº³ÏĵºĄºêđϞđº³­ėĈđóèºĄ
ºĨĀºĄÏºê­ºĈ ÏĈ ³ÏĶ­ėáđ ³ėº đó đ̺ đĄž³ÏđÏóêžáɊ óêºɢĈÏįºɢĸđĈɢ
žáá ĈėĀĀáĩ ­ÌžÏê žĀĀĄóž­Ìɐ 9Ä Ïđ ģžĈ ºžĈĩɊ ºĢºĄĩ«ó³ĩ ģóėá³ ̞Ģº
already done it, right? But segmenting your supply chain around
your customers is a fundamental requirement to remain competi-
đÏĢºÏêđó³žĩɭĈ³ÏÆÏđžáģóĄá³ɐ

CHAPTER 3 Creating Your Digital Strategies and Technologies 27

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 Supply chain segmentation ÏĈ đ̺ ­žĀž«ÏáÏđĩ đó óĵºĄ ³ÏĵºĄºêđϞđº³
ĈėĀĀáĩ ­ÌžÏê ĈóáėđÏóêĈ đó ž³³ĄºĈĈ Ïê³ÏĢϳėžá ­ėĈđóèºĄ 꺺³Ĉ
ĀĄóĸđž«áĩɐ

To implement this process, start with segmenting your custom-

ºĄĈ«žĈº³óêđÌºÏĄ«ėĩÏêÆ«ºÌžĢÏóĄĈɊđ̺곺ĈÏÆêÏêÆĀĄó³ė­đĈÄóĄ
đ̺èžê³žáÏÆêÏêÆđ̺ĈėĀĀáĩ­ÌžÏêđó³ºáÏĢºĄđ̺ĄÏÆÌđĀĄó³ė­đĈ
đó đ̺ ĄÏÆÌđ ­ėĈđóèºĄ žđ đ̺ ĄÏÆÌđ đÏèºɐ zó Ĉđžĩ ­óèĀºđÏđÏĢº Ïê
a world dominated by digital commerce, you must continuously
align supply chain capabilities with customer demands.

zÌÏĈ­óê­ºĀđÏĈêɭđ꺭ºĈĈžĄÏáĩêºģóĄ³ÏĵºĄºêđɐQžĄÞºđÏêƳºĀžĄđ-
èºêđĈ ̞Ģº ĈºÆèºêđº³ ­ėĈđóèºĄĈ «žĈº³ óê đÌºÏĄ ³ºèóÆĄžĀÌÏ­
ĀĄóĸáºĈ žê³ ĀĄóĀºêĈÏđĩ đó ĀėĄ­ÌžĈº ÄóĄ ³º­ž³ºĈɐ ÏÆÏđžáÏįžđÏóê
ÏĈ êóģ ÄóĄ­ÏêÆ ĩóė đó ž³óĀđ đÌÏĈ ĀĄÏê­ÏĀẠđó ºĢºê ĩóėĄ ĈėĀĀáĩ
­ÌžÏêĈɐÏÆÏđžá³žđžĈÏÆêžáĈĀĄóĢϳºđ̺꺭ºĈĈžĄĩÏêÄóĄèžđÏóêđó
̺áĀĩóėė꺞ĄđÌđ̺Ģžáėº«ºÌÏê³ĈėĀĀáĩ­ÌžÏêĈºÆèºêđžđÏóêɐ

Invest in your data

GêóģÏêÆ žê³ ėĈÏêÆ ĩóėĄ ³žđž èžĩ ĢºĄĩ ģºáá «º đ̺ Þºĩ đó ĩóėĄ
ĈėĄĢÏĢžáɐžđžĹóģÏêÄĄóèèžêĩáó­žđÏóêĈÏêĩóėĄĈėĀĀáĩ­ÌžÏêɉ

» Point-of-sale (POS) systems

» Internet of Things (IoT) devices
» Social, news, events, and weather information
» Product attributes
» Customer responses

All these types of data need to be cleansed, collated, and aggre-

ƞđº³ɐ Qž­ÌÏêºɢẞĄêÏêÆ žáÆóĄÏđÌèĈ èėĈđ ­óêĈđžêđáĩ èÏêº žê³
­óê꺭đ ĢžĄÏóėĈ ³žđž ĈóėĄ­ºĈ ž­ĄóĈĈ èžêĩ ĈĩĈđºèĈ ÄóĄ ÏêĈÏÆÌđĈ
and recommendations. Think of this process like panning for
gold, but you’re shaking out data instead of gold nuggets. (Just
³óêɭđ«ÏđºĩóėĄĈđóĄžÆº³ĄÏĢºĈđóĈººÏÄđ̺ĩɭĄºÄóĄĄºžáɐɟ

Segment your customers

This step represents the foundation of a successful supply chain
segmentation strategy. Use sales transactions, social data, basket
ĈÏįºɊ³ºèóÆĄžĀÌÏ­ĈɊžê³óđ̺Ą³žđžĀóÏêđĈđóĀėđĩóėĄ­ėĈđóèºĄĈ
into homogeneous groups. Your detailed understanding of these
ĈºÆèºêđĈ ĈÌóėá³ ÏêÄóĄè ĀĄó³ė­đ ³ºĈÏÆêɊ ĈºĄĢÏ­ºɢáºĢºá óĵºĄÏêÆɊ
and supply chain strategies.

28 Digital Supply Chain For Dummies, JDA Software Special Edition

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 Align supply chain strategy
Align supply chain strategies with customers and product designs.
Understanding what customers want and how they’re likely to buy
ģÏáá̺áĀĩóė³ºĈÏÆêºĵº­đÏĢºÄėáĸááèºêđžê³ÏêĢºêđóĄĩĈđĄžđºÆϺĈɐ
9ê³ÏĢϳėžá­ėĈđóèºĄĈèžĩģžêđÄĄóêđɢ³óóĄ³ºáÏĢºĄĩóÄđ̺ážđºĈđ
gadget, so last-mile strategies become important. Corporate cus-
đóèºĄĈɊóêđ̺óđ̺Ą̞ê³Ɋèžĩ꺺³ĩóėđó̞ĢºžģžĄºÌóėĈÏêÆ
ĈđĄžđºÆĩđóÄėáĸááđÌºÏĄ꺺³ĈɐÌžđºĢºĄÏđÏĈɊ­ėĈđóèÏįºĩóėĄĈėĀ-
ply chain accordingly!

Create a visible supply chain

Supply chain segmentation requires transparency and collabora-
đÏóê žèóêÆ žáá ĀžĄđϺĈɐ QžêėĞ­đėĄºĄĈ 꺺³ đó Þêóģ Ìóģ èė­Ì
capacity to set aside and what production strategy to employ for
each segment. Logistics companies need to understand ware-
ÌóėĈÏêÆžê³đĄžêĈĀóĄđžđÏóê­žĀž­ÏđϺĈžê³ĈđžĶêÆĀážêĈɐ,ÏêžááĩɊ
ĄºđžÏáºĄĈ꺺³đóĀážêđÌºÏĄžĈĈóĄđèºêđĈžê³ÄėáĸááèºêđĈđĄžđºÆϺĈ
in accordance to the supply chain strategy, thereby completing
đ̺­ĩ­áºóÄžĈĩê­ÌĄóêÏįº³ĈºÆèºêđžđÏóêĈđĄžđºÆĩÄĄóèĈÌóĀÄĄóêđ
to factory.

5HDSWKHEHQHȴWV
Employing this segmentation strategy helps you bring in all the
Æóó³ÏºĈɐzžÞºžáóóÞžđĈóèºóÄđ̺ž³ĢžêđžÆºĈĩóė­žêĄºžáÏįºɐ

Better insights
z̺ ­žĀž«ÏáÏđĩ đó ­óáậđ ³žđž ž­ĄóĈĈ ĩóėĄ óĄÆžêÏįžđÏóê žê³ ĩóėĄ
ĈėĀĀáĩ ­ÌžÏê ºêž«áºĈ ĩóėĄ óĄÆžêÏįžđÏóê đó ÆºêºĄžđº ĈÏÆêÏĸ­žêđ
insights into your customers’ purchasing patterns and your own
operations.

Better alignment
Aligning frontline customer strategies with back-end sup-
ply chain processes helps reduce complexity and costs. Aligning
product design processes based on what your customer wants and
ģ̞đđ̺ĈėĀĀáĩ­ÌžÏꭞ곺áÏĢºĄģÏááÏê­ĄºžĈº­ėĈđóèºĄĈžđÏĈĞ­-
đÏóêžê³ẞ³đóÏê­ĄºžĈº³áóĩžáđĩžê³ĀĄóĸđĈɐ

Better speed to market

zÌÏĈĀĄó­ºĈĈ³ºáÏĢºĄĈđ̺ÞêóģẳƺóÄģ̞đĩóėĄ­ėĈđóèºĄģžêđĈ
and which products are likely to perform best in which market.

CHAPTER 3 Creating Your Digital Strategies and Technologies 29

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 Ìºê ĩóė ėĈº đ̞đ ÏêÄóĄèžđÏóê đó «ėÏá³ ž ĈėĀĀáĩ ­ÌžÏê ģÏđÌ ž
­áºžĄĀážêđó³ºáÏĢºĄɊĩóėĄóĄÆžêÏįžđÏóꭞ곺áÏĢºĄóĵºĄÏêÆĈžê³
ÏêêóĢžđÏóêĈđó­ėĈđóèºĄĈģÏđÌĈĀºº³ɐ

QžêĩóĄÆžêÏįžđÏóêĈžĄºÛėĈđĈđžĄđÏêÆđóèžÞºĈėĀĀáĩ­ÌžÏêĈºÆ-
mentation the core part of their business strategies. Relentlessly
³ºèžê³ÏêÆ­ėĈđóèºĄĈģÏááèóĢººĢºĄĩóêºÏêđ̞đ³ÏĄº­đÏóêĢºĄĩ
quickly.

qºÆèºêđÏêÆ ­ėĈđóèºĄĈ ̺áĀĈ ³ĄÏĢº ėĀ ĄºĢºêėºĈ ģÌÏẠž ĈėĀĀáĩ

­ÌžÏê ĈºÆèºêđžđÏóê ĈđĄžđºÆĩ ³ĄÏĢºĈ ³óģê ­óĈđĈɊ ĄºĈėáđÏêÆ Ïê ž
èóĄºĀĄóĸđž«áººêđºĄĀĄÏĈºɐ"ĢºĄĩóêºģÏááģžêđđóÌóĀóêđÌÏĈĄÏ³ºɐ

Digitally Enable Always-On

Manufacturing Planning
QžêėĞ­đėĄºĄĈ̞Ģº«ººêĈáóģđóđžÞºž³ĢžêđžÆºóÄđ̺ĀóđºêđϞá
Ģžáėº Ïê đ̺ ĢžĈđ žèóėêđ óÄ ³žđž óĵºĄº³ «ĩ ³ÏÆÏđžá đº­ÌêóáóÆĩɐ
QóĈđžĄº̞èĀºĄº³«ĩĈÏá󺳳žđžģÏđÌÏêáºÆž­ĩ9zĈĩĈđºèĈžê³
ẞ³ºĄĈÌÏĀĈÞºĀđÏ­žáóÄđ̺Ģžáėºžê³ÏèĀž­đóijÏÆÏđžáÏįžđÏóêɐ

QžêėĞ­đėĄºĄĈžĄºž³óĀđÏêƳÏÆÏđžáđĄºê³Ĉģ̺êĀóĈĈÏ«áºɊđÌóėÆÌɐ
³Ģžê­º³Ąó«óđÏ­ĈɊȫĀĄÏêđÏêÆɊ螭ÌÏêºẞĄêÏêÆɊžê³³žđž̞Ą-
ĢºĈđÏêÆ ­óėĀẳ ģÏđÌ ­óĈđɢºĵº­đÏĢº ĈđóĄžÆº žê³ ÏêÄóĄèžđÏóê
žêžáĩĈÏĈģÏáá³ĄÏĢºèžêėĞ­đėĄÏêÆ­óèĀžêϺĈÏêđóđ̺ÄėđėĄºɐ

