Supply chain innovation is important for organisations of all sizes and allows them to develop new ways to satisfy customer needs, increase revenue and become more efficient and sustainable.
For private sector organisations, supply chain innovation is crucial for increasing profits, reducing costs, and staying ahead of the competition. Whereas for public sector organisations, innovation is vital to improve service outcomes and save public money.
Navigating logistical and economic challenges caused by natural disasters, unpredictable geopolitical events and trade wars is not new territory for supply chain managers.
However, with the recent unforeseen global COVID-19 pandemic and the current Ukraine war, many organisations are struggling to find suitable suppliers to continue offering their goods and services or find a new way to innovate.
While innovation is often considered by many organisations as a way to grow in the future, with more global supply chain disruption expected, many are having to prioritise innovation now to survive, let alone thrive.
Fortunately, with every challenge, comes opportunity and this is a period in which supply chain management must adapt to stay ahead of the competition.
The Challenge for Organisational Innovation
Many organisations rely heavily upon their supply chain and need to source scarce or obsolete materials, components and products to ensure business continuity. If an organisation cannot source the products they need, or cannot source them at the right price within the right time frame - supply chains collapse resulting in massive commercial risk with huge impact. For these organisations, diversifying and de-risking the supply chain is crucial and it can be challenging to find suitable suppliers that they can rely on.
Some organisations are looking to source new products and services from innovative new suppliers - mostly for research and development to drive new revenue streams and efficiencies.
Additionally, the Government has set out new plans to transform procurement reform so that public sector organisations can work more with small businesses to deliver regional prosperity.
For these organisations, while they are keen to find ways to innovate, it can be challenging to identify and pre-qualify SMEs to collaborate with. There is also the transactional burden of innovation and the challenge of managing lots of small suppliers that can often hold them back.
How Organisations Can Improve the Supply Chain and Innovate for Future Growth
Innovation for the supply chain can consist of several improvements and changes. While implementing new products and services can diversify an organisation's offering, improve outcomes and their bottom line, a continuum of small improvements to processes can also make a big impact.
Supply chain innovation isn’t just about creating new things and increasing sales- it’s about improving existing products, services and processes. Oftentimes it can be the smallest changes that reap the biggest rewards.
In fact, according to a study conducted by Kenco, 85% of supply chain leaders define innovation as “process improvements” or “business model innovation”.
The supply chain can be considered the backbone of an organisation. While it supports so many parts of the business, with too much change or pressure, cracks can start to form with widespread impact. Given this, it’s down to supply chain managers to assess the organisation's current innovation efforts and measure the value of implementing new ways to meet customer demands and improve costs, efficiency and outcomes.
By utilising technology, organisations can seamlessly connect and cross-collaborate with partners and enable the flow of new supplier capabilities to identify new opportunities that achieve organisational goals.
This method of digital transformation is built upon a new level of transparency, information sharing and communication between a wider network of organisations where savings and opportunities are generated and shared between business partner organisations to increase efficiencies and improve interoperability - resulting in “win, win” relationships. This is ideal for organisations that are seeking immediate solutions to fix supply chain gaps as well as for those focusing on long-term growth.
While the benefits of implementing technology are clear, according to The Economist, less than 40% of executives have introduced digital platforms into their organisation within the last three years, with less than a third using cloud computing and the Internet of Things.
Many organisations are fixated on the cost associated with innovation and this often halts progress. However, in a competitive and challenging economic climate, organisations that are willing to invest in the right technology can solve current challenges as well as plan for the future.
The future of the supply chain is based on collaboration, connectivity and agility, and most importantly, resilience. Supply chain leaders need to be willing to look beyond their existing and historical ways of operating and welcome new ideas to stay ahead of the competition.
At SimplyDo, we provide the infrastructure to generate ideas inside and outside of your organisation to rapidly find new suppliers and solutions to solve your biggest challenges.
Book a discovery call to find out more!
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