Arvato Supply Chain Solutions establishes digital unit

Arvato Supply Chain Solutions has now established a new unit called Arvato SCS Digital with nearly 300 employees. For the company, this is an important step to advance its digitalization strategy and develop new digital solutions and products for its customers at all levels of collaboration.

(Gütersloh) “With the digital unit, we strengthen our market position by combining two factors – the development of digital offerings for clients and their end customers and the implementation of digital solutions along the logistics value chain,” emphasizes Frank Schirrmeister, CEO of Arvato Supply Chain Solutions. The competition is changing: “To meet the increasing demands of clients and their customers, there is no way around the digital supply chain.”

Customers of the supply chain and e-commerce specialist will benefit even more from industry-specific digital solutions and products in the future. “We are organized by industries in our corporate structure and have deep industry and logistics knowledge in these areas. With the new digital unit, we are now creating competencies that integrate this know-how with digital expertise at all levels,” explains Boris Scholz, who leads the new unit as Chief Digital Officer of Arvato Supply Chain Solutions.

Customer Experience Cloud

The focus is on the benefit for the end customer. “The better our clients can serve their customers, the more competitive they are,” says Boris Scholz. One project that has already received positive feedback from clients in the fashion industry is the Customer Experience Cloud, which aims to provide end customers with a more comfortable shopping experience when shopping online. Boris Scholz: “This includes, for example, desired delivery dates, extensive tracking and tracing information even for marketplace orders and international shipments, in-store apps to support omnichannel processes, analytical functions, and pre-registrations for returns with the possibility of triggering refunds directly with the first scan by the carrier or the parcel station. It is a digital product with clear added value for customer retention, as the customer acts as the point of contact for the online buyer while we handle the services in the background.”

The basis and increasingly important for such digital solutions is the use and analysis of existing data. Arvato Supply Chain Solutions can draw on a comprehensive stock of information, as the company manages the entire value chain and thus has data from the warehouse, end customers, clients, suppliers, and transport service providers. “There is still a lot of potential here that will be transformed into real added value in the future through the collaboration of data experts and developers,” says Boris Scholz. “A current development is, among other things, the so-called AI-Control-Tower. This is a modular digital solution that provides our colleagues in logistics with important decision-making aids using artificial intelligence – for example, for better shift planning, optimizing pick and pack processes, or visualizing shipments in the outgoing goods area that are given special priority. Employees can make system-supported and data-based decisions that previously had to be made by foremen based on their experience.”

Artificial Intelligence and Algorithms

Arvato also uses artificial intelligence and algorithms in the area of digital image recognition. Currently, a pilot project is underway for camera-based analysis of returns. Additionally, this technology will be used in the future for automated quality assurance in logistical additional services – for example, in the repackaging of goods. Furthermore, automated image recognition processes could be used for inventory counts. Integrated image analysis data already scan barcodes today while logistics processes continue. “All of these are examples of increased efficiency along the logistics processes and ultimately mean a higher service level or lower costs for our clients,” explains Boris Scholz.

“To be able to offer solutions for the digital supply chain, we have recently invested heavily in cloud technology and are now well-positioned for the future,” says CEO Frank Schirrmeister. As an important strategic pillar, all applications and the SAP R/3 systems are currently being migrated to SAP S/4 HANA in the Microsoft Azure Cloud. This allows for the use of advanced analytical tools, easier integration of external suppliers, and real-time reporting to create digital added value for clients. Investment has also been made in employee training to prepare them for digital challenges in areas such as cloud, data analytics, or applications related to machine learning. Since the beginning of the year, all collaboration tools such as Office 365 or Microsoft Teams and SharePoint have been migrated to the cloud. Especially during the pandemic, this significantly strengthened virtual collaboration.

Conditions for Future-Oriented Growth Established

Boris Scholz: “We have laid the foundations for future-oriented growth with the new unit – and we have a customer base that makes me more than optimistic that we can successfully land digital projects. We have not yet tapped into the potential.” Frank Schirrmeister shares this view: “Our vision is to further develop Arvato Supply Chain Solutions into the internationally operating supply chain company with the greatest customer orientation and the strongest focus on data and IT. With our consistent ‘Cloud Only’ strategy and the establishment of the digital unit, we have created a very solid foundation for this.”

Photo: © arvato Supply Chain