Handbook of Research on Managerial Practices and Disruptive Innovation in Asia by Ordoñez de Pablos Patricia

Author:Ordoñez de Pablos Patricia
Language: eng
Format: epub
Publisher: Business Science Reference

In this study, the authors explored the strategic imperatives, drivers & challenges of automated technologies applied in SCM function of firms in Indian industries. Semi structured open-ended in-depth interviews were conducted. It can be concluded from the findings that a lot of development was going regarding the digital innovation side. But the advancement of innovation in physical innovation has been relatively slow and it would take a decade or so down the line to gain proper foothold. Firm management would resort to innovation when the firm had achieved full efficiency point and there was no more scope of increasing efficiency with current level of SCM technology. Innovation especially digital innovation has been gaining importance because of competitive pressure and market forces. New technologies especially in the area of demand planning and forecasting, big data analytics, IOT, Software as a Service (SAAS), Enterprise Resource Planning (ERP), Transportation Management System (TMS) & Warehouse Management System (WMS) had been changing the way companies did business. These technologies would be enabling firms to stay ahead of competition if applied for SCM function. Digital transformation could be viewed as a journey and these solutions were evolving continuously. Firms were finding new ways to improve revenue and cut down costs. Digital innovation would be helping firms to reduce its Operational Expenditure (OPEX) and improve the bottom line that is profit. It would also reduce the human intervention and reduce human errors. Integrated supply chain had become the need of the hour as the extent of SCM of a firm was broadening and becoming complex. With throughout integration of SCM, the transparency would increase for a firm. Wastage of resources would reduce and resources like skilled worker would be free for undertaking value adding activities. In India, a major concern before implementing any innovation initiative at an organization has been the ROI. One could argue that most employees were aware of the outcome of the innovation but the process to go through often lacked clarity. Most employees in organizations experimented to get to the desired result. The major challenges in implementing digital innovation had been the high cost of innovation, high total cost of ownership, integration of new system with the existing system (which has been very difficult), poor quality of input data, lack of proper infrastructure and difficulty in implementing change management.

There has not been much advancement occurring in the adoption of physical innovation in SCM domain. This has been because of the cheap labour availability in India. Further, technology has been in its nascent stage and often not reliable. RFID has been gaining importance especially in the logistics and ecommerce domain. Physical innovation would take time to mature in the Indian market for widespread use. The market condition of India has been unique as it had been a developing market. Western researchers didn’t mention much about the hindrances an Indian firm (or for that matter any emerging economy firm) would confronting in implementing such technologies in SCM domain. One could argue regarding the strong role of technology in implementing effective supply chain strategy.

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