Leading manufacturers are already digitally enabling an always-

óê ĀážêêÏêÆ ºêĢÏĄóêèºêđɐ Always-on planning allows companies
đó«ºđđºĄĈºêĈºžê³ĄºĈĀóê³đóĈėĀĀáĩ­ÌžÏêºĢºêđĈžê³ăėºĄÏºĈÏê
žĄºžáɢđÏèºĞĈÌÏóêɐz̺­óèĀžêϺĈ­žêđ̺곺ĢºáóĀĄÏĈÞèÏđÏƞ-
tion strategies.

z̺Ĉº ºĨžèĀáºĈ ĈÌóģ­žĈº đ̺ Ģžáėº óÄ žê žáģžĩĈɢóê ĀážêêÏêÆ

ºêĢÏĄóêèºêđɉ

» Sensors alert planners about a maintenance issue on a

production line that will delay production. Based on these new
constraint data, planners leverage what-if scenario planning
and prescriptive resolutions to update the production plan.
» End-to-end visibility capabilities, enhanced by control towers,
notify planners when a critical bill of material will not arrive
RQWLPH7KLVQRWLȴFDWLRQHLWKHUSURPSWVSUHVFULSWLYH

30 Digital Supply Chain For Dummies, JDA Software Special Edition

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 resolutions for the supply shortage or triggers the supply
chain to repair itself.
» The latest demand plan, updated frequently with inputs
from social, news, events and weather, predicts a high
probability that demand for a product will outstrip capacity.
This information triggers an additional overtime shift to
compensate for the capacity.

zº­ÌêóáóÆĩž³Ģžê­ºèºêđĈÏêĢóáĢÏêÆđÌÏĈđĩĀºóÄĄºžáɢđÏèºɊđóĀɢ
³óģêɊ èϳ³áºɢóėđɊ žê³ «óđđóèɢėĀ Ĉĩê­ÌĄóêÏįžđÏóê óÄ ÏêĀėđĈ
across demand and supply processes make these examples pos-
ĈÏ«áºɐSóđóêáĩ³óđ̺Ĉºž³Ģžê­ºèºêđĈºáÏèÏêžđº«žđ­ÌĀĄó­ºĈĈºĈɊ
«ėđđ̺ĩžáĈó³ĄÏĢºážđºê­ĩžê³ážÆđÏèºóėđóÄĩóėĄĈėĀĀáĩ­ÌžÏêɐ

³Ģžê­ºèºêđĈÏêĄºžáɢđÏèºĀĄº³Ï­đÏĢºžê³ĀĄºĈ­ĄÏĀđÏĢºžêžáĩđÏ­Ĉ
žááóģĩóėĄ­óèĀžêĩđóĀĄóž­đÏĢºáĩĀážêĄÏĈÞɢžģžĄºĈđĄžđºÆϺĈžê³
formulate contingency plans for the supply chain. In other words,
ĩóė ­žê žêđÏ­ÏĀžđº èóĈđ ºĢºĄĩ ĀóĈĈÏ«ÏáÏđĩ đ̞đ ³óºĈêɭđ ÏêĢóáĢº
žáϺêĈóĄÆϞêđèºđºóĄĈɐzÌÏĈ­žĀž«ÏáÏđĩºêĈėĄºĈđ̺èóĈđºĵº­đÏĢº
žê³ ĀĄóĸđž«áº ³º­ÏĈÏóêĈɊ èžÞÏêÆ Ïđ ĀóĈĈϫẠÄóĄ ĩóė đó èóêÏđóĄ
«ėĈÏêºĈĈ ĀºĄÄóĄèžê­º žê³ ĄºĈĀóê³ ­óáឫóĄžđÏĢºáĩ đó ³ÏĈĄėĀđÏĢº
ºĢºêđĈģÏđÌėêĀžĄžááºáº³ĈĀºº³žê³ÏêđºááÏƺꭺɐ

z̺­žĀž«ÏáÏđĩđóºĨĀáóĄºđĄž³ºɢóĵĈžèóêÆĢžĄÏóėĈĈ­ºêžĄÏóĈžê³
óĀđÏóêĈ áºđĈ ĩóė èžÞº ĀĄóĸđž«áºɊ ºĵº­đÏĢº ³º­ÏĈÏóêĈ đ̞đ èžđ­Ì
ėĀģÏđÌĩóėĄóĄÆžêÏįžđÏóêɭĈÆóžáĈɐSóđóêáĩ³óºĈđÌÏĈžáģžĩĈɢóê
ĀážêêÏêÆ ºêĢÏĄóêèºêđ ĄºĈėáđ Ïê ÆĄºžđºĄ ĀĄóĸđž«ÏáÏđĩɊ «ėđ Ïđ žáĈó
ºêž«áºĈĩóėđó³ºáÏĢºĄóê­óêĈėèºĄĈɭºĨĀº­đžđÏóêĈÄóĄžĀºĄĈóêžá-
Ïįº³Ɋ­óêĈÏĈđºêđɊžê³ĈºžèáºĈĈºĨĀºĄÏºê­ºž­ĄóĈĈžáá­ÌžêêºáĈɐ

Leverage IoT Technology to Reduce Costs

iĄº³Ï­đÏóêĈ ÄĄóè èžĄÞºđ ĄºĈºžĄ­Ì ĸĄèĈ ĢžĄĩɊ «ėđ đ̺ ÆºêºĄžá
žÆĄººèºêđ ÏĈ đ̞đ đ̺ êė諺Ą óÄ ­óê꺭đº³ ³ºĢÏ­ºĈ ģÏáá áÏÞºáĩ
increase to between 20 billion and 30 billion by 2020. The power
of IoT technology, coupled with real-time status updates from the
Ğ­đóĄĩĹóóĄɊºêž«áºèžêėĞ­đėĄºĄĈđóèóêÏđóĄ螭ÌÏ꺞­đÏĢÏđĩɊ
èžÏêđºêžê­º꺺³ĈɊžê³ĀĄó³ė­đèóĢºèºêđ³ėĄÏêÆĀĄó³ė­đÏóêɐ

These smart machines help reduce costs across the digital sup-
Āáĩ ­ÌžÏê «ĩ ĀĄóĢϳÏêÆ ³žđž đ̞đ žááóģ èžêėĞ­đėĄºĄĈ đó ž³ÛėĈđ
ĀĄó³ė­đÏóê óê đ̺ Ĺĩɐ QžêėĞ­đėĄÏêÆ áÏêºĈ ģÏáá Ąº­ºÏĢº ėĀ³žđº³

CHAPTER 3 Creating Your Digital Strategies and Technologies 31

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 schedules and quality-related information immediately. Imagine
«ºÏêÆž«áºđóáºĢºĄžÆº9óz³žđžđóĈ­Ìº³ėáºĀĄóž­đÏĢºĄºĀžÏĄĈžê³
èžÏêđºêžê­ºžê³­ėĈđóèÏįºĀĄó³ė­đÏóêđó躺đđ̞đɩ­ėĈđóèºĄóÄ
one” focus needed for success in the digital world!

The Industry 4.0 idea of the smart factory will soon be mainstream
reality. Smart products with embedded knowledge of their cus-
đóèºĄĈģÏááĀĄóĢϳº³žđžÏêĈÏÆÌđĈžê³žêžáĩđÏ­Ĉž«óėđđ̺«ºĈđģžĩ
đóĈėĀĀóĄđÄėáĸááèºêđÄóĄđ̞đ­ėĈđóèºĄɐááđÌÏĈÏêÄóĄèžđÏóêģÏáá
ẞ³đóèóĄº­óĈđɢºĶ­ÏºêđĀĄó³ė­đÏóêžê³ĀĄó³ė­đ³ºĢºáóĀèºêđɐ

Digitally Enable Real-Time Collaboration

Partners will need to collaborate across all nodes of the supply
­ÌžÏê đó ĀĄóĸđž«áĩ 躺đ ­ėĈđóèºĄĈɭ ³ºèžê³Ĉɐqºáº­đ đº­ÌêóáóÆĩ
solutions and supply chain partners that can work within and
ž­ĄóĈĈĩóėĄĢžĄÏóėĈêºđģóĄÞĈžê³đóė­ÌĀóÏêđĈɐ

"êĢÏĈÏóêÏêÆĩóėĄĈėĀĀáĩ­ÌžÏêžĈžèėáđϳÏèºêĈÏóêžá­óáឫóĄž-
đÏĢºÆĄÏ³ģÏáá̺áĀ³ĄÏĢºĀĄó­ºĈĈºĈÄóĄ³ÏĈĄėĀđÏóêèžêžÆºèºêđžê³
«ºđđºĄ ĀĄó³ė­đ èóĢºèºêđɯ ɠ žê³ ĩóėɭáá ºê³ ėĀ ģÏđÌ áºĈĈ ºĨ­ºĈĈ
ÏêĢºêđóĄĩÏêđ̺ĈėĀĀáĩ­ÌžÏêɐ

By tightly connecting planning and execution processes to

ģ̞đ ž­đėžááĩ ̞ĀĀºêĈ ģÏđÌ ³ºèžê³Ɋ ĩóėɭáá ƺđ ž «ºđđºĄ ĢϺģ óÄ
ĩóėĄ ÏêĢºêđóĄĩɐ iĄó³ė­đĈ ­žê èóĄº ºĵº­đÏĢºáĩ Ĺóģ đÌĄóėÆÌ đ̺
Ĉĩê­ÌĄóêÏįº³ ĈėĀĀáĩ ­ÌžÏêɊ áÏÞº ģžđºĄ Ïê ž ³ÏÆÏđžá èóėêđžÏê
ĈđĄºžèɐz̺ èóĄº ážđºê­ĩ ĩóė ­žê èÏêÏèÏįºɊ đ̺ èóĄº ĈėĀĀóĄđ
ĩóėɭáá ­Ąºžđº ÄóĄ žêžáĩđÏ­Ĉɢ³ĄÏĢºê ĄºĈĀóêĈºĈ đ̞đ ­óêĈϳºĄ žáá
nodes across the supply chain grid.

óêɭđ ÄóĄÆºđɊ žê ºĵº­đÏĢº êºđģóĄÞ ³ºĈÏÆê ÏĈ ºĈĈºêđϞá đó ºêĈėĄº
ĀĄóĸđž«áºĀĄó³ė­đÏĢÏđĩžê³ĹºĨÏ«ÏáÏđĩžĈĀĄó³ė­đĈèóĢºÄĄóèĀĄó-
duction to your customer’s hands.

Use Digital Data to Accelerate

Transportation Insights into Action
As competition increases and consumers become more demanding,
the entire supply chain will look to transportation professionals

32 Digital Supply Chain For Dummies, JDA Software Special Edition

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 đó ³ºáÏĢºĄ đ̺ ážĈđ èÏẠÏê ­ėĈđóèºĄ ĈºĄĢÏ­ºɐ z̺Ĉº ĈºĄĢÏ­ºĈ ģÏáá
žáĈó 꺺³ đó ĈėĀĀóĄđ đ̺ óĢºĄžáá ĀĄóĸđž«ÏáÏđĩ óÄ žáá ĈėĀĀáĩ ­ÌžÏê
participants.

Although many regard the notion of the consumer-centric supply

chain as a retail industry problem, it impacts all the participants
in the supply chain, including manufacturers, distributors, and
áóÆÏĈđÏ­ĈĀĄóĢϳºĄĈɐ

qėĀĀáĩ­ÌžÏê³ÏÆÏđžáÏįžđÏóê̺áĀĈĩóėĄº³ė­ºážđºê­ĩžđºĢºĄĩêó³º
of the supply network.

6ÏĈđóĄÏ­žááĩɊ đĄžêĈĀóĄđžđÏóê èžêžÆºèºêđ ĈĩĈđºèĈ ɞzQqɟ žĄº

Ąºž­đÏĢº «ĩ êžđėĄºɐ 6óģºĢºĄɊ ÌóáÏĈđÏ­ êºđģóĄÞ ĢϺģĈɊ ž³Ģžê­º³
óĀđÏèÏįžđÏóêĈđĄžđºÆϺĈɊ­óèĀĄºÌºêĈÏĢºĢϺģĈóÄ­óêĈđĄžÏêđĈɊžê³
ÏèĀĄóĢº³ ­žĄĄÏºĄ ĈÏÆêžáĈ ºêž«áº đĄžêĈĀóĄđžđÏóê đó Āážĩ ž èóĄº
strategic role in the supply chain.

