Putting employees at the heart of digital supply chain transformation
In this article written exclusively for Business Leader, Claire Rychlewski, SVP EMEA at Kinaxis, discusses the importance of putting employees at the heart of digital supply chain transformation.
This follows our recent interview with Chaitanya Rajebahadur about what digital transformation will look like in 2022.
It is no secret that digital is the future, with many companies accelerating their digital transformation journeys as a result of the pandemic. However, more than 50% of organisations have not yet actively started building a roadmap to implement a supply chain digital transformation despite Gartner’s evidence that it increases the chances of success threefold. A clear and detailed roadmap starts with understanding business needs and what’s not working as it should. This then allows supply chains leaders to prioritise investments to reach both short-term and long-term plans in agreed timescales, without unnecessary costs or excessive detours.
The transformation is on no account an easy and quick task, meaning different things for different companies. For some, it signifies replacing manual processes and operational silo’s with digital data and artificial intelligence. For others, using autonomous robots to speed up operations. Whatever the definition and vision, there are many benefits that can arise from digitally transforming supply chains, from supporting business growth and greater resilience to risk mitigation and cost optimisation.
While crunching the numbers and looking at the technical capabilities, companies often overlook one crucial element binding all the supply chain function together – the employees. In many cases, it is employees who flag the need and urgency to undergo the transformation in the first place as they struggle with repetitive and laborious processes and outdated technologies. It is they who will see the benefits of the digital world day-to-day too, driving profits and innovation with more agile and robust supply management. Therefore, organisations must put employee engagement and experience at the heart of supply chain evolution.
Listening to employee feedback
Many changes to supply chain management are – and should be – influenced by employee feedback. Old-fashioned, post-world war processes combined with not fit-for-purpose tools and technologies are often driving employees to voice their concerns over inefficient operations and lack of technical capabilities. From processing every report and correcting every order manually to poor visibility on the production line and customer forecasting, employees’ pain-points shine a light on the areas that could benefit the most from transforming.
However, it is alarming that 79% of business leaders admit they do not review internal processes before setting KPIs for a transformation project. The lack of clarity often jeopardizes the success of digital transformation strategies. as supported by the MCA finding that 84% of them fail due to lack of purpose and guidance. Employees hold the invaluable knowledge about which processes are stagnant and too old-fashioned to provide businesses with the much-needed ability to adapt to the changing market situation, supply and demands. However, that can only happen once the leaders see the real value and take action on employee feedback and experiences.
When putting together digital supply chain transformation strategies, it is important to listen and recognise the daily challenges employees face for two reasons. First one is employee retention as those employees who feel valued and listened to are not only more likely to stay longer within the business, but they are also going to put their time, skills and effort into ensuring the success of those strategies. The second reason closely relates to the bottom line itself because if businesses focus on transforming low-priority elements first, it is unlikely they will improve operational efficiencies and drive any revenue growth in today’s competitive landscape.
Employees leading the change
According to Gartner, over 80% of organisations are currently managing change from the top down. This strategy is, however, fundamentally disconnected from today’s workflow, slowing businesses down as a result. The most successful organisations rely highly on their workforce, not the C-suite, to be the change agents leading the shift towards more connected and intelligent supply chains. It is, therefore, important to give employees a voice and put them at the heart of transformation strategies to avoid resistance, and instead see tangible benefits for years to come.
On the journey from scale-driven, siloed supply chains to digitally interconnected and intelligent ones, employee experiences and insights should be front and centre. Implementing changes within the supply chain can take anywhere between 12 to 18 months, with the majority of employees needing at least that long to embrace new working models and the latest tools. Thus, it is important to include them in the process from the start, give them access and comprehensive training to start embracing the change with confidence, new skills and technical abilities.
With executable, measurable and timed digital transformation strategies, as well as strong leadership and direction, employees increase chances of success and will give the business every opportunity to boost performance. A change-ready, well-informed workforce is a key ingredient to form an agile supply chain of the future.
Building supply chains of the future
For too long businesses have approached implementing changes without placing their most important asset – employees at the heart. Supply chain digital transformation projects are not a one-off, tick-box exercise, but rather a continuous process that never stops. Hence, it is important to have employees as advocates and drivers of the change to ensure better technological adoption and higher resilience of interconnected supply chains.
With positive employee experiences and engagement, a modern supply chain can benefit from greater collaboration and smoother information flow between different functions. The people-centric, human-first approach will ensure supply chain transformations stand a better chance of capturing the full value that automation, machine learning and AI can provide.