Digital transformation initiatives were already underway among life sciences manufacturers before COVID-19 struck, but the volatility resulting from the global pandemic in 2020 brought to light the importance of digital supply chain tools. In fact, according to a McKinsey survey of global executives, companies digitized many activities 20-25 times faster as a result of COVID-19.
For life sciences organizations, integrating digital supply chain tools has enormous implications.
For forward-looking companies that are taking steps toward digital transformation in manufacturing, research is beginning to show a clearer business impact of digital supply chain management.
“At organizations that experimented with new digital technologies during the COVID-19 crisis, and among those that invested more capital expenditures in digital technology than their peers did, executives are twice as likely to report outsize revenue growth than executives at other companies,” according to McKinsey.
Not only have digitally mature companies outperformed their competition during the global pandemic, but they are expected to continue accelerating ahead of their peers. Boston Consulting Group (BCG) research shows that more than 80% of companies plan to accelerate their digital transformation efforts — and with good reason.
“Digital leaders achieve earnings growth that is 1.8 times higher than digital laggards — and more than double the growth in total enterprise value. In the short term, digital technologies and ways of working offer productivity improvements and better customer experiences. In the medium term, digital opens up new growth opportunities and business model innovation,” according to the consulting firm. “Successful transformations also set companies up for sustained success; they won’t have to digitally transform again as they master continuous innovation.”
Research compiled in MasterControl’s “The State of Digital Maturity in Pharma and Medtech Manufacturing” report shows that the need to improve connectivity is the driving force for 41% of life sciences manufacturers’ efforts to pursue digital transformation in manufacturing. Companies that don’t embrace digital supply chain management and other modern approaches won’t just lag in digital maturity – they’ll fall behind competitors who are enhancing efficiency and visibility by using innovative new tools.
Several technologies have emerged to help life sciences companies excel in an increasingly digital economy. Here is what five of these technologies mean for the life sciences supply chain:
The promise of digital transformation in the supply chain is a more complete understanding of every element of the supply chain, helping companies to improve planning, decision-making, and responding to issues. When data is digitized and connected to other data points across the enterprise by the IoT, and analyzed by AI algorithms, the data becomes more visible, usable, and valuable.
Integrating digital supply chain tools can bring substantial opportunities when the right digital technologies are applied and in the right way. Yet large-scale change is hard, so as life science manufacturers look for ways to boost the business impact of digital supply chain tools, they can start their digitization efforts with a "small automation" approach, focusing on quickly implementing flexible, adaptable technologies that fill existing gaps created by their enterprise systems.
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