An often-used catchphrase that can send even the most tech-savvy procurement professional running for the hills, digital transformation doesn’t actually have to be difficult, time-consuming, disruptive, or expensive. By taking small steps in this direction, companies of all sizes can begin to experience major “wins” like time savings, efficiency improvements, cost savings, and more streamlined operations.
What is Digital Transformation?
Digital transformation simply means “adapting an organization’s strategy and structure to capture opportunities enabled by digital technology,” according to Harvard Business Review’s definition. This is not a new challenge, the publication adds. “After all, computers and software have been around for decades and have brought changes both to products and services and to how we make and deliver them.”
Borrowing a popular phrase coined by Desmond Tutu, who said, “there is only one way to eat an elephant: a bite at a time,” digital transformation is a project that’s usually best tackled one step at a time. This is an area where small wins compound upon themselves and, over time, can turn into major gains for organizations.
Take data automation, for example. On a basic level, data automation relates to the documents (e.g., spreadsheets containing parts, price and availability data) that a buyer and a seller of electronic components exchange as they facilitate either a purchase or a sale. The same goes for supply chain automation, which lets companies leverage artificial intelligence (AI), machine learning (ML), Robotic Process Automation (RPA), Optical Character Recognition (OCR) and/or robotics to lower the operational cost of delivering a product or service.
Three Business Processes to Automate Now
Realizing that some companies still do their work on disparate software systems, Excel spreadsheets, email and/or paper, even small data automation efforts can pay off for the companies that initiate them. Here are three business processes that can be automated fairly easily in exchange for major benefits:
Managing parts data. Whether you are manufacturing, distributing or buying electronic parts, the data associated with those parts is the lifeblood of the entire supply chain. Buyers need to know how many parts are available, how much they cost and who they can be procured from. They also need the specifications for specific applications or board designs. With several component manufacturers as customers, Orbweaver helps those companies gather the necessary parts data, send it to their distribution partners and share it with direct buyers. That way, everyone has the information necessary for making good buying decisions.
Handling purchase orders (POs). All companies want to be able to receive POs as quickly and efficiently as possible, so once parts data is automated, POs are the next logical choice for automation. Most companies already have a process in place for fulfilling POs, and either an enterprise resource planning (ERP) or manufacturing resource planning (MRP) system that can be used to automate the receipt, parking and fulfillment of orders. By automating the process, companies can get orders out the door faster and with less human effort.
Distributing requests for quote (RFQs). Automating the RFQ process helps companies improve intake and response times—a bonus both for prospective clients, who will receive information faster, and for suppliers, who can generate and respond to more RFQs, and potentially gain more business. Using data automation, companies can generate a quote request based on accurate, verifiable data within minutes. Quotes can be structured to include information about availability, acceptable alternative parts, customer and volume discounts, and more.
It’s a Smart Move
In a world where labor resources are costly, difficult to recruit and even harder to retain, automating business processes is a smart move. Some of the top benefits that companies see include improved operational efficiency, reduced costs, better document management, enhanced customer service levels and greater compliance. Companies that automate some or all of their processes can also reallocate high-value human labor (i.e., salespeople, accounting professionals and IT employees) to more important projects and away from having to manually enter (and then re-enter) data into disparate systems all day.
The proof is in the numbers: a recent Orbweaver/Sonic Manufacturing Technologies study found that the average cost of manually moving a document fell from $25 to just $0.25 once companies applied automation to the task. The bulk of the $25 was consumed by human resources, but the financial savings go far beyond just a $24.75 savings. Once freed up to make additional sales, solve pressing organizational problems or tap into new business opportunities, those human resources wind up adding to the company’s bottom line, versus taking away from it.
In the end, customers are the ultimate winners of the digital transformation game. They get better service, quicker responses, faster order confirmations and myriad other wins the minute cumbersome, manual approaches are replaced with automated processes. Even the company that’s reluctant to kick off its digital transformation journey in earnest can begin to experience some or all of these benefits. This doesn’t require a full tear-down or major disruption to current processes; it just takes one first step in the right direction.