Today, companies can use their knowledge to represent down-

ĈđĄºžèģžĄºÌóėĈº­óêĈđĄžÏêđĈžê³̞Ģºž«ºđđºĄė곺ĄĈđžê³ÏêÆóÄ
upstream replenishment plans. This knowledge allows you to act
Ïê꺞ĄĄºžáɢđÏèºɐºĈĀÏđºđ̺Ĉºž³Ģžê­ºĈɊđĄžêĈĀóĄđžđÏóêģóĄÞĈ
ģÏđÌžĢºĄžÆºĄºĀĄºĈºêđžđÏóêĈžê³Ąºž­đĈđóĈÏÆêžáĈɐz̺ĄºžáÄėđėĄº
óÄđĄžêĈĀóĄđžđÏóêģÏááèóĢºĀžĈđÏđĈÌÏĈđóĄÏ­žááĩĈđžđÏ­žê³Ąºž­đÏĢº
êžđėĄºÏêđóđ̺ĀĄóž­đÏĢºžê³ĄžĀϳáĩž³ÛėĈđÏêÆģóĄá³óÄ«ÏƳžđž
žê³ĀĄº³Ï­đÏĢºžêžáĩđÏ­Ĉɐ

Take a look at a real-world example of goods coming to North

èºĄÏ­ž ÄĄóè ĈϞ đó Ĉºº Ìóģ ĀĄº³Ï­đÏĢº žêžáĩđÏ­Ĉ ģÏáá ÄėĄđ̺Ą
ºê̞ꭺ ºĵº­đÏĢºêºĈĈ žê³ ºĶ­Ïºê­ĩɐ zÌÏĈ Ĉ­ºêžĄÏó ÏêĢóáĢºĈ ž
­óèĀáºĨĈºĄÏºĈóÄèó³žáĈđºĀĈɉ

» Pickup from supplier via truck for delivery to port

» Port operations
» Ocean voyage
» Arrival at port
» Duties and customs
» Pickup by truck for delivery to destination

đ žêĩ ÆÏĢºê ĈđºĀ Ïê đÌÏĈ ÛóėĄêºĩɊ ĈºĢºĄžá đÌÏêÆĈ ­žê Æó ģĄóêÆɊ
causing delays.

CHAPTER 3 Creating Your Digital Strategies and Technologies 33

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 ,óĄĩºžĄĈɊzQq̞Ģº«ººêėĈº³đóĄºĀĄºĈºêđêºđģóĄÞ­óêĈđĄžÏêđĈɊ
žĈģºáážĈė곺ĄĈđžê³­óĈđĈɊđÏèºÄĄžèºĈɊžê³­žĀž­ÏđĩžĢžÏឫÏáÏđĩɐ
z̺ ĀĄó«áºè ÏĈ đ̞đ ĢÏĈÏ«ÏáÏđĩ ÏĈ áÏèÏđº³ «žĈº³ óê ģ̞đ ÏĈ ºÏđ̺Ą
ÞêóģêóĄ­žê«ºžĈĈė躳ɐ"9ĈÏÆêžáĈ­žêĀĄóĢϳºĈóèºĢÏĈÏ«ÏáÏđĩ
into goods in transit, but these transmissions are often inaccurate
and untimely. This step is where many of the new digital tech-
êóáóÆϺĈģÏá᫺­óèºĄºáºĢžêđžê³žĀĀáÏ­ž«áºɐ

ÌÏẠĩóė đĄĩ đó 𡞭Þ ĩóėĄ Æóó³Ĉ ÄĄóè ĈϞ đó SóĄđÌ èºĄÏ­žɊ
èžêĩ³ÏĵºĄºêđĈóėĄ­ºĈžáĄºž³ĩÆºêºĄžđºóĄ̞Ģºž­­ºĈĈđóžèžĈ-
ĈÏĢºžèóėêđóijžđžĈė­ÌžĈɉ

» Ocean vessel GPS pings

» Weather and tidal patterns
» Historical information of sailing patterns
» Historical and active port congestion metrics
» Social and civil events

z̺Ĉº Ïê³ÏĢϳėžá ĈđĄºžèĈ óÄ ³žđž ³óêɭđ ĀĄóĢϳº èė­Ì Ģžáėº ÏÄ
ĢϺģº³ Ïê ÏĈóážđÏóêɐ ėđ ģ̺ê ĩóė Āėđ đ̺è žáá đóƺđ̺ĄɊ đ̺Ĉº
data streams form a picture of the current state of goods in transit
žê³̺áĀĩóėĀĄº³Ï­đÄėđėĄº«ºÌžĢÏóĄɐ,óĄÏêĈđžê­ºɊž.iqĀÏêÆ­žê
only tell you where a container ship is at a certain point in time.
Ìºêĩóė­óè«Ïêºđ̞đĀÏêÆģÏđÌģºžđ̺ĄɊĈžÏáÏêÆĀžđđºĄêĈɊžê³
̞Ą«óĄđĄžĶ­³žđžɊĩóė­žêÆẞêžêž­­ėĄžđºĀÏ­đėĄºóÄģ̞đđ̺
ĈÌÏĀɭĈáó­žđÏóêģÏá᫺Ïêđ̺ÄėđėĄºɞžê³ģ̺đ̺Ąđ̞đÄĄóįºêĸĈÌ
ģÏáឥĄÏĢºÏêđÏèºÄóĄqė곞ĩɭĈ³ÏêêºĄɟɐ

iĄº³Ï­đÏĢº žêžáĩđÏ­Ĉ žáĈó ̺áĀ ÏèĀĄóĢº đ̺ ážĈđ èÏẠóÄ ³ºáÏĢºĄĩɐ
zĄžêĈèÏĈĈÏóêĈóÄĄºžáɢđÏ躳žđžóêđĄžĶ­­óê³ÏđÏóêĈɊážêº«áó­Þ-
ages, and weather impacts ensure that routes change in real-time
đóĀĄºĢºêđ³ºážĩĈÏêĀĄó³ė­đ³ºáÏĢºĄĩɐ

zÌÏĈ áºĢºá óÄ ĀĄº³Ï­đÏĢº ĢÏĈÏ«ÏáÏđĩ ģÏáá ³ĄÏĢº ĈÏÆêÏĸ­žêđ Ģžáėº đó
đĄžêĈĀóĄđžđÏóê ĀĄóĢϳºĄĈ Ïê đ̺ ÄėđėĄºɐ 9èžÆÏêº «ºÏêÆ ž«áº đó
êžĄĄóģ ĩóėĄ žĄĄÏĢžá ºĈđÏèžđºĈ ÄĄóè ³žĩĈ đó ÌóėĄĈɐ Sóđ óêáĩ ģÏáá
ĩóėĄ ³óģêĈđĄºžè ĈėĀĀáĩ ­ÌžÏê 꺺³ áºĈĈ «ėĵºĄ ÏêĢºêđóĄĩɊ «ėđ
ĩóė ­žê ăėÏ­Þáĩ Ąº³ÏĄº­đ ÏêĢºêđóĄĩ đó ž³³ĄºĈĈ ­ÌžêÆÏêÆ èžĄÞºđ
dynamics.

34 Digital Supply Chain For Dummies, JDA Software Special Edition

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 Digitally Enabling Warehouse
Automation and Optimization
z̺ ­óêĢºĄÆºê­º óÄ ³ĄžèžđÏ­ ­ÌžêƺĈ Ïê ­ėĈđóèºĄ ³ºèžê³ĈɊ
žáóêÆ ģÏđÌ ­óêĈđžêđ đº­ÌêóáóÆĩ ž³Ģžê­ºèºêđĈɊ ÏĈ ẞ³ÏêÆ đó ž
ĄºĢóáėđÏóêÏêģžĄºÌóėĈº­žĀž«ÏáÏđϺĈɐqĀº­Ïĸ­žááĩɊĩóėĄóĄÆžêÏįž-
đÏóêģÏáá꺺³đó«ºĀĄºĀžĄº³đóÏèĀĄóĢºÏđĈģžĄºÌóėĈºĀĄó³ė­đÏĢ-
ÏđĩėĈÏêÆđ̺ĈºĞ­đóĄĈɉ

» Workforce technology
» $XWRPDWLRQH΍RUWV
» Optimization capabilities

Workforce technology
As Baby Boomers retire, your warehouse workforce will be
ĄºĀឭº³ «ĩ đº­ÌɢĈžĢĢĩ èÏááºêêϞáĈɐ z̺Ĉº «ĄÏÆÌđ ĩóėêÆ èÏê³Ĉ
ģÏááºĨĀº­đđóģóĄÞģÏđÌẞ³ÏêÆɢº³ÆºɊɩžĀĀáÏÞºɪđóóáĈđ̞đèÏĄĄóĄ
ģ̞đđ̺ĩėĈºÏêđÌºÏĄºĢºĄĩ³žĩáÏĢºĈɊóĄđ̺ĩģÏááĈººÞºèĀáóĩ-
ment elsewhere.

The warehouses of the future will use augmented reality and

ƞèÏêÆ­óê­ºĀđĈɊžĈºĨĀº­đº³«ĩđÌÏĈģóĄÞÄóĄ­ºɐóĄÞºĄĈģÏááėĈº
a headset or an optical head-mounted display, worn like a pair
of eyeglasses. The headset will display role-based information in
žɩĈèžĄđĀÌóêºáÏÞºɊɪ̞ê³ĈɢÄĄººÄóĄèžđɐžĄºÌóėĈºģóĄÞºĄĈģÏáá
­óèèėêÏ­žđº ģÏđÌ ĈóÄđģžĄº ĈĩĈđºèĈ ĢϞ êžđėĄžá ážêÆėžÆº ĢóÏ­º
commands to complete daily tasks.

óĄÞºĄĈ ģÏáá žáĈó Ąºáĩ óê Ąó«óđÏ­Ĉ đó Ąºèóđºáĩ ­óêđĄóá ­óèèóêɊ
ºĢºĄĩ³žĩž­đÏĢÏđϺĈžê³đžĈÞĈɐ,ėđėĄÏĈđÏ­Ąó«óđÏ­Ĉđº­ÌêóáóÆĩĈĩĈ-
đºèĈģÏáá­óè«ÏêºđžÏáóĄº³ĈóÄđģžĄºģÏđÌÏêĢºêđóĄĩĈđóĄžÆºĀó³Ĉ
žê³Ąó«óđĈđóèžêžÆºÏêĢºêđóĄĩĈđóĄžÆºɊèóĢºèºêđɊžê³ĈóĄđÏêÆɐ

zÌÏĈ đº­ÌêóáóÆĩ ģÏáá ėĈº ž ÆĄÏ³ɢ«žĈº³ ģžĄºÌóėĈº ­óêĸÆėĄžđÏóêɊ

ģÏđÌÏêĢºêđóĄĩĀó³ĈÏêđ̺­ºêđºĄɊģóĄÞĈđžđÏóêĈóêđ̺ĀºĄÏèºđºĄɊ
and a control system that directs the hardware. These technology
ž³Ģžê­ºèºêđĈģÏááêóđÛėĈđÏèĀĄóĢºĀĄó³ė­đÏĢÏđĩžê³ģžĄºÌóėĈº
ĀºĄÄóĄèžê­ºɊ«ėđģÏáážáĈó­ĄºžđºžêºêƞÆÏêƺêĢÏĄóêèºêđđ̞đ
will meet the needs of your future workforce.

CHAPTER 3 Creating Your Digital Strategies and Technologies 35

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 óĄÞºĄĈ ĄºĈĀóêĈϫẠÄóĄ èóêÏđóĄÏêÆ žê³ èžêžÆÏêÆ đÌÏĈ ÏêÄĄž-
ĈđĄė­đėĄºģÏáᳺèžê³đ̞đđÌºÏĄđº­ÌêóáóÆĩĀĄóĢϳºĄĈĈºžèáºĈĈáĩ
connect with any of these ancillary systems to get real-time
updates. This connection will ensure that any issues or challenges
žĄº ăėÏ­Þ đó «º Ąº­óÆêÏįº³ žê³ ĄžÏĈº³ ÄóĄ ºê³ɢėĈºĄĈ đó èžêžÆºɐ
These next-generation workers will expect plug-and-play tech-
nology that is easy to on-board and interact with. In other words,
these workers want information as soon as possible to act as
quickly as possible.

