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Importance of digitizing Nepal’s supply chain

Importance of digitizing Nepal’s supply chain

Nepal’s logistic sector needs to work towards transforming supply chains through digital platforms and technologies. Despite the rapid advancement of the global supply chain, we continue to rely on traditional methods. The World Bank has been suggesting the government on the agenda of digitalization, but a lack of coordination among government stakeholders has been obstructing the move. The integrated border management system (IBMS) from the World Bank will help streamline the border issues as well as help proper planning from the transit point until the logistic centers and electrical cargo tracking (ETCS) system of ADB with some amendments would help in the transit and domestic flow of goods. The trade facilitation and cross-border paperless trade agendas have been pending for a very long time with little to no activities. Further, involving freight forwarders in the Nepal National Single Window (NNAW) is pending .

The bilateral and regional agreements are all being executed in a very traditional manner, without incorporating modern automation and digitalization mechanisms to ease business and increase traceability, predictability, and accountability to facilitate and meet global supply chain demands.

The customers demand and expect faster, more transparent, and personalized service. To meet their expectations, we need to utilize digital platforms to enhance the customer experience through better tracking, faster delivery, and improved communication to ensure seamless integration of data across different systems and platforms associated with government and private sector service providers. This demands developing data formats and communication between actors in trade facilitation. Another significant challenge is adopting new technologies, scaling them throughout the supply chain through pilot projects in controlled environments before scaling, and making sure these components are simple to integrate and adapt.Protecting sensitive supply chain data from cyber threats is another important and burning issue. Implementing cybersecurity measures, such as encryption, multi-factor authentication, and regular audits, can overcome this by ensuring the accuracy, consistency, and timeliness of data across the supply chain. Data governance policies, as well as the use of data validation tools to maintain high data quality and implement digital signatures, could be useful methods.

The cost factor associated with implementing new digital technologies is high. Still, there is a need to do a cost-benefit analysis and seek cost-effective solutions or phased implementation approaches to manage cost factors. Implementing automation through digitalization has proven successful in many countries, as it helps monitor the flow of goods, documents, money, data, and information among all those associated with the supply chain.

It is essential to change the mindset and adapt to change management by motivating the workforce through proper training, enhancing their digital knowledge, and addressing cultural and operational changes within organizations such as the Departments of Customs and Commerce, as well as both private and government logistic service providers.

Therefore, developing comprehensive training programs and change management strategies to help employees adapt to new technologies is a must, as is setting fixed regulations and standards across different actors and government support agencies to ensure compliance through regular audits. Another challenge is balancing digital transformation with sustainable practices to lessen environmental impacts through monitoring and evaluation. Other precautions include integrating new digital technologies with existing systems using middleware solutions and gradual transition strategies to avoid disrupting operations.

The transition to digitalization in the supply chain requires many issues to be addressed. Some issues require a strategic approach, leveraging the latest digital tools and technologies while ensuring alignment with overall business objectives and maintaining flexibility to adapt to future changes. Implementing IoT devices, real-time tracking, and advanced analytics to monitor and optimize supply chain performance will enable real-time visibility for analytics purposes while also easing the process of doing domestic and international trade.