COVID-19: supply chain, information and digital transformation

COVID-19 has accelerated digital transformations all over the globe. As Satya Nadella, CEO of Microsoft stated: “We have seen two years of digital transformation in two months. From remote work and classes, sales and customer service to cloud-based infrastructure and security".

Moreover, many people have supported what Nadella said. However, even though many commercial operations were transformed quickly, other key processes resisted digital acceleration. Supply chains are a very good example: operations that depended on spreadsheets had to be revised completely.  

Understandably,  companies try to find the digital advantage of the needs produced by the pandemic. 

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Why? As Mike Tyson once said: "Everyone has a plan until they get punched in the face". The great impact that COVID-19 had on companies showed that continuity plans of supply chains had correct and incorrect information. The executives of several companies couldn't see what was happening (or had to happen) to guarantee safe and reliable deliveries under coercion. This was shocking. The information (not just digitization) was the immediate problem. Different teams had to understand that the decisions made based on information foster a successful transformation of the supply chain. 

In other words, the policies, and practices that foster access to real-time information in each relevant link of the supply chain became very important. As companies face their global future in a post-pandemic world, automatic learning and contexts became pressing.

We've talked with over a dozen managers and executives about supply chains since pandemic lockdowns began. Almost all of them have rearranged the strategic priorities of their supply chains. "Just in case" is now more important than "just in time". Guaranteeing workers' safety now replaces improvement of inventory shifts. 

"Honestly", an executive of the supply chain of industrial and food teams said, "we hadn't realized how little we knew about our key suppliers until COVID-19 broke out. We had to gather all type of [new] information about them and we had to give them information that we didn't use to give to make our companies work".  

In conclusion, digital business success, first, needs clarity in the design of the supply chain. In other words, for a company to be digitally transformed, it should be transparent. Transformational transparency is what leadership needs to measure; visibility is what leadership needs to assess. Unless you first determine the access to information, its quality, and lineage, digitization can offer agility and reliability. 

<<<< Lesson learned? What COVID-19 left in companies >>>

This is the most important organizational (re) learning that the COVID-19 crisis left us. Digitizing the improvements in the supply chain process that was undefined, gathering and classifying important information deliberately encodes blind spots. Alternative solutions won't work without the ability to see, find or gather important information quickly. Where does that information come from? Who's the owner? How and why is it accessible?