Automation and robots

qÏÆêÏĸ­žêđ ÆĄóģđÌ Ïê đ̺ ėĈº óÄ èžđºĄÏžá ̞ê³áÏêÆ žėđóèžđÏóê
žê³ž³Ģžê­º³Ąó«óđÏ­ĈÏêđ̺ģžĄºÌóėĈºÏĈĀĄº³Ï­đº³ɐ

A predicted labor shortage in the future will necessitate the use of

more machines to do the work done by humans today. Companies
đ̞đ ­žê èžĨÏèÏįº đ̺ ėĈº óÄ 螭ÌÏêºĈ đ̞đ ­žê ³ó đ̺ Ûó«Ĉ óÄ
humans will need to recruit, train, and retain fewer workers.

Extreme global competition will continue to exert cost pressures

óêģžĄºÌóėĈºóĀºĄžđÏóêĈɐ\êºģžĩđóž³³ĄºĈĈđÌÏĈÏĈđóèÏêÏèÏįº
human labor costs, replacing workers with robust equipment that
can operate 24/7.

Qž­ÌÏêºĈģóĄÞđÌĄóėÆÌđĩĀÏ­žáĈÌÏÄđ«ĄºžÞĈžê³žĄºêóđÆóĢºĄêº³
«ĩ ឫóĄ ážģĈɐ z̺ĩ ³óêɭđ 꺺³ đÏèº óĵ ÄóĄ Ģž­žđÏóêĈɊ žê³ đ̺ĩ
³óêɭđºĨĀºĄÏºê­ºáóĈđɢđÏ躞­­Ï³ºêđĈóĄĄºăėÏĄº«ºêºĸđĈĀž­ÞžÆºĈɐ

Satisfying customer demand

To satisfy consumers’ changing purchasing patterns, warehouses
ģÏáá꺺³đóÄėáĸááóĄ³ºĄĈÏêĈèžááºĄăėžêđÏđϺĈģÏđÌèė­ÌĈÌóĄđºĄ
ẞ³đÏèºĈÄĄóèóĄ³ºĄºêđĄĩđó³ºáÏĢºĄĩɐžĄºÌóėĈºĈģÏááėĈºèóĄº
žėđóèžđÏóêđóž³³ĄºĈĈđ̺Ïê­ĄºžĈº³Ģºáó­ÏđĩóÄđ̺óĄ³ºĄÄėáĸáá-
ment process.

Lights-out facilities ɞÄėááĩ žėđóèžđº³ Ğ­ÏáÏđϺĈɟ ģÏáá ­óêđÏêėº đó

gain traction globally, but humans will maintain a presence (if
óêáĩđóÞººĀóėĄģóėá³ɢ«ºĄó«óđÏ­óĢºĄáóĄ³Ĉžđ«žĩɟɐ6ėèžêĈģÏáá
èóêÏđóĄ žėđóèžđÏóêɊ èžêžÆº ĀĄó³ė­đÏĢÏđĩɊ žê³ ĄºĈĀóê³ đó ĀĄº-
³Ï­đÏĢºžêžáĩđÏ­ĈđóºêĈėĄºđ̺ĈºĈÏđºĈĄėêžđÄėáá­žĀž­Ïđĩžê³žĄº
­óĈđºĵº­đÏĢºɐ

36 Digital Supply Chain For Dummies, JDA Software Special Edition

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 Smart optimization
èžįóê ºèºĄÆº³ žĈ ž Æáó«žá ģžĄºÌóėĈÏêÆ ÄóĄ­º ³ėº đó ĈºĢºĄžá
Ğ­đóĄĈɉ

» Purpose-built facilities
» (ɝFLHQWVSDFHSODQQLQJ
» Optimal stock-keeping unit placement
» Robotic automation
» Well-connected planning and execution solutions

“ºđ èžįóêɭĈ ĀĄž­đÏ­ºĈ óêáĩ Ĉ­Ąžđ­Ì đ̺ ĈėĄÄž­º óÄ ĈèžĄđ ģžĄº-
ÌóėĈºóĀđÏèÏįžđÏóêɐ

\ĀđÏèÏįžđÏóê­žêÏèĀĄóĢºÌóģđžĈÞĈɊĄºĈóėĄ­ºĈɊºăėÏĀèºêđɊžê³
ÏêÄĄžĈđĄė­đėĄº žĄº áºĢºĄžÆº³ «žĈº³ óê ºĨÏĈđÏêÆ ÏêÄóĄèžđÏóê žê³
constraints.

qó Ìóģ ­žê ž ģžĄºÌóėĈº èžêžÆºèºêđ ĈĩĈđºè ɞQqɟ ÌóĀº đó

identify the most optimal next task, at a minimal cost, in a space
that is full of artifacts and constraints?

z̺èóĈđ­óĈđɢºĶ­ÏºêđɊÌÏÆÌɢĢžáėºɊžê³ÌÏÆÌđÌĄóėÆÌĀėđĞ­ÏáÏ-
đϺĈ ģÏáá ĺžđėĄº ÏêđºááÏƺêđ óĀđÏèÏįžđÏóê ĈóáėđÏóêĈ đ̞đ ­óê-
đÏêėóėĈáĩ ÏèĀĄóĢº ºĢºĄĩ đžĈÞɐ zÌÏĈ ĀĄó­ºĈĈ ĄºăėÏĄºĈ ­óêđÏêėóėĈ
ĢÏĈÏ«ÏáÏđĩ Ïêđó 꺭ºĈĈžĄĩ ÏêĀėđĈ žê³ ­óêĈđĄžÏêđĈ Ïê­áė³ÏêÆ đ̺
ÄóááóģÏêÆɉ

» 2UGHUSURȴOHV
» Delivery times
» Inventory availability and placement
» Employee and machine performance
» (PSOR\HHFHUWLȴFDWLRQV
» General facility layout bottlenecks

As people and machines work merrily throughout the day, opti-

èÏįžđÏóê ĀĄó­ºĈĈºĈ ž­đ đó ­óêđÏêėóėĈáĩ ÏèĀĄóĢº đ̞đ ģóĄÞɐ zÌÏĈ
ó­­ėĄĈ«ĩ躞ĈėĄÏêÆžê³ÏèĀĄóĢÏêÆžáááºĢºáĈóÄĀºĄÄóĄèžê­ºóê
an ongoing basis.

CHAPTER 3 Creating Your Digital Strategies and Technologies 37

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 Sºģ ž³žĀđÏĢº ẞĄêÏêÆ đº­ÌêóáóÆϺĈ ģÏáá ̺áĀ Qq ĀážđÄóĄèĈ
ž­ÌϺĢº đÌÏĈ Æóžá «ĩ ėĈÏêÆ ÏêÄóĄèžđÏóê ƞđ̺Ąº³ đÌĄóėÆÌóėđ đ̺
day, learning from constraints and other challenges. You could
ėĈº đ̺Ĉº ÏêĈÏÆÌđĈ đó ÏèĀĄóĢº ºèĀáóĩºº ĈÞÏááĈɊ ÏêĢºêđóĄĩ žĢžÏá-
ability, task accuracy, and machine reliability while better adapt-
ÏêÆđóºĨđºĄêžáĞ­đóĄĈáÏÞºģºžđ̺Ąžê³đĄžĶ­ɐSºĨđɢÆºêºĄžđÏóê
QqĈóáėđÏóêĈ̺áĀģžĄºÌóėĈºĈ«º­óèºģºááɢóÏẳɊĈèžĄđÄėáĸáá-
ment and production centers.

Deliver a Seamless Store Experience

The shopping experience that you know today will transform with
the emergence of the next-generation shopper. Born and raised
óê³ÏÆÏđžá­óèèºĄ­ºɊđ̺ĈºĈÌóĀĀºĄĈ³óêɭđ³ÏĵºĄºêđϞđº«ºđģººêž
ĄºđžÏáºĄɭĈ³ÏÆÏđžážê³ĀÌĩĈÏ­žáĈđóĄºɐ³³ÏđÏóêžááĩɊžĀĄóÛº­đº³ឫóĄ
ĈÌóĄđžÆº ģÏáá ³ĄžèžđÏ­žááĩ ÏêĹėºê­º đ̺ đº­ÌêóáóÆϺĈ 꺺³º³ đó
support the store experience.

As a retailer, you need to merge the digital store and the physical
store into one seamless experience.

The seamless store experience

ÏÆÏđžáģÏááĈėĄĀžĈĈđ̺ĀÌĩĈÏ­žáĈđóĄºžĈđ̺ĸĄĈđĈđºĀóÄđ̺ÄėđėĄº
ĈÌóĀĀÏêƺĨĀºĄÏºê­ºɐ,óĄºĨžèĀáºɊ­óêĈėèºĄĈģÏááϳºêđÏÄĩèºĄ-
­Ìžê³ÏĈºóÄÏêđºĄºĈđĢϞóêáÏ꺫ĄóģĈÏêÆžê³Ĉó­ÏžáĄžđÏêÆĈɐzÌóĈº
Ĉºáº­đÏóêĈģÏááđ̺꫺­óèèėêÏ­žđº³ĢϞžêóêáÏêºĀĄóĸáºđóđ̺
store, ensuring a high-touch retail experience when the consumer
žĄĄÏĢºĈžđđ̺ĈđóĄºɐ\ĀđÏóêĈÄóĄÌėèžêžĈĈó­ÏžđºĈɊĄºèóđºĢÏĄđėžá
žĈĈó­ÏžđºĈɊĈºáÄɢĈºĄĢÏ­ºÞÏóĈÞĈɊžê³ºĢºêĈó­Ïžáĺº³«ž­Þ躭̞-
êÏĈèĈģÏáážĈĈÏĈđ­óêĈėèºĄĈģÏđÌđ̺ĸđđÏêÆžê³Ĉºáº­đÏóêĀĄó­ºĈĈɐ
"ĢºĄĩĈđºĀóÄđÌÏĈĀĄó­ºĈĈģÏááĄºáĩóêđ̺ĀĄºĢÏóėĈáĩđĄžêĈèÏđđº³
digital shopping intelligence. That experience includes all digital
ĀėĄ­ÌžĈºĈ žê³ ĹºĨϫẠ³ºáÏĢºĄĩ óĀđÏóêĈɐ 9Ä 꺺³º³Ɋ èºĄ­Ìžê³ÏĈº
ĄºđėĄêĈɞèžêžÆº³«ĩđ̺ĄºđžÏáºĄɟģÏá᫺Ĉ­Ìº³ėẳóêáÏêºɐ

Although this may seem futuristic, we already see the emergence

óÄ ĸđđÏêÆ Ąóóè đº­ÌêóáóÆĩɐ ÏÆÏđžá èÏĄĄóĄĈ ­žê ĀºĄÄóĄè ĢÏĄđėžá
ĈÏįÏêÆžê³ĸđđÏêƳºèóêĈđĄžđÏóêĈɐGÏóĈÞĈ­žê̺áĀĈºáº­đĀĄó³ė­đɐ
mó«óđÏ­Ĉž­đđóĈÏèĀáÏÄĩĄºđĄÏºĢžáóÄèºĄ­Ìžê³ÏĈºɐ

38 Digital Supply Chain For Dummies, JDA Software Special Edition

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 “óėģÏáá꺺³ºêž«áÏêÆđº­ÌêóáóÆϺĈžê³ĈĩĈđºèĈđóĀĄóĢϳºđÌÏĈ
ĀºĄĈóêžáÏįº³ºĨĀºĄÏºê­ºɉ

» $GLJLWDOVKRSSHUSURȴOHFDQVHDPOHVVO\DQGTXLFNO\WUDQV-
pose across e-commerce, customer relationship manage-
ment, workforce, task, and IoT systems.
» Analytic systems can gather, analyze, and assimilate relevant
information at a personalized, shopper-level granularity.
These systems will serve as the foundation for enriching all
phases of the consumer shopping journey, from targeted
R΍HUVWRDVVLVWHGVHOHFWLRQDQGVHOOLQJLQWKHVWRUH
» Virtual experience technologies (which leverage intelligence
about the consumer) within the physical store.

