An efficient supply chain is critical for the survival and success of any business. But many companies, cutting across sectors or size, struggle with their supply chains. 

The supply chain ecosystem involves a complex web of partners and multiple processes. These processes invariably require extensive documentation and paperwork, resulting in inherent inefficiencies. Paper documents also hinder the digital transformation of supply chains. 

The key elements of supply chain documentation

The key elements of supply chain documentation include:

• Inventory records such as invoices, purchase orders, and warehouse out-pass. 
• Order and shipment records such as purchase orders, delivery receipts, and shipping manifests. For international shipments, customs declaration forms are indispensable. 
• Contracts and agreements with suppliers, transporters, warehousing providers, and other supply chain partners. These documents clarify the terms and conditions, pricing, and delivery schedules.
• Quality control and compliance documents. 
• Communication records. A document trail of communications improves traceability and ensures accountability. 

What is document digitisation?

Document digitisation involves the conversion of paper-based documents into digital formats. 

The post-COVID digital era has made the digitisation of supply chain documentation inevitable. Most supply chain processes are now computerised and capable of generating digital documents. Some records, such as contracts and receipts, are still executed on paper. Technologies such as OCR scanning convert these documents into digital formats. 

Organisations do not have an option to continue with paper-based records, as doing so will make them incompatible with their wider digital ecosystem. 

Document digitisation is the first step towards a comprehensive digital transformation of the supply chain. Digitising documents paves the way for implementing cutting-edge technologies such as embedded sensors, blockchain, and intelligent automation. These transformations make supply chains more agile, flexible, and open.  

How document digitisation improves the supply chain

Digitisation makes the supply chain network more agile, flexible, efficient, and transparent. Gartner estimates such digital transformation to increase revenue by 20% and reduce process costs by 50%.

Better control

The movement of goods across the supply chain requires approvals at every stage. This. in turn, necessitates cross-referencing documents and updating records. Paper documents force supply chain partners into laborious and time-consuming manual processes. For instance, goods get held up at a warehouse due to payment or transportation delays.

Digitalisation of supply chain documents enables automated workflows, approval systems, and tracking mechanisms. Managers can track the movement of goods to take timely action and intervene to solve any delays. Customers can also access up-to-date status information about their orders until delivery. Supply chain partners can also automate and better leverage analytics.

Digital contract management systems offer all stakeholders instant visibility into contracts. They get ready access to information to make the correct decisions. They also have greater control over contractual obligations.

Seamless collaboration

Siloed communication and slow exchange of paper documents hinder collaboration between different stakeholders. 

Cloud-based platforms and digital communication tools facilitate seamless collaboration. Digital documents enable seamless communication between suppliers, manufacturers, distributors, retailers, and other stakeholders. Silos that hinder communication disappear. 

Accuracy

Manual documentation is error-prone. Human errors in data entry often lead to costly mistakes. The implications include sending shipments to the wrong addresses and frustrated customers.

Document digitisation eliminates manual data entry, leading to speed and accuracy. Automating the data capture processes streamlines the entire supply chain workflow.

Improved decision-making and responsiveness

In today’s uncertain business environment, supply chain disruptions are inevitable. Natural disasters, wars, and other macro-level disruptions can wreck even the best-laid plans. 

Paper-based documentation makes it difficult to collect and analyse data. By the time managers gather the relevant information, the damage would have become huge.

Digitisation of documents offers real-time visibility, enabling faster responsiveness and quick, data-driven decision-making.

Digital records, accessible through mobile apps, allow managers to assess the disruption. They can, for instance, identify the quantity of goods struck at any place and the vehicle carrying the cargo. Such insights facilitate the implementation of contingency plans.

Traceability

Identifying the source of products is difficult in a traditional paper-based system.

Digital records provide comprehensive traceability throughout the supply chain. Organisations can trace the goods end-to-end. Such ready insights make it easier to pinpoint the source of any issues, facilitating rapid and effective responses. For instance, the supply chain partner can trace the origin of products in case of product recalls or quality concerns. 

Better demand forecasting

Traditional supply chain models often struggle to predict demand. Manual processes and paper records create silos, and information flow lags. 

The enhanced visibility afforded by document digitisation enables making decisions with real-time data. Digital documents make available a wealth of data analysts can use to identify trends and patterns. Enterprises can use such insights to adapt to market changes and optimise supply chain processes. Organisations can, for instance, predict changes in weather patterns to stock umbrellas. 

Digital billing systems offer real-time stock and inventory levels. Businesses monitor such data to optimise inventory, reduce stockouts, and minimise overstock situations. Rightsizing inventory leads to competitive pricing, operational efficiency, and customer satisfaction.

Supply chain partner management

An efficient and resilient supply chain depends on reliable partners. Assessing and managing suppliers can be challenging without real-time data and insights.

Digital documentation facilitates monitoring the performance of supply chain partners. Organisations extract data from invoices and other documents to identify high-risk suppliers. They can implement strategies to associate with reliable suppliers and mitigate potential disruptions. 

Fool-proof compliance 

The global nature of supply chains means partners navigate a complex web of regulations.

Such compliance burden is a heavy burden and a huge cost centre. Yet it is unavoidable, and any shortcoming risks heavy fines. 

Digital compliance management systems automate compliance with customs, trade laws, and other regulations. These systems use digital documents to auto-generate compliance reports, eliminating unproductive clerical tasks. Automated checks for compliance at each stage of the supply chain ensure process integrity. Automated forms reduce errors and ensure the organisation meets all regulatory requirements. This mitigates the risk of legal penalties and expedites the movement of goods across borders.

Conclusion

Document digitisation transforms the supply chain from a slow and rigid system into a dynamic and agile network. The ensuing accuracy and speed empower businesses with increased flexibility and responsiveness. 

But realising the benefits depends on having robust solutions capable of analysing digital documents and drawing insights at scale. Tools such as OpenText improve supply chain visibility and enable self-service insights. OpenText leverages AI to analyse massive amounts of data while ensuring the details do not get lost in volumes or complexities.