6WDɝQJWKHVWRUH
The impending retail workforce shortage may make the high-
touch retail experience seem challenging, if not downright
ÏèĀóĈĈÏ«áºɐėđ꺭ºĈĈÏđĩÏĈđ̺èóđ̺ĄóÄÏêĢºêđÏóêɊºĢºêÏêđ̺
ĄºđžÏáĈđóĄºɐzº­ÌêóáóÆÏ­žáž³Ģžê­ºèºêđĈÏêĄºđžÏáĈđóĄºóĀºĄžđÏóêĈ
will feature next-generation capabilities for executing intelligent
ĈđóĄºđžĈÞĈžê³ģóĄÞĹóģĈɐ

IoT technology
³Ģžê­ºèºêđĈÏê9ózđº­ÌêóáóÆĩÌóá³ĀĄóèÏĈºÏêđºĄèĈóÄĄºžáɢ
đÏèºèóêÏđóĄÏêÆžê³­óèèėêÏ­žđÏóêđó𡞭ÞÏêĢºêđóĄĩɊ­ėĈđóè-
ºĄĈɊ žê³ ºèĀáóĩººĈɐ mºžáɢđÏèº ĢÏĈÏ«ÏáÏđĩ ĢϞ 9óz ģÏáá ̺áĀ ĈóáĢº
ĀºĄĢžĈÏĢº ĄºđžÏá ĈđóĄº ĀĄó«áºèĈɐ QžÞº ĈėĄº ĩóėĄ Ĉ̺áĢºĈ êºĢºĄ
ឭÞđ̺ážđºĈđĢϳºóƞèºĈĩĈđºèɯɠóĄģ̞đºĢºĄđÌóĈº­ĄžįĩÞϳĈ
want this year.

Internet of Robotic Things (IoRT)

zó³žĩɊèóĈđĄó«óđĈ̞ê³áºžėđóèžđÏóêóÄĄºĀºđÏđÏĢºĄºđžÏáđžĈÞĈɊ
Ĉė­Ì žĈ ĈđóĄÏêÆ žê³ ĄºđĄÏºĢÏêÆ ÏêĢºêđóĄĩ óĄ Āž­ÞžÆÏêÆ ĀĄó³ė­đɐ
zĩĀÏ­žááĩɊ ÏêĢºêđóĄĩ žê³ đžĈÞÏêÆ ĈóÄđģžĄº ĈĩĈđºèĈ ³ÏĄº­đ ģ̞đ
đ̺ žėđóèžđº³ Ąó«óđÏ­Ĉ ĈĩĈđºèĈ ĈÌóėá³ ³óɐ z̺ ­óêĢºĄÆºê­º óÄ
9óz­óê꺭đÏĢÏđĩģÏđÌĄó«óđÏ­ĈĩĈđºèĈđ̞đ­žêºĨº­ėđºĀĄóž­đÏĢºɊ
automated tasks and decisions based on IoT signaling is referred
đóžĈ9ómzɐɯ9ómzÏĈģ̺Ąºđ̺ÏêđºááÏƺꭺžê³žėđóèžđÏóêóÄđ̺
retail store will truly become extraordinary.

CHAPTER 3 Creating Your Digital Strategies and Technologies 39

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 Imagine a world in which IoRT in the store communicates in
ĄºžáɢđÏèº ģÏđÌ 9ómz Ïê ³ÏĈđĄÏ«ėđÏóêɊ ºêž«áÏêÆ đ̺ ºêđÏĄº Äėáĸáá-
ment model from distribution to store shelf to be fully intelligent,
accurate, and automated.

SºžĄáĩįºĄóɢđóė­ÌĄºđžÏáģÏáážáĈ󫺭ó躞ĄºžáÏđĩÏêđ̺ÄėđėĄºɐ
IoT technologies in the home and store will communicate orders
ɞÏê­áė³ÏêÆ žėđóèžđÏ­ ĄºĀáºêÏĈÌèºêđ óÄ ­ºĄđžÏê ĀĄó³ė­đĈɟ đó «º
³ºáÏĢºĄº³ ĢϞ 9ómzɢºêž«áº³ ­žĄĈ óĄ ³ĄóêºĈɐ 9đɭĈ žĈ ÏÄ đ̺ ĀÏįįž
žĄĄÏĢºĈģ̺êĩóėĸĄĈđƺđÌėêÆĄĩɌ

Ĉĩóė­žêĈººɊđ̺ÄėđėĄºóÄĄºđžÏáĈđóĄºóĀºĄžđÏóêĈģÏááĀĄóĢϳº
ºĨ­ºĀđÏóêžáĈÌóĀĀÏêƺĨĀºĄÏºê­ºĈɐ9êž³³ÏđÏóêđóđ̺ž³Ģžê­ºĈÏê
IoT and robotics, foundational elements of store operations tech-
êóáóÆĩ ģÏáá ĄºèžÏê 꺭ºĈĈžĄĩ đó ĀĄóĢϳº đ̺ ÏêđºááÏƺꭺ 꺺³º³
ÄóĄđ̺Ĉºđº­ÌêóáóÆϺĈđóģóĄÞºĵº­đÏĢºáĩɉ

» :RUNIRUFHPDQDJHPHQWVROXWLRQVFDQH΍HFWLYHO\SODQDQG
mobilize people and machines in the future.
» Category management solutions can provide the necessary
ȵRRUDQGVSDFHLQWHOOLJHQFHUHTXLUHGIRUHɝFLHQWPHUFKDQ-
dise display based on analytics of customer demand
patterns.
» Store logistics solutions can provide the intelligence for
PD[LPL]HGHɝFLHQWGHFLVLRQPDNLQJDQGLQWHUOHDYLQJRI
tasks to both people and machines.

Bringing Your Digital Strategies Together

zó đĄėáĩ ³ºĈÏÆê žê³ óĀđÏèÏįº ĩóėĄ ºê³ɢđóɢºê³ ³ÏÆÏđžá ĈėĀ-
Āáĩ ­ÌžÏêɊ ĩóė èėĈđ ĸĄĈđ ė곺ĄĈđžê³ Ìóģ ­ėĈđóèºĄĈ ģžêđ đÌºÏĄ
óĄ³ºĄĈÄėáĸáẳɐzÌÏĈÞêóģẳƺžĵº­đĈÌóģĩóėĀóĈÏđÏóêÏêĢºê-
đóĄĩžê³ឫóĄž­ĄóĈĈžááđ̺ĢžĄÏóėĈĈėĀĀáĩ­ÌžÏêêó³ºĈɊÄĄóèĞ­-
tory to store.

zóĈė­­ºº³Ïêđó³žĩɭĈ³ÏÆÏđžáģóĄá³Ɋĩóė꺺³đó­óê꺭đđ̺ĸĄĈđ
èÏáºģÏđÌđ̺ážĈđɐzÌÏĈĀĄó­ºĈĈÏêĢóáĢºĈđģóÞºĩĈđºĀĈáÏêÞº³đó
ĩóėĄĈºÆèºêđžđÏóêĈđĄžđºÆĩɐ,ÏĄĈđɊĩóė꺺³đó³ºĈÏÆêĀĄó³ė­đĈÄóĄ
who will buy them, requiring a good understanding of what your
customers will buy. Second, you need to design your supply chain

40 Digital Supply Chain For Dummies, JDA Software Special Edition

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 for how these products will be bought, impacting where you put
your facilities, and how you handle distribution.

9êĢºĈđ Ïê ž digital hub: a supply chain application strategy that

brings a digital dashboard, rapid response components, and
ÏèĀĄóĢºèºêđ ­žĀž«ÏáÏđϺĈ Ïêđó óêº ­óáឫóĄžđÏĢº ºêĢÏĄóêèºêđɐ
,ÏÆėĄºɯȫɢȩĈÌóģĈžĈžèĀáºĈđĄžđºÆĩɐ

Source: JDA

)Ζ*85(b A sample digital hub business strategy.

Enterprise-wide visibility
"ĢºĄĩóêºÞêóģĈđ̞đ³ĄÏĢÏêÆÏêđ̺³žĄÞģÏđÌóėđĩóėĄ̺ž³áÏÆÌđĈ
óêÏĈž³žêƺĄóėĈž­đÏĢÏđĩɐđ«ºĈđɊĩóėɭááÆó³óģêđ̺ģĄóêÆĀžđÌɐ
đ ģóĄĈđɊ ĩóėɭáá ­ĄžĈÌɐ “óė 꺺³ ĢÏĈÏ«ÏáÏđĩ Ïêđó ģ̞đɭĈ ̞ĀĀºê-
ÏêÆž­ĄóĈĈĩóėĄºêđÏĄºóĄÆžêÏįžđÏóêđóºêĈėĄºĩóėđĄžĢºá³óģêđ̺
right road.

zóž­ÌϺĢººêđºĄĀĄÏĈºɢģϳºĢÏĈÏ«ÏáÏđĩɊĩóėèėĈđ­óáậđ³žđžÄĄóè
đÌĄóėÆÌóėđđ̺ĈėĀĀáĩ­ÌžÏêžê³­óáážđºÏđÏêđóž­ºêđĄžáÏįº³³žĈÌ-
«óžĄ³ɐzóºêĈėĄºĩóė̞ĢºÄėááĢÏĈÏ«ÏáÏđĩž­ĄóĈĈĩóėĄóĄÆžêÏįžđÏóêɊ
­žĀđėĄºÏêÄóĄèžđÏóêĈė­ÌžĈɉ

» Consumer demand via POS data or transactional data logs

» &XVWRPHUIXOȴOOPHQWSDWWHUQVIURPGLVWULEXWHGRUGHU
management data
» Digital and IoT signals that provide product dwell patterns,
FRQVXPHUGHPRJUDSKLFSDWWHUQVDQGZRUNȵRZSDWWHUQV
» ([WHUQDOIDFWRUVWKDWD΍HFWGHPDQGDQGYLVLELOLW\VXFKDV
VRFLDOQHZVHYHQWVZHDWKHUDQGWUDɝFSDWWHUQV

,Ąóè đÌÏĈ ³žĈÌ«óžĄ³Ɋ ĩóė ­žê 𡞭Þ ĀºĄÄóĄèžê­º žÆžÏêĈđ Þºĩ

ĀºĄÄóĄèžê­ºÏê³Ï­žđóĄĈɐ,óĄÏêĈđžê­ºɊÏÄĩóėĀážêđóÄėáĸááóêáÏêº
orders in one day, regardless of cost, then the dashboard can
ĀĄóĢϳº ĢÏĈÏ«ÏáÏđĩ Ïêđó Ìóģ ĩóėĄ ­óèĀžêĩ ĀºĄÄóĄèĈ žÆžÏêĈđ đ̞đ

CHAPTER 3 Creating Your Digital Strategies and Technologies 41

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 ĈºĄĢÏ­ºáºĢºáó«Ûº­đÏĢºɐz̺³žĈÌ«óžĄ³ģóėá³ĀĄóĢϳºĩóėģÏđÌĢÏĈ-
ibility into supply chain constraints, bottlenecks, and the parts of
đ̺ «ėĈÏêºĈĈ ģ̺Ąº đ̺ ĈºĄĢÏ­º áºĢºá ĀºĄÄóĄèžê­º ³óºĈêɭđ 躺đ
your expectations.

z̺ĀóģºĄóĺêđºĄĀĄÏĈºɢģϳºĢÏĈÏ«ÏáÏđĩÏêĢóáĢºĈÞêóģÏêÆģ̞đɭĈ
going on and turning those insights into guided, actionable
information.

Supply chain modeling

Another key component of the digital hub application strategy
ÏêĢóáĢºĈĈėĀĀáĩ­ÌžÏêèó³ºáÏêÆ­žĀž«ÏáÏđϺĈđóĈėĀĀóĄđĄžĀϳ³º­Ï-
ĈÏóê èžÞÏêÆ đÌĄóėÆÌóėđ ĩóėĄ óĄÆžêÏįžđÏóêɐ .ÏĢºê đ̺ ÏêđºĄ­óê-
꺭đº³êºĈĈóÄđó³žĩɭĈĈėĀĀáĩ­ÌžÏêĈɊĩóė꺺³đÌÏĈĢÏĈėžáÏįžđÏóêɐ

Imagine that an earthquake disrupts a supplier’s plant, impacting

your factory production and schedules. This incident also hampers
ĩóėĄđĄžêĈĀóĄđžđÏóêĀážêžê³³ºáÏĢºĄĩđóđ̺ºê³­ėĈđóèºĄɐ€ĈÏêÆ
đ̺èó³ºáÏêÆđóóáɊĩóė­žêžêžáĩįºĩóėĄóĢºĄžááêºđģóĄÞɭĈ­žĀž­Ï-
đϺĈžê³­óêĈđĄžÏêđĈđó³ºđºĄèÏ꺞êžáđºĄêžđºĈėĀĀáĩ­ÌžÏêĹóģ
ĀžđÌ đ̞đ ģóêɭđ ĄºĈėáđ Ïê ³ºážĩº³ ³ºáÏĢºĄĩɐ Ìºđ̺Ą ĩóė ĈóėĄ­º
from an alternate supplier or ship from another warehouse, mod-
eling the supply chain helps you determine the right course of
ž­đÏóêÄóĄĩóėĄ­óèĀžêĩɭĈóĢºĄžĄ­ÌÏêÆ«ėĈÏêºĈĈĈđĄžđºÆĩɐ

z̺Ĉº­žĀž«ÏáÏđϺĈĈÌóėá³Ïê­áė³ºɉ

» Prescriptive analytics
» Scenario modeling and analysis
» Trend analysis
» Resolution and recommendations

Response management
ŒÏĈÏ«ÏáÏđĩ žê³ ³º­ÏĈÏóêɢĈėĀĀóĄđ ­žĀž«ÏáÏđϺĈ óêáĩ «ºêºĸđ ĩóė ÏÄ
you then put those insights and decisions into action. You need
ĄºĈĀóêĈºèžêžÆºèºêđ­žĀž«ÏáÏđϺĈɐzÌÏĈĄºĈĀóêĈÏĢºĹóģ­óêđĄóá
躭̞êÏĈèđĄÏÆƺĄĈģóĄÞĹóģĈžê³ž­đÏóêĈž­ĄóĈĈžááĩóėĄóđ̺Ą
supply chain applications.

42 Digital Supply Chain For Dummies, JDA Software Special Edition

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 z̺ĈºĈėĀĀáĩ­ÌžÏêžĀĀáÏ­žđÏóêĈĈėĀĀóĄđđ̺ĹóģĀžđÌĈÄĄóèđ̺
ĸĄĈđèÏáºđóđ̺ážĈđèÏáºɊÏê­áė³ÏêƳºĈÏÆêɊĈóėĄ­ÏêÆɊĀĄó³ė­đÏóê
ĀážêêÏêÆɊžĈĈóĄđèºêđžê³ÏêĢºêđóĄĩĀážêêÏêÆɊ³ºèžê³èžêžÆº-
ment, warehousing, and transportation. Control tower technology,
often used across manufacturing, transportation, and ware-
housing, also plays a critical role in response management. This
đº­ÌêóáóÆĩ ĈºêĈºĈ ėêºĨĀº­đº³ ºĢºêđĈ ž­ĄóĈĈ đ̺ ĈėĀĀáĩ ­ÌžÏêɊ
³ÏžÆêóĈºĈ đ̺ Ąóóđ ­žėĈºɊ žê³ ĀĄºĈºêđĈ ž ­ÌóÏ­º óÄ ­óĄĄº­đÏĢº
actions. The technology enables you to conduct what-if analysis
for each option, then make optimal guided choices that balance
ĈÌóĄđɢđºĄèĄºĈĀóêĈÏĢºêºĈĈģÏđÌáóêÆɢđºĄèĈđĄžđºÆÏ­ÆóžáĈɐºÏÆÌ
ĩóėĄóĀđÏóêĈɊđ̺êèžÞºĩóėĄèóĢºɐ

zÌÏĈ ĄºĈĀóêĈº 躭̞êÏĈè ºêž«áºĈ ĩóė đó èžÏêđžÏê ­óêđĄóá óĢºĄ

đ̺Ĺóģžê³ĀóĈÏđÏóêóÄÏêĢºêđóĄĩɊឫóĄɊžê³ĈĀž­ºž­ĄóĈĈžááóÄ
your supply chain capabilities.

“óėĄ­óèĀžêĩɭĈ­óáឫóĄžđÏĢº«ėĈÏêºĈĈĈđĄžđºÆĩÆėϳºĈđ̺³ÏÆÏ-
đžáɯ ³žĈÌ«óžĄ³Ɋ ĄžĀϳ ĄºĈĀóêĈº ­óèĀóêºêđĈɊ žê³ ÏèĀĄóĢºèºêđ
­žĀž«ÏáÏđϺĈɯ ɠ «ĄÏêÆÏêÆ đ̺è đóƺđ̺Ą Ïê ĀºĄÄº­đ ̞Ąèóêĩɐ áá
đ̺Ĉº³ÏÆÏđžáÌė«žĀĀáÏ­žđÏóêĈèėĈđ«º­óêĸÆėĄº³đó𡞭ÞĀºĄÄóĄ-
èžê­ºžÆžÏêĈđĩóėĄóĄÆžêÏįžđÏóêɭĈĀĄÏèžĄĩ­óĄĀóĄžđºĈđĄžđºÆϺĈɐ

CHAPTER 3 Creating Your Digital Strategies and Technologies 43

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 44 Digital Supply Chain For Dummies, JDA Software Special Edition

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 IN THIS CHAPTER
» +DQGOLQJWKHPDVVLYHLQȵX[RIELJGDWD

» Implementing new tools and technology

» Acting on what you know to gain a

competitive advantage

&KDSWHUb 4
Linking the IT
Department into Your
Digital Supply Chain

Y
ou can’t implement the newest software and hardware
tools without involving your friendly IT department. The
new digital world gives you unprecedented visibility into
physical assets moving across the supply chain. These advances
žáĈóĀĄóĢϳºžĈÏÆêÏĸ­žêđóĀĀóĄđėêÏđĩđóÏèĀĄóĢº­ėĈđóèºĄĈºĄ-
ĢÏ­ºɊºĶ­Ïºê­ĩɊžê³ĀĄóĸđž«ÏáÏđĩɐzÌÏĈ­ÌžĀđºĄÏêđĄó³ė­ºĈĈºĢºĄžá
ĈĀº­Ïĸ­9z­óêĈϳºĄžđÏóêĈɐ

More Information, More Data

ĈèºêđÏó꺳ºžĄáϺĄÏêđÌÏĈ«óóÞɊèžĄÞºđĄºĈºžĄ­ÌĸĄèĈĀĄº³Ï­đ
that by 2020, between 20 billion to 30 billion connected devices
will generate trillions of data points sourced from both industry
and consumers. These connected devices, often referred to as the
Internet of Things (IoT), feature heavily in many evolving initia-
tives such as Industry 4.0, the convergence of data and automa-
tion in manufacturing. The current growth trajectory for data is
tremendous; approximately 90 percent of the world’s stored data

CHAPTER 4 Linking the IT Department into Your Digital Supply Chain 45

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 were created in just the past twoĩºžĄĈž­­óĄ³ÏêÆđóq9Sz",ɐɯzÌÏĈ
trend points to IDC’s predictions of an estimated 44 zettabytes
(44 trillion gigabytes) of data by 2020.

Keeping Pace with Technology

Technology has been changing the life of mankind for centuries.
Even so, this current blistering pace of technological advance is
unprecedented. Here are three examples of everyday technology
to get a better idea of how fast the pace of change accelerated:

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VHYHQ\HDUVODWHULQWKHȴUVWSURWRW\SHRIDMHWHQJLQH
FDPHDURXQGΖWWRRNDQRWKHU\HDUVEHIRUHWKHȴUVW
FRPPHUFLDOMHWWRRNWRWKHDLULQ
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ZLWKRWKHUVWDNHSKRWRJUDSKVDQGOLVWHQWRPXVLF7KHUH
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PRGHObȃHDFKZLWKJUHDWHUIHDWXUHVDQGIXQFWLRQDOLW\bȃDWD
SDFHRIQHDUO\RQHJHQHUDWLRQSHU\HDU

Automated Decisions,
Decisions, Decisions
The new generation of digital natives in the workplace make a
big impact. Born and raised with technology, their expectations
óÄ đ̺ «ėĈÏêºĈĈ ĈĩĈđºèĈ đ̺ĩ ÏêđºĄž­đ ģÏđÌ ³ÏĵºĄ ÆĄºžđáĩ ÄĄóè
previous generations based on their experience using technology
in their personal lives. This generation expects a mobile experi-
ence that provides access to information on-the-go from intui-
tive yet immensely powerful applications. Applications powered
by sophisticated algorithms and user preference data now bleed
over from the consumer space into the enterprise, driven by the
demands of these digital natives. These users don’t want to spend
time using tools to slice and dice data to get to information or

46 Digital Supply Chain For Dummies, JDA Software Special Edition

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 make decisions. They expect software to be prescriptive and
“bring to the surface” information needed to make quick deci-
ĈÏóêĈɐ9ÄÏđ³ºáÏĢºĄĈÆóó³­óĵººžê³žĄÏ³ºÌó躞đđ̺ĈžèºđÏèºɊ
even better.

Current projections show that by 2025, millennials will comprise

ȯȭĀºĄ­ºêđóÄđ̺ģóĄÞÄóĄ­ºɊž­­óĄ³ÏêÆđóđ̺€ɐqɐɯºêĈėĈėĄºžėɐ

Tear Down the Silos!

As pointed out earlier, the digitalization of the supply chain pro-
ĢϳºĈ êºģ áºĢºáĈ óÄ ĢÏĈÏ«ÏáÏđĩɐ ,óĄ ÏêĈđžê­ºɊ ÏèžÆÏêº đ̺ «ºêºĸđĈ
óÄ Äėáá ºê³ɢđóɢºê³ ĢÏĈÏ«ÏáÏđĩɯ ɠ ÄĄóè 𡞭ÞÏêÆ Æóó³Ĉ žĈ đ̺ĩ žĄº
produced, shipped across all modes of transport, moved in the
warehouse, and delivered to the retail location (or shipped direct
đóđ̺Ïê³ÏĢϳėžá­óêĈėèºĄɟɐzóėêáó­ÞđÌÏĈóĀĀóĄđėêÏđĩɊĩóėĸĄĈđ
need to eliminate the silos that exist between the systems used to
manage these business processes across your organization.

&RPELQH\RXUVROXWLRQV
for greater value
From an IT perspective, enabling cross-solution business pro-
­ºĈĈºĈ óĄ ģóĄÞĹóģĈ ĄºăėÏĄºĈ ĈóáėđÏóêĈ žê³ ĈĩĈđºèĈ đ̞đ ºĨĀóĈº
services. This approach is often referred to as a service-oriented
architecture (SOA).

For example, take a transportation management solution that can

generate a shipment date using the least-cost carrier selection
when given basic inputs:

» 6RXUFH
» 'HVWLQDWLRQ
» 3URGXFW
» 9ROXPH
» 1HHGGDWH

All of this info arrives through a back-end system call. The

ºĨº­ėđÏóêóÄžģóĄÞĹóģó­­ėĄĈđÌĄóėÆÌđóóáĈđ̞đĀĄóĢϳºžĀĄó-
ÆĄžèèžđÏ­ģžĩđó³ºĸêºđ̺ĀĄó­ºĈĈžê³ĀžĈĈèºĈĈžÆºĈ«ºđģººê

CHAPTER 4 Linking the IT Department into Your Digital Supply Chain 47

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 systems. This enterprise service bus (ESB) allows creation of
sophisticated business logic using a graphical user interface to
orchestrate the interaction between the services in the SOA tier.

Create a platform for

consuming innovation
You could argue the impossibility of predicting when and where
technology will disrupt a market. Who would have thought that
the long-established taxi industry would have been turned upside
down and inside out? But Uber did exactly that, and it wouldn’t
have happened without the smartphones and internet that we use
in our everyday lives.

To gain competitive advantage, you must leverage innovation

from a number of software vendors and select a small num-
ber of strategic partners to give you access to a broader set of
capabilities.

Combine SOA solutions and an ESB to create new opportuni-

đϺĈ žê³ Ïê­ĄºžĈº ĀĄóĸđž«ÏáÏđĩɐ z̺ q\ɖ"q žĄ­ÌÏđº­đėĄº ĀžĄž-
digm allows you to avoid the constraints of monolithic enterprise
resource planning (ERP) systems that lock you in a single thread
of innovation. Never thought that whole all-of-your-eggs-in-
one-basket thing would come up in the high-tech world, did you?

áĈóɊq\ɖ"qžĄ­ÌÏđº­đėĄºĀĄóĢϳºĈžĀážđÄóĄèÄóĄđĄžêĈÏđÏóêÏêÆ
from on-premise solutions to cloud software-as-a-service (SaaS)
ĈóáėđÏóêĈɐqžžqĈóáėđÏóêĈ­žêĀĄóĢϳºĈÏÆêÏĸ­žêđáºĢºĄžÆºɐ

Take it to the cloud

Companies using cloud-based solutions usually move expense
from a capital expenditure to an operational expenditure, with an
expectation to reduce total cost of ownership. Initially, the move
đó ­áóė³ ģžĈ ĸêžê­Ïžááĩ èóđÏĢžđº³ɐ 6óģºĢºĄɊ ­áóė³ɢ«žĈº³ Ĉóáė-
đÏóêĈóĵºĄèžêĩêºģĄºžĈóêĈđóèóĢºɐ

$QDWXUDOH[WHQVLRQWRWKH
digital supply chain
Cloud-based solutions drive the digital supply chain because many
cross-process and cross-enterprise solutions only exist in a cloud

48 Digital Supply Chain For Dummies, JDA Software Special Edition

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 framework. Connected devices use the internet as their highway
for information, making cloud-based solutions an obvious choice.

Consuming innovations faster

Cloud-based solutions provide you a faster way to adopt and
consume innovation from your software providers. In addition,
you avoid the need to deploy, manage, and upgrade the solutions
and infrastructure. Eventually, your application landscape will
become an ecosystem of cloud-based solutions or services where
an SOA-based architecture functions in conjunction with an ESB
đóÏèĀáºèºêđģóĄÞĹóģĈɐáèóĈđĈóėê³ĈáÏÞºžêžÄđºĄɢĈ­ÌóóáĈĀº-
cial song, doesn’t it?

0DNLQJWKHLPSRVVLEOHSRVVLEOH
The current shift toward the public cloud makes it possible to per-
form work there that was previously not economically possible, or
certainly cost prohibitive. For instance, the exponential growth
rate of data makes it very expensive to keep all the information in
an on-premise infrastructure. Not even if you use a REALLY BIG
external hard drive on your laptop.

Invariably, this move forces new ideas in big data and machine
learning toward a budgetary discussion instead of a value-based
discussion. In addition, elastic computing capacity gives you
access to massive amounts of computing power on demand,
which is necessary to process large amounts of data in a timely
manner. Elastic capacity enables your organization to react and
adapt quickly to new sources of data to extract insights that can be
acted upon in meaningful ways. In other words, you get both the
brain and the muscle on-demand to get your tasks done.

Creating a Digital Mind for

Moving in the New World
As you embark on your digital supply chain journey, there are four
considerations you’ll want to keep top of mind.

CHAPTER 4 Linking the IT Department into Your Digital Supply Chain 49

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 Connecting the informational
dots matters
IoT and other internet-based sources of information create a
breathtaking amount of data. Some of those data are structured,
such as shipment rates, and other data are unstructured, such as
tweets. The true value of these data come from connecting these
information sources to derive business insights. For example,
óĢºĄážĩÏêÆ Āážê꺳 đĄė­Þ èóĢºèºêđĈ ģÏđÌ ģºžđ̺Ą žê³ đĄžĶ­
information can be used to determine on-time delivery impact
and make routing recommendations to ensure the highest level of
customer service possible under all conditions.

Finding the same insights

in an ocean of data
The conventional way users generally derive insights involves
slicing and dicing historical data through analytical tools. It is
beyond the capabilities of a human to look at such a vast array
of information constantly streaming in from connected devices.
Additionally, it is human nature to repeat what is known, tried,
and trusted. Perhaps like skipping the meal prep entirely and
reaching for a box of mac and cheese. Unfortunately, the typical
user will search the answers to the same questions, unearthing
the same insights time and time again. This approach leaves little
room for discovering new insights and is a direct consequence of
the sheer volume and velocity at which data are captured.

&RPSXWHUVȴQGQHZSDWWHUQV
The new digital supply chain leverages big data, advanced ana-
lytics, and machine learning to discover new insights and make
intelligent recommendations. The public cloud makes these tasks
more available at less expense. Computers can obviously process
much more information than humans, and machine-learning
algorithms can use this capacity to explore data with little or no
supervision from a user. Machine learning predicts future out-
comes using streaming data in real-time based on pattern rec-
ognition in a historical data set. This predictive analytics approach
óĵºĄĈ ž³Ģžê­º³ ­žĀž«ÏáÏđϺĈ ĢϞ 螭ÌÏêºɢẞĄêÏêÆ žĀĀáÏ­ž-
tion programming interfaces that are easy to consume, such as
.óóÆáºɭĈóĵºĄÏêÆɐzÏèºđóģºá­óèºĩóėĄêºģ螭ÌÏêºɢẞĄêÏêÆ
co-workers! They don’t like brownies, though.

50 Digital Supply Chain For Dummies, JDA Software Special Edition

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 Turning insights into action
Predictive analytics requires more than the enabling technology
đó ºĨ𡞭đ «ėĈÏêºĈĈ Ģžáėºɐ z̺Ĉº đóóáĈ ĄºăėÏĄº ĈĀº­Ïĸ­ ³óèžÏê
knowledge to train the models and eliminate the false positives
that can occur due to erroneous data. Machine learning, just like
a small child, can make poor decisions without an understanding
óÄđ̺ĄžèÏĸ­žđÏóêĈđ̺ĩèÏÆÌđ̞Ģºɐê³đ̺žÄđºĄɢºĵº­đĈ­óėá³
ẞ³đóž«ÏÆƺĄ³ÏĈžĈđºĄđ̞êžèºĈĈóÄ«ž«ĩÄóó³óêđ̺ĹóóĄɐ

The training process involved in creating a machine-learning

model requires domain knowledge to drive the right behavior and
make sound conclusions of insights that might be discovered. So
how do you ensure that the insights and predictions can be lev-
eraged as an actionable item? Seek partners with deep domain
knowledge, in this case, in the supply chain space. It’s kind of like
ĸê³ÏêÆžÆóó³Ĉ­Ìóóáóêđ̺螭ĄóĈ­žáºɐ

The result of the intelligence implemented through machine

learning enables the creation of a user experience suitable for
digital natives. You can present actionable insights versus placing
the burden on the user to wade through a massive amount of data.
Note that digital natives will expect this user experience as they
continue their domination of the workforce of the future.

CHAPTER 4 Linking the IT Department into Your Digital Supply Chain 51

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 52 Digital Supply Chain For Dummies, JDA Software Special Edition

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 IN THIS CHAPTER
» 'HȴQLQJ\RXUGLJLWDOVWUDWHJ\

» 0DNLQJWKHULJKWLQYHVWPHQWV

» .HHSLQJ\RXUZLWVDERXW\RX

&KDSWHUb 5
Eight Critical Success
Factors

N
ow that you’ve been given a glimpse into the future of
supply chain and have seen what is possible, it’s time to
act. The transition to a digital supply chain will happen
sooner than you expect, but there’s no need to panic. Think of this
opportunity as a new means to access new amounts and types of
data. You’ll receive greater detail and insights into your custom-
ers and operations than you’ve ever had access to before.

Digital data (increasingly available from things and people and

their interaction) enable you to gain a greater understanding of
what is happening in your business. You can then react in a way
that best serves your company’s interests. You’ll serve your cus-
tomers better, you’ll be the hero, and then you can enjoy a snack
or something.

As you embark on your digital supply chain journey, keep in mind

these critical success factors to help you win the day.

CHAPTER 5 Eight Critical Success Factors 53

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 'HȴQH<RXU'LJLWDO6WUDWHJ\
A digital supply chain will take many forms, depending on your
business model and the industry you serve. What works for one
company will not necessarily work for another. Before you embark
on any level of digital supply chain transformation, understand
žê³ ³ºĸêº ģ̞đ ³ÏÆÏđžá 躞êĈ ģÏđÌÏê đ̺ ­óêđºĨđ óÄ ĩóėĄ «ėĈÏ-
ness, the competitive framework of your company, the industry
in which you operate, and your digital value levers.

Value levers refer to the mechanisms within your organization

to manipulate and drive greater business value, such as return
óê žĈĈºđĈɊ ĄºđėĄê óê ÏêĢºĈđº³ ­žĀÏđžáɊ óĄ º­óêóèÏ­ ĀĄóĸđɐ Ìºê
³ºĸêÏêÆĩóėĄ³ÏÆÏđžáĈđĄžđºÆĩɊđžÞºž­áóĈºĄáóóÞžđģÌϭ̳ÏÆÏđžá
technologies can augment how you deploy your people, capital,
and assets to drive top- or bottom-line growth.

ÄđºĄ ĩóė ³ºĸêº ģ̞đ đ̺ ³ÏÆÏđžá ĈėĀĀáĩ ­ÌžÏê 躞êĈ đó ĩóė žĈ
a company, determine what value levers to pursue and how to
execute against that digital strategy. For instance, are you focused
primarily on delivering a better customer experience? Or are you
Äó­ėĈº³ ĀĄÏèžĄÏáĩ óê Ïê­ĄºžĈÏêÆ ĀĄóĸđɑ ÌžđºĢºĄ ĩóėĄ ĀĄÏèžĄĩ
aim, your digital strategy will need to align and support your over-
arching corporate strategy. A high-growth, low-margin business
ģÏáá ĄºăėÏĄº ž Ĉė«ĈđžêđϞááĩ ³ÏĵºĄºêđ ­óèĀžêĩ ĈđĄžđºÆĩ đ̞ê ž
business focused on maximizing margin. Regardless of your com-
pany strategy, your digital strategy needs to complement it. Think
of your digital strategy as a digital thumbprint — something that
is unique to your organization (just with less messy ink).

Going digital means you can support multiple supply chain strat-
egies. Smart companies leverage intelligence from a multitude of
digital data sources. Segment your customer base, your product
lines, your geographies, and all of those intersection points to
³ĄÏĢºÆĄºžđºĄĀĄóĸđžê³­ėĈđóèºĄáóĩžáđĩɐmºÄºĄđó̞ĀđºĄɯȫÄóĄž
refresher on segmentation.

It All Starts at the Top

The executives in your organization must embrace the poten-
tial impact of digital capabilities and your digital strategy. The
êºģ³ÏÆÏđžáģóĄá³žĵº­đĈđ̺ºêđÏĄº«ėĈÏêºĈĈɊÄĄóèđĄžêĈÄóĄèÏêÆ

54 'LJLWDO6XSSO\&KDLQ)RU'XPPLHV -'$6RIWZDUH6SHFLDO(GLWLRQ

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 supply chain processes to altering the types of products and ser-
vices your company delivers to the market.

In the past few years, leading companies elevated digital initia-

tives to the executive level of the business by hiring chief digi-
đžá óĶ­ºĄĈ óĄ ­ÌϺÄ žêžáĩđÏ­Ĉ óĶ­ºĄĈɐ z̺Ĉº êºģ ³ÏÆÏđžá ẞ³ºĄĈ
work with teams or centers of excellence to identify leverage
points across the business that can add value. Many executives
have achieved success with this approach. Teams involved should
include marketing, e-commerce, and supply chain. Often, these
functions deploy digital strategies independently, leaving oppor-
tunities for value or future challenges on the table.

z̺ ­ÌϺÄ ºĨº­ėđÏĢº óĶ­ºĄ èėĈđ ³ĄÏĢº ž ³ÏÆÏđžá žÆºê³ž đ̞đ ģÏáá
«ºêºĸđ «óđÌ Ĉ̞ĄºÌóᳺĄĈ žê³ ­ėĈđóèºĄĈɐ .žÏê óĄÆžêÏįžđÏóêžá
support of the digital strategy by engaging in a change manage-
ment process. Assign a member from the executive leadership
team to collaborate upon and deliver the holistic strategy.

'LJLWDO6XSSO\&KDLQV5HTXLUH
1HZ&RPSHWHQFLHV
The number of things connected to the internet will grow dra-
matically. This level of digital connectivity will obviously produce
a wealth of new data. Data science will become a core competency
in this digital world, requiring businesses to become math houses.
Resist the temptation to think of fraternal organizations solving
complex equations. These internal and external math houses will
form to solve problems existing at the fringe of existing solutions.

Today, processing information about social, news, events, and

weather, along with predictive and prescriptive analytics and
machine learning, can add tremendous value to your replenish-
ment planning, inventory deployment, and demand management
activities. You can also use this information to gain competitive
advantages over your competitors. But you can only gain these
advantages if you know how to use the data.

CHAPTER 5 Eight Critical Success Factors 55

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 9LVLELOLW\$ORQHΖV1RWWKH(QG*RDO
Right now, you can access supply chain systems that model the
ĄºžáģóĄá³ģºááɐ“ºđɊĩóėèėĈđĄº­óêĸÆėĄºđÌÏĈĈđžđÏ­èó³ºáóĢºĄ
đÏèº đó ĄºĹº­đ ĄºžáɢģóĄá³ Ĉ­ºêžĄÏóĈɐ zÌÏĈ đĩĀº óÄ Ąº­óêĸÆėĄž-
tion will increasingly occur in real-time, providing you with an
unprecedented level of real-time supply chain visibility. Yet vis-
Ï«ÏáÏđĩžáóêºÏĈêóđĈėĶ­ÏºêđÏÄĩóė­žêɭđž­đóêđÌÏĈêºģáºĢºáóÄ
information.

For instance, you must decide how you’re going to take those
­žĀž«ÏáÏđϺĈ đ̞𠞥º ºêđĄºê­Ìº³ Ïê ž 螭ÌÏêº óê ž Ğ­đóĄĩ ĹóóĄ
and leverage the real-time information you receive. If you learn
that a machine is breaking down through sensors and Internet
of Things (IoT) technology, you can use that information to alert
maintenance, enabling you to avoid a problem that could lead to
production delays. The donut-making will continue unabated!

In this area, control tower technology will gain importance in

the future thanks to this movement to real-time visibility. The
capability to understand what’s happening globally in your sup-
ply chain at any point in time and to react faster and smarter than
any of your competitors will give you an edge. The company that
ĸê³Ĉ óėđ ž«óėđ ž ­žĀž­Ïđĩ ĈÌóĄđžÆº ĞĈđºĄɊ ė곺ĄĈđžê³Ĉ Ìóģ đó
best respond, and reacts quickly to snap up capacity elsewhere
will do so at the expense of its competitors.

Going digital will not solve all your problems. You can build a
digital supply chain that gives you access to unprecedented levels
of new information and still make poor decisions.

ΖQYHVWLQ'LJLWDO7DOHQW
As supply chain-related information becomes more transparent
and visible across your organization, you’ll see a convergence of
supply chain processes and roles. This transformation will require
ĈÏÆêÏĸ­žêđ ­ÌžêƺĈ žê³ ĹºĨÏ«ÏáÏđĩ Ïê ºèĀáóĩºº ĈÞÏááĈºđĈɐ mºžáɢ
đÏèºĢÏĈÏ«ÏáÏđĩžê³­óáឫóĄžđÏóêģÏáá̺áĀ­ĄºžđºèóĄºĹėϳóĄÆž-
nizations and remove some management layers.

Your organization will need to rethink its recruiting practices

to hire more graduates and professionals with data science and

56 'LJLWDO6XSSO\&KDLQ)RU'XPPLHV -'$6RIWZDUH6SHFLDO(GLWLRQ

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 predictive analysis skillsets. You will also need to consider the
personality types of these new employees. Younger generations
typically appear more tech-savvy than older employees. As digi-
tal natives, they share information digitally, rely on devices to
deliver knowledge, and expect most decisions to be made in col-
laboration with peers or with smart technologies. These expec-
đžđÏóêĈ ģÏáá ÏêĹėºê­º ģ̺Ąº đ̺ĩ ģžêđ đó ģóĄÞɐ QžÞº ĈėĄº ĩóėĄ
corporate culture attracts and retains top digital talent.

.HHSDQ(\HRQWKH&RPSHWLWLRQ
Adopt a digital supply chain strategy to remain competitive in the
ÄėđėĄºɐ Ĉ ĩóė ­óèĀºđº ģÏđÌ ­áóĈºɢđóɢįºĄó ĀĄóĸđ èžĄÆÏê «ėĈÏ-
nesses like Amazon, you may be driven by your competitors to do
things that you wouldn’t normally do. At some point, you’ll need
to grab as much market share as you can, create as much of a loyal
ÄóááóģÏêÆžĈĀóĈĈÏ«áºɊžê³đ̺êÌóĀºÄėááĩĀÏ­ÞėĀĀĄóĸđž«ÏáÏđĩóê
the back end through long-term relationships. Digital strategies
will play a critical role in accomplishing some of these objectives.

Ìºê ÏêĹėºêđϞá ĀážĩºĄĈ áÏÞº èžįóê žê³ €«ºĄ èóĢº èžĄÞºđĈɊ

it doesn’t matter how smart you are or how smart you try to be.
You must capture market share to avoid becoming marginalized
in the future.

$FFHSW7KLV1HZ5HDOLW\
The next-generation supply chain involves increasingly dynamic
models, made possible by the availability of digital data points
from everywhere. This information provides much more precise
synchronization among manufacturing, warehouses, stores, and,
ultimately, end customers. These dynamic and smarter supply
chains will sense, process, react to, and learn from those data over
time. The faster you can accept this reality, the faster you can move
your organization toward the digital supply chain of the future.

9èžÆÏêº ž èžêėĞ­đėĄÏêÆ ĀĄó³ė­đÏóê áÏêº óėđĸđđº³ ģÏđÌ ĈºáÄɢ

monitoring smart machine components that can automatically
transmit status or need for repair. Mobile-connected users could
­óáậđžê³žêžáĩįº³žđžóêđ̺ĹĩɊž³ÛėĈđÏêÆĀĄó³ė­đÏóêžĈ꺺³º³
and informing other parties across the enterprise. Beyond that,

CHAPTER 5 Eight Critical Success Factors 57

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 production facilities, connected via IoT, could share capacity and
constraint information, enabling companies to shift production
ÄóĄÆĄºžđºĄĀĄóĸđž«ÏáÏđĩžê³đó躺đ­ėĈđóèºĄ꺺³ĈɐzÌÏĈÏĈêóđž
Jetsons-like fantasy, but examples of technology that exist now.

The process of transforming big data into actionable information

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more competitive.

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Instead of trying to tackle a grandiose initiative, pick a business
area and explore where technology can add value.

Take a look at the type of business problem to solve and examine

the types of technologies that could help solve the problem. At the
same time, look at what’s possible with some of the newer tech-
nologies. Examine how they solved a problem. You could also use
a seemingly similar technology approach to solve a completely
³ÏĵºĄºêđđĩĀºóÄĀĄó«áºèÏêĩóėĄóĄÆžêÏįžđÏóêɐ.ÏĢºêđ̺Āž­ºóÄ
technological advancements, especially today, you’ll want to look
at it both ways.

Develop working pilots that allow you to fail fast. This accelerated
approach of deploying new technologies via the cloud shifts the
paradigm to one of continuous releases, enabling you to learn les-
sons fast and drive innovation. By enabling legacy applications to
co-exist with new-generation technologies, you’ll mitigate risk
and squeeze the most value out of your existing physical and IT
assets. As you move forward with new technologies like predictive
analytics or machine learning, you can apply that value to your
existing assets. Enable the future while honoring the past. That’s
deep, isn’t it?

Whatever you do, though, you better get started. Digital tech-
nologies are beginning to impact every aspect of business, and
this disruption will cause some companies to succeed and others
đó ĞÏáɐ Ąºžđº ž ĈđĄžđºÆĩ đ̞đ ĄºĈĀº­đĈ đ̺ ĀžĈđ ģÌÏẠèóĢÏêÆ žĈ
quickly to the future as possible.

zóĀžĄžĀÌĄžĈºEºĵºįóĈɉɩèžįóê³Ï³êóđ̞ĀĀºêđó«óóÞĈđóĄºĈɕ
the future happened to bookstores.”

58 'LJLWDO6XSSO\&KDLQ)RU'XPPLHV -'$6RIWZDUH6SHFLDO(GLWLRQ

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 Appendix

Glossary
3D printing: The process of using a three-dimensional digital model to
create a physical object, which is built using successive layers of material
during the printing process. Also referred to as additive manufacturing.

advanced analytics: The systematic analysis of data or statistics to

derive meaningful patterns of information. Supply chain practitioners
often use advanced analytics to uncover insights about their customer
and supply chain activities and make prescriptive changes.

automation: The use of machines and technology to operate or control

a process by automatic means, thereby minimizing (and often eliminat-
ing) the need for human intervention or input.

beacon: A technology-enabled device that alerts apps or opt-in websites

when a user is nearby a location. For example, beacons can push a
coupon to your mobile device when shopping.

big data: Extremely large structured, semi-structured, and unstructured

data, which can be mined for critical information.

data harvesting: The process of extracting data from websites. Data

harvesting can also be referred to as data mining.

decision-support capabilities: An application that analyzes data,

enabling users to make better business decisions.

digital native: A person born during the age of digital technology and
raised using the Internet and computers.

digitalization: The process of using digital communication, technology,

and data to enhance business strategies, processes, insights, collabora-
tion, and more.

digitization: The process of converting information into a digital format.

APPENDIX Glossary 59

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 Enterprise Service Bus (ESB): A tool that allows sophisticated business
logic to be composed using a graphical user interface to orchestrate the
interaction between the services in the Service-Oriented Architecture
tier.

Industry 4.0: The fourth industrial revolution, which involves the

convergence of automation and data exchange in manufacturing
technologies, made possible by the Internet of Things.

machine learning: $QDUWLȴFLDOLQWHOOLJHQFHWHFKQLTXHIRUSURFHVVLQJELJ

data based on algorithms that recognize data patterns, learn from the
SDWWHUQVR΍HULQVLJKWVDQGEHFRPHVPDUWHUWKURXJKWLPHMXVWDV
humans do.

optimization technology: Technology used to improve how tasks,

UHVRXUFHVHTXLSPHQWDQGLQIUDVWUXFWXUHDUHOHYHUDJHGEDVHGRQ
existing information and constraints.

point-of-sale (POS) data: Data collected when a retail transaction

completes.

predictive analytics: A type of advanced analytics used to make

predictions about unknown future events.

prescriptive analytics: $W\SHRIDGYDQFHGDQDO\WLFVWKDWLGHQWLȴHVWKH

best course of action for a given situation.

sensor: A device that detects or measures an input, such as light,

motion, or sound, related to a physical environment and responds by
transmitting the information digitally.

Service-Oriented Architecture (SOA): This type of software design

enables services provided to other components by application compo-
nents through a network communication protocol.

smart machines: Intelligent devices, such as robots or self-driving cars,

that use machine-to-machine technology to make decisions without
human intervention.

Software-as-a-Service (SaaS): A software licensing and delivery model

that licenses centrally hosted software on a subscription basis.

zero-touch retail: A retail environment managed entirely by technology

and technology-enabled products to support the purchase and delivery
of orders without human intervention.

60 Digital Supply Chain For Dummies, JDA Software Special Edition

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 Notes

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
 Notes

These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
These materials are © 2017 John Wiley & Sons, Inc. Any dissemination, distribution, or unauthorized use is strictly prohibited.
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